City of Lakeport Financial Oversight

Currently there are no rental agreements between the City and the non- General Fund Agencies but it was stated that the verbal agreements were understood by the Department Heads. The rent revenue is used to replenish the General Fund. There are no standards that establish charging rent to non-General Fund Agencies. The rent being charged supposedly includes some percent of the cost of the Council and some maintenance charges, but there is no formula or record of how the number was determined. 2009/2010 adopted budget included rental income totaling $158,258.

While there is still considerable disagreement about what the voters meant when they passed Measure “I” and Measure “J” in 2004, the voter Budget and Finance Committee materials are quite clear. Some people are saying that it should be used exclusively for streets and roads, however:  Measure “I” directed the City to, “…enact a one-half cent sales tax for City facilities, services, and programs? Yes___ No___” The argument in favor of the Tax indicated that the type of expenditures that the tax was to be used for included:  “Deferred maintenance of streets  Re-plastering the Westshore pool – Cost $150,000  Repairing the Library Park headwall  Improving substandard storm drain facilities  Additional recreational amenities at Westside Park  Making Carnegie Library a functional facility.”  Measure “J” stated, “If Measure 'I' is approved, should the proceeds fund repair and maintenance of City streets, park and community service facilities, and expand public services and programs? Yes___ No___”  In 2004, Lakeport voters approved Measure “I” with a 61% vote and Measure “J” with an 82% vote. Therefore the Grand Jury concludes that the Measure I money is a general tax. It is obvious that the taxpayers were and still are confused and may have thought it was just for roads and streets. It was clearly not limited to that use. Thus using it as a general source of revenue is correct.

Regarding the signing of checks, the 2008/2009 Grand Jury found that the City Clerk was signing as one of the required signatures and then the City Clerk was affixing the Mayor’s signature with a rubber stamp thus circumventing the 2 signature policy. This year it was found that the City Clerk still signed as one signature, but the Assistant to the Finance Director applied the Mayor’s stamp. The Grand Jury believes that applying a signature to a check is a significant responsibility and should not be delegated in this manner by the Mayor. Budget and Finance Committee

The committee observed a reconciliation of the petty cash fund and it was correct at $300.

When asked whether the City had any specific financial benchmarks or goals, the answer was “none” other than meeting the budget. The Finance Director stated that her most specific concern was how to generate more revenue. Most organizations monitor and measure different ratios such as % of Accounts Receivable (taxes) that are delinquent, % of budget spent on labor, etc. The financial health of the City is a significant issue. Recommendations: