Administrative Office County Administrative Officer*

There is no monitoring system in place to assure that CAL-Card program policies and procedures are followed. Response Respondent disagrees with the finding per California Penal Code 933.05 (a) (2). The Grand Jury's assertion that there is no monitoring system in place to assure that CAL-Card policies and procedures are followed is not supported by the facts presented. In particular, the facts as presented state that the administrator has the authority to suspend or revoke the use of the card at any time (See Fact 2 e) and the administrator receives and reviews the monthly summary reports from the bank which outline all card purchases made by each cardholder (See Fact 2 f). Furthermore, the facts point to observations made by the administrator regarding "issues" with cardholder's use. These "issues" include attempts to make purchases which exceed transaction or spending limits, cards used by persons other than the designated cardholder and cards misused for personal purchases (See Facts 4 a, c, d). Additionally, the report highlights a specific instance of misuse within the Auditor-Controller's office (See Fact 6). The Grand Jury report credits discovery of this misuse to the administrator "during review of a monthly summary OUNT www.madco311.com www.madera-county.com report." These instances cited within the report are a result of monitoring of the program performed by the administrator.

The reports and information available to the administrator and Auditor Controller are inadequate to support pro-active monitoring of the program's operations. There is no opportunity for reconciliation between individual account statements and monthly summary reports. Response Respondent agrees with the finding per California Penal Code 933.05 (a) (1).

Cardholders are trusted to be prudent, honest, and ethical in their use of the card. Response Respondent agrees with the finding per California Penal Code 933.05 (a) (1).

There is an inconsistency in the timeframe for submission of monthly statements, five days in the policy and procedures manual and seven days in the cardholder agreement. Response Respondent agrees with the finding per California Penal Code 933.05 (a) (1).

The Grand Jury was unable to evaluate the use of the CAL-Card program by the BoS and Chief Clerk of the Board because they failed to provided all requested records. Response Respondent partially disagrees with the finding per California Penal Code 933.05 (a) (2). The Auditor-Controller has reported that he communicated with the Grand Jury via letter and informed the Grand Jury that copying the requested records would place too great a burden on his department; however, all records were available for review by the Grand Jury. According to the Auditor-Controller there was no response from the Grand Jury to his letter inviting review of the requested records.

Some cardholders are not aware of their spending limits and available fund balances. Response Respondent partially disagrees with the finding per California Penal Code 933.05 (a) (1). The Grand Jury report provides no facts to support this finding. The Grand Jury's assertion that "some" cardholders are unaware of their limits or balances is so vague that it is impossible to truly assess the seriousness of the finding.

The card's ease of use promotes lack of planning, resulting in higher costs for "emergency" purchases. Response Respondent disagrees with the finding per California Penal Code 933.05 (a) (2). The Grand Jury fails to present even a single fact in support of this vague assertion. To the contrary, the introduction to the report highlights some of the virtues of the program. As the Grand Jury itself states, "The card provides a simple, expedient method for paying for approved travel expenses. It is used whenever possible in lieu of petty cash or small value purchase orders, thus avoiding paperwork and processing time required to use the Purchasing Department services. The County received a rebate from the bank for all card purchases."

The origin and status of the $30,000 question has not been determined. Response Respondent disagrees with the finding per California Penal Code 933.05 (a) (1). According to the Auditor-Controller, the $30,000 in question was the result of payments misapplied by U.S. Bank.

"Previous balance $0.00" provides misinformation to the cardholder when a prior balance has not been paid, and the administrator is not alerted to a possible problem. Response Respondent agrees with the finding per California Penal Code 933.05 (a) (1)

The County's CAL-Card program is susceptible to misuse. Response Respondent partially disagrees with the finding per California Penal Code 933.05 (a) (2). All County programs are susceptible to misuse to some degree whether it be welfare fraud or a breach of the County's computer system or even misuse of a County vehicle. As identified in the report, the CAL-Card administrator has discovered instances of misuse and the County has taken appropriate action in response.

The cost of meals provided at meetings is not limited. The average cost of most of the meals purchased exceeded the out-of-county lunch reimbursement rate by $10. Response Respondent disagrees with the finding per California Penal Code 933.05 (a) (2). Working lunches with members of the County's Management Team are not subject to the out-of county travel policy and meal reimbursement limits. As has been publicly stated, these meetings balance productivity with cost. The advantages of bringing management of functional areas together for focused sessions of discussion and strategy around specific issues far outweighs the cost. Casting these costs against the County travel policy is not the proper context for any meaningful consideration.

Examination of the County's budget for the review period indicated that planning, approval, and budgeting for the provision of meals for meeting attendees was not included in the Administration budget. Response Respondent partially disagrees with the finding per California Penal Code 933.05 (a) (2). These expenses are included in the Administration budget as a Special Departmental Expense.

Adequate and convenient meeting accommodations are available in the County Government Center. Response Respondent disagrees with the finding per California Penal Code 933.05 (a) (2). Adequacy of accommodations or the lack thereof, is not a significant consideration with respect to working lunch meetings scheduled by the CAO. As previously stated, the purpose of these meetings is to promote meaningful discussion and planning concerning issues of countywide importance.