County Services and Special District Committee Mission Statement The County Services and Special District Committee of

Comments 36

• CO1
  The District reportedly purchased the Golden Star and Moon Drive properties for water rights. They originally had no intention for developing the two properties, other than offer a location for a Kern County fire station on the Golden Star property. In the Greater Tehachapi Area Specific and Community Plan, dated December 2010, any development of land under 2.5 acres is subject to the requirement of a public sewer system. Any request for a sewer exception must go to the Kern County Engineering, Surveying, and Permit Services. If either of these two properties were to be developed they would have to use the existing GHSC system. The development costs would be extremely high. This would result in major sanitation construction on Kern County roads to get to the GHSC. One consideration would be a bond ballot initiative that would cost the entire community of Golden Hills. However, if the District purchases the GHSC, grant monies could be possible.
• CO2
  In open session of the Special Board Meeting of January 28, 2015, members of the Board criticized the General Manager about changing the entry code on the door to the staff office area. This disallowed unrestricted entryto Board members. Members of the Board wanted unrestrained entry to the staff offices and files. Management said “No”. The Board subsequently voted to direct the General Manager to give the Board the code for the office area. The District Handbook for Golden Hills staff states that the General Manager is responsible for all the staff employees in regard to all handbook policies. He also has the obligation and authority for ensuring these policies are followed along with all issues associated with the Privacy Act. If this policy is violated, the General Manager is expected to remediate the action and issue any disciplinary action to the employee. The Board of Directors having the same code and potential accessibility twenty-four hours a day, seven days a week, compromises the ability of the General Manager to comply with his duty. The 99 General Manager has no power over the Board if a violation occurs. Conversely, not having the codes allow a level of protection for the Board if a violation were to occur.
• CO3
  On March 25, 2015, the President of the Board requested the District’s Password to the CalPERS account from the General Manager and was denied. At approximately the same time the request was also made by the Board President and Vice President to the Human Resources Manager and was again denied access. The Board President and Vice President are elected officials and should not have access to these types of accounts because of the Privacy Act. CalPERS is very explicit about Privacy Act violations.
• CO4
  Starting in January 2015, the GHCSD has minimized the meeting minutes to the extent that no substantial substance has been explained on the topic issues. It has been announced by the Board that any member wishing a full description of a meeting can obtain it by requesting a recorded disc (at a fee).
• CO5
  The Committee accessed all of the Regular Board Minutes and Special Board Minutes from the GHCSD website for 2014 and 2015(ten months). The frequency of closed meetings is excessive by Brown Act standards. Board of Director Meetings Total Meetings (Closed Session) No Action Taken 2014 Regular Board Meetings 11 11Closed Session (100%) 8 sessions 2014 Special Meetings 10 5 Closed Sessions (50%) 4 sessions 2015 Regular Meetings (to date) 14 14Closed Sessions (100%) 13sessions 2015 Special Meetings 16 10Closed Sessions (63%) 9sessions
• CO6
  Since December 2014, the primary topic of monthly closed session meetings is the General Manager’s performance review. Of 14 Regular Board Meetings, 11 had Closed Sessions to discuss the General Manager’s Evaluation and of 16 Special Board Meetings, 6 had Closed Sessions to discuss General Manager’s Evaluation. CSD law states that there should not be a closed session other than for a rare need. Personnel issues are allowed. However, continued evaluation of an employee over an extended period of time is ineffective and derisive. It can also be expected to change the work attitude of the person involved. 100
• CO7
  Acting on the issue of lack of transparency identified by previous Grand Juries, the General Manager made the decision in late 2014 to purchase video streaming equipment for the board room. This equipment was installed February 2015, but has not been turned on for use, citing the lack of a policy directive. In the course of interviewing the Directors, it was reported to us that the purchase of the equipment ruffled the feathers of some of the Board members because it was not vetted with the Board beforehand. Yet, it is in the minutes that the purchase of the equipment was approved by the Board. The General Manager had authority to make discretionary purchases up to $30,000 without Board approval.
• CO8
  Complaints and comments received from senior management and clerical employees evidence several problems with “workplace harassment” by the Board of Directors. This includes: • Interference with work performance • Intimidation • Ridicule • Threats Also, management and staff personnel have reported that some of the Directors go directly to them to assign work tasks. The GHCSD Code of Conduct §§4.04 and 8.03 says that all work activity must be assigned through the GM. Staff members have stated that the current practice is highly disruptive in their performing normal work duties. The problem has been reported to the GM and to the Board but no corrective action has been taken.
• CO9
  The General Manager, as reported by other staff members, has been coerced into doing (or not doing) what the Board demands even though requests are non-compliant with District policy. It has been said that the main threat is job security. As one example, the GM admittedly is not involved in the process of developing the Agenda packet. He attributes this to Board exclusion and the fact that the new Board Secretary does work almost exclusively for the Board of Directors. In the past, the Board Secretary did work for senior staff as well as for the Board members.
• CO10
  In the Regular Board Meeting of November 20, 2014, some people (four identified by name) expressed their desire that the 2014 Public Employee Performance Evaluation be continued to a later date to afford additional time for review. These people were mostly related to or had friendships with the aforementioned “prominent businessman and resident”. If the Board had agreed with this action, the contracts with the employees would have expired and they would have been at risk to be dismissed with 30days’ notice. 101
• CO11
  The 2014 Board of Directors voted on new contracts for the three senior managers before the 2015 Board took office in December. The new contracts extended the severance term from 12 months to 18 months in the event that the employee was terminated (for other than cause). The vote was 3 Aye-2 Nay and was passed. The two dissenting board members moved onto the new board along with two newly elected board members. The four members of the current Board that did not or could not vote yes to the new contracts stated to the Committee that the contract terms were essentially forced on them.
• CO12
  The 2014-2015 Grand Jury Report to Golden Hills had the finding; “Directors are not following the Brown Act in failing to agenize items discussed in closed session.” The Board’s response to the Report stated; “The District does not have sufficient information to respond to this finding because the finding does not describe any items discussed by Directors in close session that were not properly described on an agenda”. In the regular meeting minutes of August 21, 2014, on reporting of “Memo to the Board” dated July 15, 2014, (that was turned over to the Legal Counsel for response) Legal Counsel responded that the author of the memo to the board had made some good points and that “the District would (sic) to be more diligent in announcing what will be addressed in closed session. Further, although the code is silent on the issue of public comments on closed session items, the Attorney General’s Brown Act Booklet states it would prudent to do so”.
• CO13
  In the regular Board Meeting of May 15, 2014, one director cautioned the board; “to remain free of conflicts of interest and then discussed the same Director’s endeavor of forming a 501 (c) (3) entity entitled Golden Hills Community Center.” Earlier, on May 1, 2014, the same director had a meeting with a “prominent businessman and resident along with two other residents in hopes of building interest in the community center on the Golden Star property. This was documented in a memo to Legal Counsel. However, information about the property involved was still being discussed in closed session and was therefore a violation of the Brown Act.
• CO14
  In the regular meeting of October 16, 2014, wherein the matter of the Golden Hills Community Center was on the agenda for discussion, the same director (refer to F19) stated, “I have received a generous offer from a “prominent businessman and resident” to provide design services, and ...did not feel the need to recuse myself from other discussion concerning usage of District properties.” Subsequently, in the same meeting, Legal Counsel provided the Board with his interpretation of the Political Reform Act relative to conflict of interest, and stated; “Provisions of the law would mandate recusal of the director if a contract involved affecting District lands.” Unfortunately, the Director had already pursued the Community Center designoffer.
• CO15
  The 2015 election campaigns of the two new board members were run by the same “prominent businessman and resident”. All expenses were paid by this resident, with the exception of $500 that each candidate contributed. One of the other directors, a realtor,has represented the same individual in the sale of at least one property. 102
• CO16
  The campaigns of the two elected Directors focused on financial irresponsibility and identified excessive salaries and staffing for the GHCSD. As collaborated by three sources, the aforementioned “prominent businessman and resident” made the verbal statement in the office on two occasions that “after the election, all of the managers will be gone”. Manager names were specifically identified in this pronouncement. It was reported to the Committee that this has made managers and staff feel that their jobs are in jeopardy. At the time of this report, some hourly employees are negotiating with the same union that they rejected a number of years before.
• CO17
  At a Special Meeting of July 23, 2015, the same “prominent businessman and resident” made the statement from the podium that the three managers’ contracts are what prevent the current board from being able to fire them. “Approving those contracts was one of the worst decisions made by the previous board.” The Committee can only assume that the daughter, who is a board member, was in agreement with the statement from the podium. In fact, an ex-Director informed the Committee that the daughter asked some of the GHCSD staff “How much would it cost to cash them out?” This resident-daughter relationship is likely impacting ongoing events.
• CO18
  One of the Directors, as well as one resident made the statement that an individual previously identified as a “prominent businessman and resident” has been developing close relations with some of the Board members and feels that he has control of the Board. This has been voicedby managerial sources as well. If the situationexists, all affected Board members could be relieved of their position.
• CO19
  The Board advised the GM that the 2015 merit pay increases that he approved for selected staff were reduced by the Board 50% and the balance put on hold until the 2016 budget is approved. Heretofore, employee merit salary increases have been entirely at the discretion of the General Manager (CSD Law §61051 {d}). The Board stated that the level of increases exceeded the adjustment for cost of living and was considered to be excessive.
• CO20
  A GHCSD agenda meeting is done on Tuesday, the week prior to the regular meeting. After the Board Secretary compiles the agenda, it is given to the Board President for review and approval. It is then reviewed by the District Legal Counsel for necessary changes. To comply with the requirement to make it available 72 hours prior to the CSD meeting, it would need to be posted no later than Monday PM for a Thursday meeting. The approved agenda is also given to Announced Solutions IT Services, the GHCSD webmaster, for posting on the web site. This is an involved process in a short period of time. According to interviewed sources, it does not always go as intended, meaning that the posting is lateat times, most often on the website.
• CO21
  According to the senior managers, changes to agenized items are frequently made only a few hours prior to the meetings. This does not comply with Brown Act requirements. The practice fails to inform District members 72 hours in advance on what will be discussed and considered for vote. 103
• CO22
  Because of the problems created in not posting agenda items properly, the minimization of meeting notes in 2015, the ongoing decision to not use the video equipment and the large number of closed meeting sessions, there is the perception that the Board is not attempting to work on the transparency of its actions. The 2014- 2015 Grand Jury Report mentionedthe problem of “lack of transparency” as well.
• CO23
  In early 2015 the Board changed Legal Counsel, which is totally within the purview of the Board. In the February agenda (72 hours prior to meeting), the former Legal Counsel is named in the closed session agenda to speak about water rights. Yet, in the open session February minutes (72 hours later) a new Legal Counsel is named. Since there is no mention of this potential change in previous agendas or minutes, the Committee believes that this had to have been previously agreed to by the Board in some unofficial forum. It is an obvious Brown Act violation. Legal Counsel was not officially changed until the March Regular Meeting by Board Action. At least one Board member stated that the change was made for “cause”. The Committee contacted the former Legal Counsel and he stated that he was asked to re-interview for the position with GHCSD that he had held for the past 23 years. The termination appeared to the Committee to be based on retribution for negotiating the three new contracts for the senior manager positions. And, secondly, for stating in open session that a Director would probably be subject to a conflict of interest citation if that Director pursued the use of GHCSD land for a community center while a member of the Board.
• CO24
  There is a strong division of trust between Directors and management. Directors feel that managers are not doing their job and that they are demonstrating signs of rebellion. The management personnel, on the other hand, are seeing that the Directors want more direct control over: • personnel decisions • salaries • operational functions Heretofore, the above have been management discretionary decisions. Until the operational structure is back in line, the District does not have a good operating team.
• CO25
  The Committee has heard comments from several sources that Golden Hills is a “bedroom community” and that people who live that style are tagged as “commuter residents.” The meaning is that they leave early in the morning, return at night and basically relax in the evening in their homes before doing it all over the next day. The inference is that these people do not have the time or energy to get involved in the issues of local government. This partially explains the relatively low attendance at the District meetings, other than a few involved citizens. 104 COMMENTS: The Committee met and talked with all members of the Board of Directors and the senior management. Without exception each individual presented himself (or herself) with professionalism, intelligence, amicability and commitment to their job and to the Golden Hills community. It should be a great team but it is not. The problem is centered on self-motivated agendas of some the board members that interfere with cohesion between management and Directors. This generates distrust and a hostile work environment. An Ad Hoc committee was recently formed to address these problems. The Committee has high hopes that the Ad Hoc committee takes its job seriously and not be reluctant to have meaningful discussions with management on the issues and what to do about it. A former Director said it best in a letter to the Board last year when he said, “Get your differences resolved before they become fodder for those who impose an agenda that would harm our community”. The Recommendations of this Grand Jury report will address corrective actions on many areas.
• CO26
  The GM lied to the Board about the purpose of the project.
• CO27
  The GM failed to get three competitive bids for the work and selected a contractor of his choice.
• CO28
  The GM failed to get a “will serve” letter from the District. He did obtain an unofficial “will serve” letter from the OM and used it for this purpose. The McKee waterline issue was eventually settled with the offending GM and with RW Wayne Co. The GM was terminated and fined $15,000. RW Wayne Co. was also fined $15,000 and they subsequently filed for bankruptcy. The settlement was done on advice from the Lamont PUD legal counsel. The Board agreed to the terms based on the financial numbers involved. It would cost $80,000 to correct and finish the project, or $60,000 to pull the pipes out. They were also told that the waterline extension would improve the quality of the water to other receivers. F11: The water to the commercial property on the McKee waterline extension has still not been turned on. Fees of $56,000 have recently been paid by the owner of the property. The owner, however, has refused to pay interest charges for the three years that fees had not been paid. This is under litigation review. F12: For a period of 18 months, RW Wayne Co. invoices were being submitted and paid for the work performed on the McKee waterline extension. None of the management or the Board questioned the payments during that time. F13: Board Members have said to the Committee that they prefer to not appoint Ad Hoc committees to address District issues. It is reportedly a lack of trust in other members and a fear that one faction or the other would have control of information. This has hampered the development of studied evaluation prior to taking a Board vote. F14: There are employees that have reached their maximum pay within the structure of the District salary matrix. Also, salaried positions, such as the OM, receive substantial overtime pay. In 2013, for example, the OM was paid $32,674 overtime. The budgeted overtime amount for 2015-2016 for the OM is $8,094. Exempt salaried employees are not entitled to overtime pay. The Fair Labor Standards Act recognizes salaried executive, administrative and professional employees as exempt. F15: A proposal was made by the GM in September, 2015 that the District hire a new employee to perform accounting and manage the Human Resources function. This individual would be required to have an accounting degree and at least four years experience in accounting and HR. The pay would be roughly equivalent to the current salary range of the OM. Comments were made by a few Board Members that the District could not afford the cost. The GM stated that the money and audit problems that they had incurred over the past five years would have been mostly avoided having this person. The Board defeated the proposal 3-2. 128 F16: The interim GM has been instructed by the Board to place his primary focus on the recruitment and hiring of a new General Manager to be completed within a timeframe of four to five months. He informed the Board that he was qualified and willing to do this. However, he reported, the time required would take away from his normal GM responsibilities and that important tasks could not be done by him during this timeframe. Comments: It is apparent to the Grand Jury that the District suffers from lack of a strong leadership, weak administrative management skills and from animosity between two factions of the Board. Coherence and trust between members of the Board is absolutely needed. If one or more Directors continually cause a problem, that Director(s) should be removed from the office. The first step in this process is to censure the individual. Censure should be considered when the offending Director levels personal attacks against fellow Directors, causes disruption of meetings or has undisclosed conflicts of interest. Censure is an official condemnation, reprimand or criticism leveled at a Board Member by his peers. Censure does not remove a Board Member from office or technically remove his ability to serve. It is an important means of distancing a Board from counterproductive behavior and can help to guard other Board Members from liability resulting from a rogue member’s comments or actions. The process of removing a Board Member is a different matter. The District should check their bylaws, and if necessary, establish policies and procedures to cover the removal of a Director.
• CO29
  Camp Condor: Referring to comments from the October 15 minutes: “turning this property over to the County hasn’t been as easy or cheap as we initially thought”. A lot of cleanup has been done. It is located in Mountain Park.
• CO30
  Mountain Park Property: There is no water on the property. A tank has been purchased for $35,000. The District is planning to request recovery of the money from the County after the property transfer has been made. FINDINGS: F1. The District is doing a terrific job providing high quality facilities and recreational programs for all age groups. The recreation and parks facilities are known as the center of the community. F2. District salaries are high. In fact, salaries, wages and benefits represent 91.6% of the District 2015-2016 budget. This is a high end cost for a community of 12,000 residents. F3. The District has a strong volunteer program. Volunteers are utilized for coaching and supervising team sports and are provided training. F4. The 6 Step program is an automatic salary increase of 5% annually and does not recognize merit. Over six years, the program will elevate all employees on the program by 34% in salary. F5. The increase in the minimum wage scheduled for 2016 could elevate part time labor costs by approximately $75,000 per year. Additional employment costs may be incurred. If Senate Bill 3 is passed into law, the increase inflates to about $150,000 in 2016 and $300,000 in 2017. The wages for positions that are paid more than minimum are being adjusted, starting January 1, 2016 to maintain incremental pay over the $1.00 increase in minimum wage. F6. Oil prices have not recovered. A price of $60 per barrel is said to be the breakeven level for the oil companies to get back to producing. It didn’t happen. The oil price is now $36 per barrel (as of January 4, 2016). When Iran re-enters the market, forecasters are saying the oil prices may drop to $20 per barrel before starting to come back. It is apparent that, unlike the District forecast, low tax revenues will not be a short term problem. The District may have to rely on their cash reserves for some years to come. 158 F7. The District has not developed a contingency plan in the event that oil prices do not recover to a pre-2015 level. The higher tax revenues are needed to maintain the high level of recreational facilities and programs that are now being offered, without depleting cash reserves. Alternatively, expenses and some program fees must be significantly altered. F8. The $180,000 expended for the Little League fields appeared to the Committee to be well spent. There are four fields, three of which have been upgraded and put into very good condition. The aluminum spectator stands are fairly new, purchased from grant money before the acquisition. There is a large parking lot across the street and adjacent to Franklin Field Park. Regardless of the quality of the expenditure, the Committee is concerned about the District expending this amount of money at a time when income is severely reduced. COMMENTS: The District must be commended for doing everything possible to serve and support the community. Recreation facilities are made available to the schools and to the community in general. Fees are modest to allow affordability to all. A total of 60 part time jobs have been created to support local employment. Yet, the issue of sustainability must be addressed. Tax revenues may not recover for several years to the levels enjoyed by the District in past years. Alternative sources of income may have to be found or expenses reduced.
• CO31
  The Westside Recreation and Parks District should post a copy of this report where it will be available for public review.
• CO32
  Persons wishing to receive an email notification of newly released reports may sign up at: www.co.kern.ca.us/grandjury.
• CO33
  Present and past Kern County Grand Jury Final Reports and Responses can be accessed on the Kern County Grand Jury website: www.co.kern.ca.us/grandjury. RESPONSE REQUIRED WITHIN 90 DAYS PRESIDING JUDGE KERN COUNTY SUPERIOR COURT 1415 TRUXTUN AVENUE, SUITE 212 BAKERSFIELD, CA 93301 CC: FOREPERSON KERN COUNTY GRAND JURY 1415 TRUXTUN AVENUE, SUITE 600 BAKERSFIELD, CA 93301 160 161 162 163
• CO34
  It is apparent to the Grand Jury that the District suffers from lack of a strong leadership, weak administrative management skills and from animosity between two factions of the Board. Coherence and trust between members of the Board is absolutely needed. If one or more Directors continually cause a problem, that Director(s) should be removed from the office. The first step in this process is to censure the individual. Censure should be considered when the offending Director levels personal attacks against fellow Directors, causes disruption of meetings or has undisclosed conflicts of interest. Censure is an official condemnation, reprimand or criticism leveled at a Board Member by his peers. Censure does not remove a Board Member from office or technically remove his ability to serve. It is an important means of distancing a Board from counterproductive behavior and can help to guard other Board Members from liability resulting from a rogue member’s comments or actions. The process of removing a Board Member is a different matter. The District should check their bylaws, and if necessary, establish policies and procedures to cover the removal of a Director. Recommendations: R1: The Grand Jury recommends that a complete and up to date Policies and Procedures manual be published by the District that defines how the Lamont PUD intends to do business. This would replace the “Assorted Lamont PUD Policies” that was assembled February 25, 2016. For structure, it is recommended that the District review manuals that have been adopted by other PUD Districts in California and then use a selected manual or sections of various manuals as a template for creating their own. (Finding F1) R2: A meeting should be held with all members of the Board to openly discuss the problems of lack of coherence and disrespect between members. The subject of censure of one or more members should also be considered. If it is felt necessary, and provable, a vote of censure should be made against those that are considered to be causing continual disruption resulting in ineffectiveness of the Board. (Finding F2) R3: The Board should exert control over the conduct of its meetings to ensure that they are conducted in an orderly fashion and without audience disruption. Members of the audience who routinely disrupt the meetings after warning to cease such disruption should be removed from the meetings by law enforcement. If that is not possible, the Board President has the right to terminate the meeting. (Finding F3) 129 R4: The District needs to get the community involved in its actions and consequently in the election process. Quite often it is not possible or convenient for residents to attend evening week day meetings. It is recommended that the District install microphones on the Board dais to improve audio volume during meetings. Also, evaluate video streaming the Board Meeting in English and Spanish live on the internet. An informed community will be more involved in the District. (Finding F4) R5: It is recommended that the Board Members cast aside all past settled issues that they keep arguing about and start working together on a more coherent basis. Improving coherence and trust between Board Members would greatly improve the effectiveness of the Board in serving the community. When this happens, the District staff members will concurrently experience a better working environment. The Grand Jury expects that the result of a good working Board of Directors will also lead to better recruitment efforts and that the long chain of interim General Managers will cease. (Findings F2, F3) R6: The Grand Jury recommends that the District update job descriptions, salary range and qualifications for each salaried position. This should be one of the primary jobs of the new interim GM. If an individual does not meet the requirements for their position, the General Manager, or immediate supervisor, should discuss it with the employee. Two possibilities exist: (1) require that the employee take additional education as outlined for the job or (2) replace the employee with a qualified person. (Findings F1, F13) R7: Employees that have reached their current maximum salary should be subject to having their compensation frozen until a new salary matrix has been established. Based on standards established by the Fair Labor Standards Act, overtime pay for salaried management positions should cease. This will require reclassification of the managerial employees to exempt status. An exempt classification does not relieve the managers from putting in extra hours if that is required to do the job. (Finding F14) R8: It is obvious to the Grand Jury members that have attended the Board Meetings that individual Directors are not prepared with sufficient information and time for consideration to make decisions. Yet decisions are routinely done involving many thousands of dollars. It is in those cases that the Board should require the GM to provide sufficient time and additional information to allow extended study or that an Ad Hoc committee be appointed for a review of options. (Finding F13) R9: It is not required by law to remove asbestos from the office building. However, if the asbestos is not removed, it must be managed as per the requirements outlined in OSHA document 1910.1001. By law, an Asbestos Management Plan must be written for the District and followed. If this cannot be done in house, a qualified consultant should be used. (Finding F9) R10: The missing $210,000 remains a hot issue with the public three years after the loss was identified by forensic auditors. The Grand Jury recommends the District continue 130 with its independent investigation of employees and procedures to determine the causes of the loss. Relevant questions: (1) who was responsible for ensuring that the annual audits are done? (2) Who was the person responsible for managing the clerks handling the cash and putting it into a secure place? (3) Who was the person responsible for checking bank deposit receipts against the cash received on a daily basis? The Board may wish to put the item to rest by writing a letter to the district constituents outlining its findings. (Findings F6, F7, F8) R11: It is recommended by the Grand Jury that the District reorganize their management structure to include a full time manager qualified to perform the financial accounting and HR functions. At present, the District has nobody on staff with the experience and education to handle this. Increased salary cost to the District may be a consideration. The District needs to make a study of all operational areas to identify cost savings to accommodate the extra salaried person. The Financial/Human Resources person, for example, would eliminate the need to work the OM overtime. (Findings F12, F14, F15) R12: The Grand Jury recommends that the Board consider all of the costs in utilizing the interim GM for the General Manager recruitment effort versus using an outside Recruiting Firm. For consideration, the interim GM salary is $71/hour. The overall concern is the lack of attention on day to day problems and longer term planning efforts by doing the recruiting using in house resources. (Finding F16) NOTES:  The Lamont PUD District should post a copy of this report where it will be available for public review.  Persons wishing to receive an email notification of newly released reports may sign up at: www.co.kern.ca.us/grandjury.  Present and past Kern County Grand Jury Final Reports and Responses can be accessed on the Kern County Grand Jury website: www.co.kern.ca.us/grandjury. RESPONSE REQUIRED WITHIN 90 DAYS PRESIDING JUDGE KERN COUNTY SUPERIOR COURT 1415 TRUXTUN AVENUE, SUITE 212 BAKERSFIELD, CA 93301 CC: RICHARD FRANK, FOREPERSON KERN COUNTY GRAND JURY 1415 TRUXTUN AVENUE, SUITE 600 BAKERSFIELD, CA 93301 131
• CO35
  MOUNTAIN MEADOW COMMUNITY SERVICE DISTRICT “Power tends to corrupt, and absolute power corrupts absolutely” John Acton PREFACE: Special districts may be formed for limited purposes and with barely sufficient finances by well-meaning citizens who are not aware of all the aspects of law regarding public agencies. However, many resources are available to these special districts to inform them of their requirements to operate within the law. With respect to appointed, elected or hired employees of any special districts there is therefore no excuse for ignorance, abuses or defiance of the law or to disregard and disrespect the constituents that they serve. PURPOSE OF INQUIRY: The Special Districts and Services Committee (Committee) of the 2015-2016 Kern County Grand Jury (Grand Jury) conducted an investigation of the Mountain Meadow Community Service District (MMCSD) operations pursuant to Penal Code §933.5. The purpose of this investigation was initiated by the 2014-2015 Grand Jury when they reported, “The Committee has not had sufficient time to fully investigate all issues that have appeared and strongly encourages that the 2015-2016 Grand Jury conduct an in-depth investigation”. At the time of the seating of the current Grand Jury in July 2015, the newly appointed Mountain Meadow Board of Directors had been seated and active since May 2015. They had started the process of securing all bank accounts and facility assets, the process of reconciling accounts with vendors and began to inventory all existing records, documentation and assets. Prior to May 2015, the General Manager had removed all documentation from the file cabinets and had placed the contents in cardboard boxes in an indiscriminate manner and stored the material in various locations within the MMCSD building and all of the shop equipment was missing. By June 2015, the last remaining incumbent Board member had resigned and the General Manager was terminated for cause. Therefore, the initial purpose of the current Grand Jury became the monitoring and reporting on the progress of the new Board in the reformulation of the MMCSD consistent with the recommendations of the 2014-2015 Kern County Grand Jury. However, as early as November of 2015, as the MMCSD restored order to the documentation, they found a number of anomalies with respect to companies doing business with MMCSD. Subsequently, the purpose of the Grand Jury shifted to a more active investigation as documentation packages were sent to the Grand Jury and the District Attorney’s Office from MMCSD. Additionally, MMCSD discovered that the financial records for the years, 2013, 2014 and 2015 were missing. PROCESS: 132 The Committee reviewed the 2014-2015 Grand Jury report and recommendations. The Committee also reviewed the previously obtained material subpoenaed by the 2014-2015 Grand Jury, interviewed members of the newly appointed Board and toured the district. The Committee also had numerous conversations with the District Attorney’s Special Investigator concerning progress in their investigation. When the MMCSD documentation package was delivered to the Committee it was reviewed and a determination made to use the material subpoenaed by the 2014-2015 Grand Jury to independently verify the documentation provided by MMCSD. Subpoenaed material included Meeting Minutes, financial records, invoices, contracts and check logs. Public information resources (internet) were accessed to determine ownership of the companies that MMCSD was doing business with, which included previous court case(s), Code Violation(s), phone numbers and mailing addresses. The Committee also reviewed the MMCSD policies and procedures and special district law pertaining to conflict of interest. BACKGROUND: Mountain Meadow Community Service District was established by the Boise Cascade Company on November 9, 1970 and constructed all the original roads, bridges, drop inlets, drainage canals and flow lines, etc. MMCSD became inactive in July 1985 and was reformulated and activated in July 1991 with new Board Members. MMCSD consists of 735 parcels of 2.5+ acres that are individually owned. The prime mission is to keep the drainage open and to keep the 27 miles of dirt or gravel roads travelable in winter and control dust in summer. MMCSD receives revenues from the annual parcel assessment of $200 and any grant monies that may become available. Residents of this mountain community are responsible for all other utilities including water and septic. As such, most residents are relatively independent and prefer to “live off the grid”, most having little or no interest in serving as Board Members to the MMCSD. All Board Members have been appointed for staggered terms and are duly recorded at Kern County Auditor-Controller Office; Elections Division. FACTS: A. California Government Code pertaining to Special Districts; §§1090 & 87100 “Public officials cannot make or influence a governmental decision in which they have a conflict of interest. An official will have a conflict of interest if the decision has a foreseeable financial effect on their economic interests. They may not exert influence on a decision in which they have a conflict of interest unless their participation is legally required, or the official can establish that effect of the decision is indistinguishable from the effect on the general population.” B. MMCSD Policy Handbook 2006 Conflicts of Interest; 2006.1 “District employees have the obligation to conduct business within guidelines that prohibit actual or potential conflicts of interest. In this policy, the District is establishing the framework within which they wish to operate.” 133 2006.3 “An actual or potential conflict of interest occurs when an employee is in a position to influence a decision that may result in a personal gain for that employee or for a relative as a result of business dealings with the District.” 2006.3.1 “For the purposes of this policy, we define a relative as any person who is related by blood or marriage, or whose relationship with the employee is similar to that of persons who are related by blood or marriage.” C. California Government Code pertaining to Special Districts; §61040 (e) “A member of the board of directors shall not be the general manager, the district treasurer, or any other compensated employee of the district, except for volunteer firefighters as provided by §53227.” D. Letter dated February 23, 2006 was sent to Mountain Meadow Community Service District by the Kern County Auditor-Controller Office informing them of the passage of Senate Bill 135 requiring all special districts of the requirement to have five Board of Directors. MMCSD at that time had only three Board Members and continued to have only three until action by the Board of Supervisors in 2014. E. The former General Manager (GM) was originally a Director by appointment in December 2006 and resigned as the President of the Board on September 17, 2013 to take the position of General Manager of MMCSD. F. Starting on May 15, 2014, the former GM began signing MMCSD checks by his own authority without a second signature of a Board Member. All checks recovered after that date only had his signature. This is not authorized by MMCSD Policy Handbook 3040 which requires two signatures. G. Starting in December 2014, the former GM refused to recognize the duly appointed Board Members by the County Supervisors and the Auditor-Controller Office. H. On January 14, 2015, the former GM gave a Board Member signature authority on his signature alone without approval of the remainder of the Board. I. On March 4, 2015, complaints were filed by the former GM against members of the newly appointed Board of Directors. J. On March 8, 2015, MMCSD was informed by the Kern County Auditor-Controller Office that District funds would not be released to MMCSD since the Board was not operating with a quorum. K. On March 10, 2015, complaints were filed by the former GM against a member of the Kern County Board of Supervisors and a member of the Kern County Counsel’s Office. 134 L. On March 17, 2015, a day after a telephone conversation with County Counsel, the former GM wrote a note to himself in which he details the telephone conversation from his perspective. The note concludes with the former GM stating that he has given instruction to employees that he is closing out the business at MMCSD. M. The Kern County Auditor-Controller County Clerk on March 17, 2015 informed the General Manager of MMCSD the five Board of Directors contact information and a copy of this letter was sent to County Counsel. N. On April 10, 2015, in a renewal questionnaire from Special District Risk Management Authority for equipment inventory, the former GM signed the form that, “All equipment marked out has been junked.” Equipment marked was a Hobart Welder, Chip Sealer, and Galion Motor Grader. There is no other documentation that indicates what was done with the equipment to preclude potential liability as required by MMCSD Policy Handbook 3085. O. On April 29, 2015, the former GM filed suit in United States District Court, Case #: 2:15-CV-00892-KJM-CKD against a member of the Kern County Board of Supervisors for abuse of power. On the same date, the former GM filed suit in United States District Court, Case #: 2:15-CV-00893-TLN-DAD against a staff member of County Counsel for Kern County for abuse of power. This was done without the approval of the Board of Directors. P. On May 20, 2015 Mountain Meadow CSD held its first meeting since November of the previous year due to lack of Board Members. This was because, in 2014, when the required number of Directors were appointed by the Board of Supervisors, the former GM refused to acknowledge their appointment. The May 20th meeting was held without one of the incumbent Board Members and the former GM. Deputies from the Kern County Sheriff’s Office (KCSO), as well as staff from County Counsel and the Board of Supervisors were in attendance to ensure the meeting took place. Since the former GM and incumbent Board Member had the only keys to the facility, KCSO oversaw the removal of the locks and ensured the safety of the MMCSD building. What the new Board found upon entry was that some of the vehicles belonging to the District had been removed, office paperwork was in disarray and all the tooling in the garage area was missing. On further inspection, financial records for 2013-2015 had been removed. All the other records and documentation had been removed from the filing cabinets and were later found in multiple locations inside the facility. Q. On June 3, 2015 a special meeting was held by the MMCSD Board of Directors, during which the former GM was formally terminated. In another special meeting held on June 10, 2015, it was announced the incumbent board member had resigned. The board then set about to find a replacement to ensure five Board Members. 135 FINDINGS: F1. For the period between July 7, 2007 and February 17, 2015, the former GM committed MMCSD to expenditures amounting to $302,693.51 with multiple businesses that were owned by himself or members of his family. This appears to be a violation of California Government Code §§1090 & 87100. F2. For the period between January 7, 2009 and July 30, 2013, while the former GM served on the Board of Directors, he was paid $29,182 by MMCSD as a consultant and for engineering fees. This appears to be a violation of California Government Code pertaining to Special Districts 61040(e). F3. A former Director of the Board was paid $3,070.00 by MMCSD for wages in 2015. This appears to be a violation of California Government Code pertaining to Special Districts 61040(e). F4. A review of Board Meeting minutes for MMCSD after the former GM transitioned from Board Member to General Manager indicates he was still running the meetings and Board Members were taking direction from him. He also got a concession from the Board Members that if one of them were absent, he could vote for them and did so. He unilaterally selected for appointment, swore in Board Members of his choice and subsequently submitted appointment documentation to the Kern County Elections Division. F5. Once a new MMCSD Board was seated on May 20, 2015, and in subsequent meetings, the Board;  appointed a fifth Board Member after the incumbent resigned  conducted an audit of equipment and records  closed existing bank accounts and established new accounts  approved a forensic audit to be performed  started a reconciliation of accounts and paid vendors  hired legal counsel  hired part time General Manager  along with residents of MMCSD started roads and drainage ditch preparation for flooding from summer thunderstorms in advance of an expected El Ni o winter weather COMMENTS: 𝑛𝑛̃ The irony of this Grand Jury report is that it was started by a complaint filed by the former General Manager approximately one year ago to confront what he perceived was Kern County government overreach against his total control over Mountain Meadow Community Service District. The facts and findings of this report show a pattern on the part of one individual to control a community and show his willful mismanagement and disregard for the constituents that he had been appointed and later hired to serve. The 136 former GM has also taken the new Board to court for defamation/slander and reportedly has a history of intimidation against anyone who voices an opinion against him. RECOMMENDATIONS: R1. The Grand Jury recommends that a charge of malfeasance be issued by the District Attorney against the former General Manager and that he be prosecuted to the full extent of the law. (Finding F1, F2, and F4) R2. The Grand Jury recommends that a charge of malfeasance be issued by the District Attorney against a former Board Member for acceptance of wages during the period that he was a Board Member. (Finding F3) R3. The Grand Jury recommends that the current Board of Directors continue to do all things necessary, within the constraints of special district law, for the continued reconstituting of the Mountain Meadow Community Service District. (Finding F6) NOTES:  The Mountain Meadow Community Service District should post a copy of this report where it will be available for public review.  Persons wishing to receive an email notification of newly released reports may sign up at: www.co.kern.ca.us/grandjury.  Present and past Kern County Grand Jury Final Reports and Responses can be accessed on the Kern County Grand Jury website: www.co.kern.ca.us/grandjury. RESPONSE REQUIRED WITHIN 90 DAYS PRESIDING JUDGE KERN COUNTY SUPERIOR COURT 1415 TRUXTUN AVENUE, SUITE 212 BAKERSFIELD, CA 93301 CC: RICHARD FRANK, FOREPERSON KERN COUNTY GRAND JURY 1415 TRUXTUN AVENUE, SUITE 600 BAKERSFIELD, CA 93301 137
• CO36
  SOUTH KERN CEMETERY DISTRICT PREFACE: After receiving multiple complaints regarding lack of transparency by management, inability of residents to contact directors and management personnel, code violations in the cemetery by visitors, poor maintenance of the cemetery grounds and lack of decorum during board meetings, the 2015-2016 Kern County Grand Jury (Grand Jury) undertook an investigation of the South Kern Cemetery District (District). PURPOSE OF INQUIRY: The County Services and Special Districts Committee (Committee) of the Grand Jury conducted an investigation of the District operations pursuant to Penal Code §933.5. The purpose was to investigate all complaints and observecode violations. PROCESS: The Committee reviewed previous Grand Jury Reports on the District for reference. The Committee visited four county public cemeteries to observe best practices for grounds maintenance and signage. The Committee met with the Chairman of the South Kern Cemetery District Board of Trustees, members of the staff and attended a board meeting on August 18, 2015. The Committee also reviewed financial records along with information provided by the Kern County Auditor-Controller’s office. Additionally, the Committee studied the District’s Code of Operations and the results from a survey completed by the District. BACKGROUND: The District is located at 15543 South Vineland Road. The cemetery is on a 12 acre site in the center of the 450 square mile District. The District was formed in 1958 and had the first interment in 1960. There are now more than 6,100 total interments and activity averages about 10 interments per month. Burial cost is about $2,300 which is consistent with most of the public cemeteries in the County. However, it was reported by management that the District operates on a very tight budget and that the low revenue stream prevents the District from staffing to provide the quality of service that other cemeteries are able to provide. Still, aeration and fertilization were started and have taken place for the second year in a row and recently professional tree services were utilized to trim, thin and shape the mature trees. Also, removal of invasive plant species and replacement with hardier efficient varieties has been accomplished. The most visible problem, as voiced by members of the District, has been weed growth covering the grave stones. It has been addressed by the liberal use of herbicide. Unfortunately, the herbicide practice has resulted in an appearance that is not much better than the untended weed problem. The area of dead grass around each grave stone is a random pattern that goes as 138 wide as several inches. The District has one full time salaried manager, one hourly administrator, two full-time and one part-time maintenance personnel. The position of Head Groundskeeper was eliminated during the past year with the supervisory responsibility being assumedby the senior maintenance person. FACTS: A. Several years ago a decision was made to include St. Augustine grass into the seed mix. St. Augustine shoots a horizontal stem that grows at the rate of ½ inch per 24 hours. With a standard grave stone dimension of 18 inch x 24 inch, St. Augustine shoots can cover a grave stone in less than two weeks. B. As reported by the General Manager, herbicide application is done with a spray gun. Instructions are to spray entirely around the perimeter of the grave stone. C. The South Kern County District Code of Operations does not address rules of decorum for the District’s public meetings. D. Quoting from a UCLA profile study published in 2010, the constituents of the South Kern District are made up primarily of Latinos (76%) the majority of which(62%) have only a “rudimentary understanding of the English language”. E. The available printed materials and the District’s website includes very little contact information. There is a phone number on the front page of the website. The list of Trustees on the website shows no telephone numbers and only a few email addresses, however the District expects complaints to be emailed. F. There is no set written procedure or form for general complaints. The Code of Operations does not cover this subject. G. The Americans with Disabilities Act (ADA) requires that a public restroom be handicapped useable and accessible. Grab bars have been installed in the District restroom. In addition, the ADA defines accessibility as having a minimum 36 inch wide door to the facility. Due to the facility’s age, its door is currently 28 inches wide. H. The cemetery is open on weekends but there are no employees on site. Video cameras are installed at a few places on the cemetery grounds. 139 I. The General Manager is the only management person employed by the District. He therefore represents all of the management functions for the District including business operations, business development and public relations. FINDINGS: F1. The erratic application of herbicide is a result of insufficient tools available to the groundskeepers. Management has not given sufficient thought to the problem. (See photo) F2. The Committee observed that the August board meeting lacked all semblance of decorum. Board members were unable to fully participate in the meeting because the Board President monopolized the discussion. District members had an opportunity to speak if heard over the conversation and comments of other residents speaking at the same time. This finding is consistent with complaints received by district members regardingprevious meetings. F3. The General Manager’s communication style is not easily understood by the general public. Language from the General Manager’s Report for August 16,2015 regarding complaints received is illustrative: “Several items seem to surface that have been particularly vexing. This includes an absence of communicable redress regarding perceived contingencies. Obligational and empirical commitments continuously encapsulate regulatory obligations and make mission objectives seemingly unattainable.” F4. From a survey conducted by the Committee, all four of the public cemeteries visited, including South Kern, have problems to varying degrees with weekend barbeques on the grounds, loud music, public urination, alcohol consumption and vandalism. The hiring of security as a preventative measure is estimated to cost in excess of $40,000 per year. Based on budget constraints, providing this security is not affordable. Good signage, as shown on the photo of the North Kern Cemetery, has been reported to reduce these code violations. 140 F5. There is no contact information on posted signs and very little content on the District’s website to facilitate contact between District constituents, Management or the Board’s Trustees regarding a problem or a complaint. The Committee has heard both the General Manager and the Board Chairman make the comment, “If there is a problem just call me, otherwise, email me.” F6. Management has stated that no complaint will be acted on unless photos and/or other visual evidence are supplied. This, as reported by the Board Chairman, is true of the Kern County Sheriff’s Department as well. Unfortunately, this excludes all violations that are observed but not photographed or otherwise documented. F7. The restroom door on the facility measures 28 inches in width. This is not in compliance with the Americans with Disabilities Act enacted in January 1960. However, since the facility was built prior to 1960, the ADA law does not require compliance unless modifications to the building have been made since that time. F8. Management has found it necessary to close the restroom on weekends due to vandalism. Problems with open fires, alcohol consumption and urination on the cemetery grounds have been reported to occur almost exclusively on Saturday and Sunday. Video cameras have been effective in reducing the number of such incidents. Other than the cameras, there are no security measures on weekends. The fact that the restroom is closed on Saturday and Sunday contributes to the problem with publicurination. F9. It has been reported and discussed in District meetings that the General Manager is not visible and tends to be inaccessible.