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Findings 10 findings
F1
activity, revenue, expenditure, assets, or liabilities. The Grand Jury determined that these Joint Powers Authorities serve no benefit to the public or the taxpayers and have the potential for misuse or obfuscation of public funds.
F2
Horizontal Joint Powers Authorities among peer organizations appear to meet the intent of State laws to delegate a common service for a city or other legal entity for the purpose of reducing cost on behalf of the taxpayers.
F3
Orange County has 18 vertical Joint Powers Authorities created by a city along with its redevelopment agency that no longer exists. The Grand Jury determined Joint Powers Authorities: Issues of Viability, Control, Transparency, and Solvency that these Joint Powers Authorities serve no benefit to the public or the taxpayers and have the potential for misuse or obfuscation of public funds.
F4
Vertical Joint Powers Authorities with a single controlling entity, such as a city council, have the potential to use this organizational structure as a shell company to avoid other legal constraints on the controlling entity and to obfuscate taxpayer visibility.
F5
Vertical Joint Powers Authorities in which the controlling entity transfers assets from itself to a Joint Powers Authority for the purpose of obtaining additional funding, or signs a long-term lease to a Joint Powers Authority to obtain assets, are avoiding transparency and are not acting in the best financial interest of the taxpayers.
F6
32 of the Joint Powers Authorities identified in Orange County are not complying with the California State reporting requirements in code Section 6500 and SB 282 according to the latest information available from the year 2013.
F7
The Orange County Auditor-Controller knows of the Joint Powers Authorities in which the County is a member, but does not have a list of all of the Joint Powers Authorities in Orange County and cannot confirm compliance of their submittal for public access. The Orange County Auditor-Controller does not provide easy- to-use online access to the data submitted to it by the Joint Powers Authorities that are compliant with the requirement to submit.
F8
The Foothill Transportation Corridor Agency and the San Joaquin Transportation Corridor Agency have a joint debt level of over $4.5 billion. The Grand Jury has determined that this debt level is excessive based on their revenues, and it threatens to render them insolvent.
F9
The Orange County Fire Authority has an off-the-books unfunded debt liability of $577 million which the Grand Jury has determined to be of concern since it is a real liability on the County taxpayers.
F10
The Anaheim Pubic Financing Authority has a debt exposure of $1.2 billion which the Grand Jury has determined to be excessive in light of the fact that it was incurred without voter approval. RECOMMENDATIONS In accordance with California Penal Code sections 933 and 933.05, the 2014- 2015 Grand Jury requires (or, as noted, requests) responses from each agency affected by the recommendations presented in this section. The responses are to be submitted to the Presiding Judge of the Superior Court. Based on its investigation titled "Joint Powers Authorities in Orange County," the 2014-2015 Orange County Grand Jury makes the following eight recommendations:
Recommendations 8
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R1All Orange County Joint Powers Authorities that are "inactive" should submit the official paperwork with the State of California requesting termination of their Joint Powers Authorities: Issues of Viability, Control, Transparency, and Solvency existence or provide at the next public meeting the justification for continuing the Joint Powers Authority. (F.1.)
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R2All Vertical Joint Powers Authorities created by a city along with its redevelopment agency should submit the necessary paperwork with the State of California requesting termination of their existence. (F.3.)
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R3All Joint Powers Authorities should take the following actions to insure transparency to the taxpayers: (1) have an annual outside audit, (2) post the complete audit on their city website as a separate Joint Powers Authority entity, (3) send the audit to the County Controller and the State Auditor, and (4) ensure the required reports are filed annually to the County and the State. (F.4., F.5.)
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R4The 32 Joint Powers Authorities that are not complying with the California State Law requiring annual reporting should become compliant by submitting their 2014 report by December 31, 2015, and submitting the required reports annually thereafter. (F.6.)
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R5R6 1 7 City of Anaheim Χ Χ Χ Χ 1 Mayor & City Council City of Brea Mayor & Χ Χ 2 City Council City of Buena Park Χ Χ Χ Χ 3 Mayor & City Council City of Costa Mesa Χ Χ 4 Mayor & City Council City of Fullerton Χ Χ Χ Χ 5 Mayor & City Council City of Fountain Valley Mayor & City Χ Χ 6 Council City of Garden Grove Mayor & City Χ Χ Χ Χ 7 Council City of Huntington Beach Mayor & City Χ Χ 8 Council City of La Habra Χ Χ 9 Mayor & City Council City of Lake Forest Χ Χ 10 Mayor & City Council City of Mission Viejo Χ Χ 11 Mayor & City Council City of San Clemente Mayor & Χ Χ 12 City Council City of San Juan Capistrano Mayor & Χ Χ 13 City Council City of Santa Ana Χ Х 14 Mayor & City Council City of Seal Beach Χ Χ 15 Mayor & City Council City of Stanton Χ Χ Χ Χ 16 Mayor & City Council City of Tustin Mayor Χ Χ Joint Powers Authorities: Issues of Viability, Control, Transparency, and Solvency Required Respondents
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R6City of Westminster Χ Χ Х Χ 18 Mayor & City Council City of Yorba Linda Χ Χ 19 Mayor & City Council Orange County Χ Χ 20 Auditor-Controller Matrix 2 REQUIRED RESPONDENTS (Joint Powers Authorities)
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R7R6 Anaheim Community 1 Х Χ Χ Center Authority Anaheim Housing and 2 Х Χ Χ Public Improve. Auth. Anaheim Public 3 Х Χ Х Χ Χ Χ Χ Financing Authority Big Independent Cities 4 Χ Х Χ Excess Pool Bonita Canyon Public 5 Х Χ Χ Facilities Fin. Auth. Brea Community 6 Х Χ Х Benefits Financing Auth. Brea Public Financing 7 Χ Χ Χ Х Χ Authority Buena Park Public 8 Χ Х Х Χ Χ Χ Χ Financing Authority California Insurance Pool 9 Х Χ Х Authority Capistrano Unified Public 10 Χ Χ Χ Χ Х Х Χ Financing Auth. Central Net Operations 11 Χ Χ Χ Χ Χ Authority City of Brea Midbury 12 Χ Х Х Χ Х Х Assessment Auth. City of Fullerton Public 13 Χ Х Χ Χ Χ Χ Χ Financing Auth. City of San Clemente 14 Χ Χ Х Х Χ Х Χ Public Fin. Auth. Coastal Animal Services Joint Powers Authorities: Issues of Viability, Control, Transparency, and Solvency Required Respondents
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R8Anaheim Pubic Financing Authority under its direction by an aggressive plan to reduce their public debt. (F.10.)
Agency Responses 52
Government agencies' official responses to this report's findings and recommendations. Click on a response to see the structured breakdown.
* This report's PDF did not contain easily extractable text and required Optical Character Recognition (OCR) for analysis. There may be minor errors in the extracted findings and recommendations due to OCR limitations with scanned documents.