Audit Committee

Recommendations 9

• R1
  Child Support Collection Program The Child Support Collection Program (CSCP) is a complex series of subsystems administered by ten Governmental agencies, with the principal roles being performed Superior and Municipal Courts District Attorney (DA) Department of Public Social Services (DPSS) Auditor-Controller/Court Trustee (CT) Data Processing Department (DPD) The following participate in this program to a lesser degree: Probation, Marshall, Sheriff, Bureau of Resources and Collections, and County Clerk. On May 29, 1973 the Board of Supervisors approved the recommendation of the Chief Administrative Officer (CAO) to transfer the Child Support Collection Program en- forcement activities from DPSS to the District Attorney. The DA will begin absorbing DPSS child support unit offices at the rate of one or two offices per month over the next 18 months. By 1975, 26 offices will be absorbed. It is believed that centralized leadership and coordination of the departments involved by the DA are important factors in the success of the program. Full support in terms of the commitment of County resources will be required. An annual review of this program by auditors appointed by the Grand Jury is provided for in Section 10602.5 of the Welfare and Institutions Code of the California Welfare Reform Act of 1971. As instructed by the State Department of Social Welfare, the report on this review is to be presented in two parts: A systems report, briefly outlining the County agencies involved and their re- sponsibilities and performances in the program. A Statistical report (form CA344) for the fiscal year ended June 30, 1973. The current year's review concentrated upon the following three major activities of Case establishment procedures Payment collection and distribution procedures Delinquency identification and processing procedures. In addition, an investigation was made as to the status of the recommendations made by the 1972 Contract Auditor. In this connection, the affected agency's comments and an indication of action taken were included in the 1973 report, and all significant recommendations not resolved have been included as 1973 recommendations. The Contract Auditor's 1973 report concluded that the County's Child Support Collection Program is not operating effectively and efficiently, and specified: "Delinquent payments are not being identified and collected on a systematic Oleveno. Procedures which are susceptible to automation (and cost reduction) are being Data flows are subject to errors and processing delays, and
• R2
  Martin Luther King Jr. General Hospital The first patient was admitted to this hospital in March 1972, and, as expected, there were many initial problems of organization and staffing which normally exist at the inception of a large institution. The Audit Committee selected this unit for review, at this early stage, in the hope that the Contract Auditor would find constructive recom- mendations to assist in the attainment of maximum efficiency. The objective was not 13 to compare operations and statistics in a critical manner with other more mature organizations. The hospital renders services to recipients of public assistance and to the indigent and aged. In early 1972 it was designated as a community hospital. It has also entered into an operating agreement for medical teaching services with Charles R. Drew Postgradu- ate Medical School. Once the organizational phase is completed and the hospital is operating at full capacity, the rates charged are intended to equal the cost of the The initial plans of the hospital provided for a capacity of 394 beds, and the initial availability was 105 beds which has gradually increased to 356 beds as of June 30,
• R3
  Road Department The Road Department is responsible for the construction and maintenance of all roads, bridges, and appurtenance facilities in the unincorporated portions of Los Angeles 15
• R4
  Purchasing and Stores Department In the early months of 1973 the Audit Committee undertook an investigation of a substantial renewal contract awarded by the Purchasing and Stores Department for lamps, based on negotiation rather than by competitive bid. The report on the investi- gation which was filed with the Board of Supervisors recommended, among other things, that the Contract Auditor be instructed to further review the implementation of purchasing policies and procedures, and the documentation for contracts made or renewed on methods other than by formal bid. The review and report by the Contract Auditor was made in compliance with a request by the Board of Supervisors addressed to the Grand Jury. The scope of the review of this department was limited to the areas described above, and in addition a review of purchases when other than the low bidder was selected. It is the stated policy of the department that formal bid procedure is the preferred method of purchase, and that any other means shall be used only in instances when the best interests of the County will be served by using other methods in the carefully considered opinion of the buyer. During the fiscal year ended June 30, 1973, the Purchasing and Stores Department issued 170,866 purchase orders amounting to approximately $127 million and as of February 1973 there were 2,259 actual contracts of which 524 were issued on other than a formal bid (negotiated) basis, as summarized below from an analysis by the Percent to Estimated 1972-1973
• R5
  Department of Public Social Services The Department of Public Social Services (DPSS) is responsible for the administration of categorized and indigent aid and other social welfare programs in accordance with Federal and State laws and County ordinances. DPSS maintains 35 district offices and other sub-offices, and for the year ended June 30, 1973 accounted for 40% of the County's appropriations and 19% of the total County employees funded. The following is a summary of "direct aid payments" with the participation therein, the number of such cases, and administrative expenditures for the three years ended Year Ended June 30, 1971 1972 1973 Participation in direct aid: Federal $355,888,592 $408,224,814 $398,160,021 State 271,688,757 302,172,040 288,071,068 County 166,040,166 146,805,771 153,812,922 Total direct aid $793,617,515 $857,202,625 $840,044,011 Number of direct aid cases 5,060,028 5,138,232 4,926,205 Administrative expenditures $135,149,547 $143,179,034 $154,809,780 After considerable research, in recognition of an urgent need for a highly sophisticated data processing system, the Welfare Case Management and Information System (WCMIS) was designed and approved by the Board of Supervisors on January 18, 1972. The implementation of this system is in progress; however, the passage of H.R.1 by Con- gress has necessitated a change in implementation priorities. H.R. 1 provides for the transfer of administrative responsibility for Adult Aid Programs to the Federal Social Security Administration effective January 1, 1974. A County interdepartmental task force was organized in November 1972 to supervise implementa- tion in the following general areas: case conversion, facilities to be vacated, budget 19
• R6
  Mechanical Department The Mechanical Department's responsibilities include: Repairs, maintenance and security of all County owned and leased buildings and 22
• R7
  Department of Real Estate Management The Real Estate Management Department (REM) has had the responsibilities for: Purchasing or leasing real property. Administering leases of real property from others. Disposing of excess, vacated or abandoned real property. Locating facilities and providing assistance to relocating persons displaced by a Negotiating and administering leases, concessions or franchises awarded to others. Developing, administering, maintaining and providing law enforcement to County Rendering assistance to the Chief Administrative Officer (CAO) in site selection of capital projects. Joint management of the construction of new facilities along with the CAO and the County Engineer. In 1972 studies were made by the Economy and Efficiency Committee, the CAO, the County Engineer, the Real Estate Management Department and several other depart- ments to investigate the problems of County construction programs and facilities management. The recommendations contained in the resulting CAO report were approved by the Board of Supervisors on November 28, 1972. The approved plan is called the Facilities Acquisition and Management System (FAMS) and provides, among other things, for a new Facilities Department whose responsibilities will include the assumption of the REM functions of real property acquisition, sale and leasing services as well as those related to County small craft harbors. The planning and control requirements are to be defined by each of the departments and submitted to the Facilities Department. In order to implement the plan as soon as possible the CAO is serving as the focal point until a director of the new department is selected. It is intended that FAMS will provide a comprehensive inventory and management computer system to serve the Facilities Department. The net expenditures of the REM department for the three years ended June 30, 1973 are listed below: SECTION AND ADDRESS OF Year Ended June 30, 1971 1972 1973 100 Total expenditures $2,048,696 $2,173,528 $2,458,998 Costs applied to other non- Southern out general fund departments 1,461,297 1,612,031 1,770,462 Revenue 4,730 44,807 104,536 Net expenditures 582,669 516,690 584,000 Net appropriations 792,802 769,547 805,783 The scope of the examination by the Contract Auditor was limited to: control and
• R8
  Consolidated Fire Protection District The County Forester and Fire Warden is charged with the duty of supervising all County fire protection districts. The Consolidated Fire Protection District was es- tablished in 1949 by combining various separate districts, and others have been an- nexed since that date. The Consolidated District operates 136 engine companies, 18 truck companies and 27 rescue squads which are located in 128 fire stations. The Consolidated District serves 710 square miles of a total area of 2,169 square miles. The following is a summary of revenue and expenditures for the three years ended Year Ended June 30, 1971 1972 Revenue 1973 $25,205,709 $30,039,027 Expenditures $31,994,069 26,201,171 30,571,984 Excess of expenditures 33,467,690 over revenue 995,462 $ 532,957 The most significant source of revenue is the annual tax levy upon secured and un- secured property located within the Consolidated District. The excess of expenditures over revenues for each of the years was less than the net appropriations in the budget. The scope of the examination was limited to a review of cost allocation procedures, inventory controls, procedures for payroll and purchasing and revenue procedures and The Fire Department, along with other County departments, is reviewing its require- ments to determine the extent to which the Road Department's new Management Information System, particularly automation, can be utilized. As an alternative, an evaluation should be made to determine whether computerized applications are practi- cal using Data Processing Department facilities to replace current manual systems. The Contract Auditor had several recommendations regarding payroll including the suggestion to investigate the replacement of manual payroll records by using a com- plete computer application. There have been two sets of perpetual inventory records. It is recommended that the one kept in the warehouse be eliminated and the other be reconciled to the control account on a regular basis. Small value items should be expensed when purchased and not carried in inventory. Procedures should be established to simplify the review and approval of purchase requisitions.
• R9
  Probation Department The Probation Department is generally performing investigative and supervisory services of juveniles or adults for the judicial branch of government. This Department is the largest in the nation with 4,253 budgeted employees of which 1,842 are Deputy Proba- tion Officers, and as of June 30, 1973 there were 15,051 juveniles and 51,968 adults under probation supervision. The Department operates 4 Field Service Divisions having 17 area offices and 4 specialized offices, 3 Juvenile Halls with detention facilities, 9 camps for boys, 1 girls' school and the Administrative Services Division. The Field Service Division perform two primary functions for both children and adults; they are: Investigation to determine the need for Court action as to disposition of the case. Supervision by Deputy Probation Officers of individuals place on probation by the court. Two of the Juvenile Detention Facilities provide detention, care and treatment of delinquent juveniles, while the third provides such services for dependent and neglected children. A fourth facility, San Fernando Valley Juvenile Hall, was destroyed in the earthquake of February 9, 1971 and has not been replaced to date. Although efforts are being made for both temporary and permanent replacement by the Real Estate Management Department and the Capital Projects Division of the CAO's office re- spectively, it should be noted that over 2-1/2 years have elapsed. The two halls housing delinquent juveniles have a combined capacity of 837 beds, and as of June 30, 1973 the population had increased to 1,149 beds, or 37% over-capacity. In April 1973, the Board of Supervisors approved a master plan of expansion, and to strengthen security, which would: (a) increase capacity of the two halls by 91 beds in 1975 and an additional 411 beds in 1977, (b) provide 200 beds by 1975 for the third hall housing dependent and neglected children, (c) authorize other local facilities for detention of hard-core offenders and (d) replace boys' residence buildings at Central Juvenile Hall by 1976. 28