Waste at the Los Angeles Unified School District

Recommendations 10

• R1

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  1: Require that the Purchasing Branch enforce the District’s restriction on purchasing Top 30 items from sources other than District warehouses by: (a) reviewing P-Card transactions to identify Top 30 purchase violations as part of the P-Card Unit’s audit function; (b) developing and communicating formal, written policies and procedures regarding District non-stock purchasing processes; and, (c) implementing internal management controls to monitor, track, and document staff compliance with and enforcement of these polices and procedures.
• R2

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  1: Direct Inventory Management staff to analyze and quarterly report to warehouse management all warehouse items that have turnover rates of less than one in a year or less than two for two consecutive years.
• R3

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  1: Direct staff to prepare an annual report for management presenting year-to-year gross dollar and commodity unit discrepancies, rather than net discrepancies as is currently reported between inventory records and actual inventory found in the warehouses, as part of the annual Business Service’s Division Service Efforts and Accomplishments. - 166 - 2007-2008 Los Angeles County Civil Grand Jury Final Report
• R4

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  1: The Internal Services Department should review the composition of the County fleet annually to identify the number of vehicles considered to be luxury or over $30,000, and provide the report to the Board of Supervisors.
• R5

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  District $6 to $7 $5.1 Billion $1.5 Billion $600 Million $2.0 Billion $2.2 Billion $7 Billion* Annual Budget Billion
• R6

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  Confirmation No Yes Yes Yes Yes Yes Yes of Warehouse Response Facility * General Fund PART II. Overview of District Warehouse Operations and Funding 7 How many discrete physical warehouse facilities does the District operate? Five Responses: 2= “10 or more” 1= “1” 2= “4” LAUSD: 3 - 244 - 2007-2008 Los Angeles County Civil Grand Jury Final Report 8 Do you operate a warehouse for any of the following purposes? (Check all that apply): Six responses: Field Number Responding “Yes” LAUSD Food/Food 6 (cid:57) Supplies General Stores 6 (cid:57) Salvage 6 (cid:57) Maintenance 6 (cid:57) Other 4 (cid:57) District Responding “Yes” to Other Response Broward County, FL “Food supplies, but not commodities” “Transportation vehicles parts inventory is not included in the data provided. Food cafeteria paper supplies are Miami-Dade included, but not food inventory. Food (frozen, fresh, canned goods) inventory and distribution is outsourced.” “Food Services has a warehouse for storage, PPO has warehouse for receiving, storage and issuing stock. IMC San Diego textbook and library warehouse and Supply Center receiving, stocking and issuing forms and textbooks and salvage material.” Montgomery County, MD “Science kits.” LAUSD Small General Stores satellite at District headquarters. - 245 - 2007-2008 Los Angeles County Civil Grand Jury Final Report 9 Are any of these functions combined into a single facility? If yes, please describe briefly below. Four responses: Number Responding “Yes” 3 District Responding “Yes” Response “One warehouse for each of the following: surplus, Broward County, FL textbooks, transportation parts, operating supplies, stockroom” “Food Services leases a cold storage warehouse and storage warehouse, PPO operates a maintenance warehouse. IMC has a warehouse for textbook, science San Diego kits, library books and Supply Center for stocking, issuing and Receiving Annex for surplus and salvage furniture and for issuing and storing can food products.” “Yes, main general warehouse houses the supplies and Montgomery County, MD furniture operation.” LAUSD General Stores and Foods are located in a single facility. Is the delivery function a part of the District’s warehouse operations or is it separate? Six Responses: 6= “Part of Warehouse Division” LAUSD: “Part of Warehouse Division” - 246 - 2007-2008 Los Angeles County Civil Grand Jury Final Report 11 Do any of the District’s warehouse facilities have an integrated automated warehouse management system (WMS)? Six responses: 4= “Yes” 2= “No” LAUSD: No 12 If YES, please indicate the capabilities of the WMS. Real Time Cycle Order Stock Bar Receiver Responses Inventory Other Counting Picking Replenishment Coding Confirmation Mgmt. Number of 4 4 4 4 4 4 4 Responses Number Responding 2 4 4 4 1 3 2 “Yes” “Others” Responses: “MRP”; “This applies to the supply warehouse only, not furniture.” - 247 - 2007-2008 Los Angeles County Civil Grand Jury Final Report 13 Using the matrix below please indicate (1) which statement best describes your District’s warehouse purchasing policy and (2) what controls are currently being used to enforce this policy. (Check all that apply): Number Responding LAUSD “Yes” District schools and offices are required to purchase all goods from the District's 0 warehouse District schools and offices are required to purchase some goods from the District's 5 (cid:57) warehouse. District schools and offices are not required to 1 purchase goods from the District's warehouse. Monitored Written by Periodic Controls Policies & Training Other Computer Audits Procedures System Number of 5 5 5 5 5 Responses Number Responding 2 4 1 1 1 “Yes” LAUSD (cid:57) “Other” responses: “We carry some forms not sold elsewhere”; “District schools are recommended to purchase goods from the district's warehouse, but it is not policy.” - 248 -
• R10

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  What is the amount and dollar value of each of the following types of products within LAUSD’s warehouses? a. Like products, which are functionally alike but differ in non-functional attributes; b. Obsolete products, which still have functionality but have lost their consumer demand; c. Perishable products, which should not be used after a certain specified date and/or naturally reach an unusable condition; and, d. Lost products, which have gone missing from one inventory cycle to the next due to shrinkage, damage, theft or misplacement.
• R11

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  How much did these products cost LAUSD, and is there any remaining value of obsolete products?
• R12

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  Have policies and procedures been established to limit individual purchases of like products at different prices, dispose of obsolete products or products that have perished, and to minimize the inappropriate loss of warehouse inventory, and are such procedures being followed?
• R13

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  What management systems, reporting processes and internal controls have been established to monitor the level of like, obsolete, perishable and lost products? The scope of the audit covered the questions outline above regarding the District’s warehouse function, including its General Stores, Foods, Maintenance and Salvage Warehouses and Beaudry Street facility, a total of five facilities. Organizationally, these - 159 - 2007-2008 Los Angeles County Civil Grand Jury Final Report facilities are located in the District’s Materiel Management Branch that also contains Stock Purchasing (items in the warehouse), Inventory Management Services, Truck Operations, or delivery services, including a mail unit and a Reprographics unit, and a Marketing division. The Materiel Management Branch is part of the District’s Business Services Division. During the course of this audit, a reorganization took place in which the separate Procurement Services Branch of Business Services, responsible for non- stock purchasing and contracting, was merged with the Stock Purchasing unit, thus becoming part of the Materiel Management Branch. The approved operating budget for the Materiel Management Branch for Fiscal Year 2007-2008 contains $41.2 million in expenditures and 380 full-time equivalent positions, including the Reprographics and Mail units which were not part of this audit scope. Budgeted Fiscal Year 2007-2008 expenditures for the Procurement Services Group, a separate unit at the time the budget was adopted, is $6.4 million. With the merger of the Procurement Services Group into the Materiel Management Branch, the total Fiscal Year 2007-2008 budget would be approximately $47.6 million. The Materiel Management Branch and Procurement Services Group serve all of the District’s schools and offices, all cafeterias and food preparation facilities and the Maintenance and Operations division. Though part of the District’s operations, the disposition of used and old textbooks was not within the purview of the scope of this audit. Tables I.1 and I.2 present Fiscal Year 2006-2007 data on the District’s warehouse inventory and District-wide expenditures by procurement method. Table I.1 District Stock Items Fiscal Year 2006-2007 Average Number of Percent of Warehouse Inventory Stock Items* Total Stock Value* General S1 Stores 3,046 54.4% $9,656,504.40 M10 Maintenance 1,506 26.9% $1,717,894.90 F Foods** 655 11.7% $4,821,031.14 Beaudry BGS General Store 397 7.1% $55,844.03 TOTAL 5,604 100% $16,251,274.47 * Number of Stock Items as of February 13, 2008- excluding BGS (Stock Items by Commodity Code) **Includes F6 Grocery, F6S Staples/Supplies, F6M Meats, and F38P Produce. - 160 - 2007-2008 Los Angeles County Civil Grand Jury Final Report Table I.2 Stock, Non-Stock, and Procurement Card Expenditures Fiscal Year 2006-2007 Type Sub-total Total General Stores $49,873,684 Maintenance $6,600,486 Foods $45,261,399 BGS $525,569 Stock* $102,261,138 Non-Stock** $329,560,916 Procurement Card*** $40,080,736 TOTAL $471,902,790 *Stock total based on stock disbursements as of June 29,2007 (Inventory Turns Report) **Non-Stock total based on Fiscal Year 2006-2007 non-stock requisition data ***P-Card total annualized based on total Fiscal Year 2006-2007 expenditures of $33,400,613.00 from Sept. 2006 through June 2007 END OF INTRODUCTION AND SCOPE. EXECUTIVE SUMMARY FOLLOWS ON THE NEXT PAGE - 161 - 2007-2008 Los Angeles County Civil Grand Jury Final Report Executive Summary This performance audit of the Los Angeles Unified School District’s warehouse Function Department was conducted by Harvey M. Rose Associates, LLC for the Fiscal Year 2007-08 Civil Grand Jury of Los Angeles County. Key findings and the audit recommendations are as follows: Section 1: Required Warehouse Purchases & Like Products District schools and offices are purchasing items from the 30 top selling product (cid:137) categories from outside vendors using District Procurement Cards (P-Cards) in violation of District policy. On average, “Top 30” items purchased from outside vendors cost approximately 40 to 86 percent more than Top 30 items purchased from the General Stores Warehouse, resulting in estimated District-wide excess expenditures of between $1.7 and $2.8 million per year. Though District policy states that P-Card purchases will be reviewed to ensure (cid:137) compliance with the restriction on Top 30 purchases from outside vendors, such monitoring is not being performed by the Purchasing Branch to ensure that these products are not being procured by District staff at higher prices from outside vendors. District policy does not preclude District schools and offices from purchasing non- (cid:137) Top 30 items and like items from outside vendors with their P-Cards or through the non-stock purchasing process, even though the District reports that their prices are an average of 86 percent lower at the warehouse. District records show that such items are being purchased at higher prices with P-Cards and through the non-stock requisition process, resulting in estimated excess costs of $7.7 million per year. District employees are not consistently receiving District-negotiated discounts from (cid:137) non-stock contract vendors when making purchases using their P-Cards. The Purchasing Branch lacks internal management controls to effectively monitor (cid:137) staff compliance with and enforcement of District Top 30 policy and to ensure that appropriate steps are taken by Buyer staff to minimize non-stock purchases of non- Top 30 like items. The Purchasing Branch does not consistently analyze non-stock data for the (cid:137) purposes of identifying items that should be moved into stock. - 162 - 2007-2008 Los Angeles County Civil Grand Jury Final Report Based on these findings, it is recommended that District management should: Recommendation 1.1: Require that the Purchasing Branch enforce the District’s restriction on purchasing Top 30 items from sources other than District warehouses by: (a) reviewing P-Card transactions to identify Top 30 purchase violations as part of the P-Card Unit’s audit function; (b) developing and communicating formal, written policies and procedures regarding District non-stock purchasing processes; and, (c) implementing internal management controls to monitor, track, and document staff compliance with and enforcement of these polices and procedures. Recommendation 1.2: Amend the Top 30 policy to promote greater compliance and to discourage the purchasing of Top 30 and non-Top 30 like and identical items from outside vendors at higher costs by extending required warehouse purchases for all items that fall under the broad Top 30 categories rather than specific products in each category, as is current policy. Recommendation 1.3: Direct Purchasing Branch management to require that all Buyers document and report their contacts with schools and offices to attempt to redirect non-stock requisitions for outside vendors to the warehouse for items identical to or like those available in the warehouse at lower cost. Recommendation 1.4: Require Purchasing Branch management to annually track and report to District management the number and dollar amount of non-stock requisitions that are converted into stock requisitions by non-stock Buyers to avoid purchase of the same or like items that are available from the warehouse at less cost. Recommendation 1.5: Require school principals and office managers to provide District management with written justifications for their purchases from outside vendors at higher cost of items available in the warehouse when they are identified by Purchasing Branch review of detailed P-Card transaction data and/or to surrender their P-Cards in cases of ongoing violations of District policies regarding purchases from the warehouse. - 163 - 2007-2008 Los Angeles County Civil Grand Jury Final Report Recommendation 1.6: Require that the Purchasing Branch ensure that District P-Card holders are consistently receiving discounts from non-stock contract vendors, with the discount received reflected in the detailed P- Card purchase data received from the District’s third party P-Card administrator. P-Card holders should be instructed to routinely inquire about such discounts when making purchases from non-stock contract vendors. Recommendation 1.7: Negotiate with the District’s third party P-Card administrator to provide more detailed information regarding the quantities and unit prices paid for items purchased using District P-Cards for the purposes of tracking employee compliance with the Top 30 and related policies to minimize purchasing costs, to ensure that discounts are being obtained and to identify items that should be moved into stock. Recommendation 1.8: Require that the Purchasing Branch develop polices and procedures for conducting quarterly reviews of the District’s Integrated Financial System (IFS) vendor reports and other applicable non- stock data for the purposes of identifying items that should be moved into stock, including details on how such information will be communicated to inventory management personnel in the Materiel Management Branch. SECTION 2: INVENTORY MANAGEMENT AND ANALYSIS THE DISTRICT IS NOT SYSTEMATICALLY REMOVING LOW TURNOVER, LOW (cid:137) DEMAND ITEMS FROM INVENTORY BASED ON INVENTORY TURNOVER ANALYSES. THE MAJORITY OF ITEMS IN THE GENERAL STORES WAREHOUSE HAD A TURNOVER RATE OF LESS THAN FOUR IN FISCAL YEARS 2006-2007 AND 2005-2006 AND 383 ITEMS IN FISCAL YEAR 2006-2007 HAD A TURNOVER RATE OF LESS THAN ONE. THE HIGH NUMBER OF LOW TURNOVER ITEMS INDICATES OVERSUPPLY IN THE WAREHOUSE OF LOW DEMAND ITEMS THAT SHOULD BE REMOVED TO MINIMIZE WAREHOUSE COSTS AND/OR OVER-ORDERING OF ITEMS THAT ARE IN DEMAND, REPRESENTING SPENDING FOR THOSE ITEMS BEYOND WHAT IS NEEDED, UNNECESSARILY TYING UP DISTRICT CASH. Many warehouse items in the high volume Top 30 selling categories were found to (cid:137) have low inventory turnover rates, indicating over-ordering. Another indicator of this is the average of 4.2 months worth of stock maintained in the warehouse for 239 of the Top 30 items. This appears to be excessive since District policy is to maintain three months worth of stock for each item. Further, most vendors can reportedly - 164 - 2007-2008 Los Angeles County Civil Grand Jury Final Report deliver their orders within one month, indicating that the District quantity ordering policy is also higher than needed. District suggestions that high turnover rates are due to unexpected changes in (cid:137) demand due to grant funded art and sports programs is not supported by inventory data that shows a small percentage of sports and arts supplies had high turnover in FISCAL YEAR 2006-07. The District does not have a systematic analytical approach to adding new items to (cid:137) inventory. Materiel Management Branch (MMB) staff do get suggestions and input from District customers and Buyers but analysis of non-stock and Procurement Card product purchase data are not conducted for this purpose, potentially leaving the warehouse without products that its customers want. Based on these findings, it is recommended that District management should: Recommendation 2.1: Direct Inventory Management staff to analyze and quarterly report to warehouse management all warehouse items that have turnover rates of less than one in a year or less than two for two consecutive years. Recommendation 2.2: Direct warehouse management to develop a policy to remove all items with turnover rates of two or less for two consecutive years unless there are documented unusual circumstances warranting retention of the items. Recommendation 2.4: Direct Inventory Management staff to develop a systematic approach to analyzing District consumption patterns using non- stock requisition and Procurement Card purchase data to identify items being purchased at such a level that it would make economic sense to stock the item in the warehouse. ommendation 2.3: Direct Inventory Management staff to analyze procurement quantities for all warehouse items and to establish lower order quantities for most items based on actual annual disbursement quantities, prices and the cost of storing the items, possibly using a computer-based Economic Order Quantity formula or another structured, systematic, data- based approach. - 165 - 2007-2008 Los Angeles County Civil Grand Jury Final Report SECTION 3: WAREHOUSE MANAGEMENT OF LOST OR UNACCOUNTED FOR PRODUCTS POSITIVE OR NEGATIVE INVENTORY ADJUSTMENTS RESULTING FROM THE (cid:137) ANNUAL PHYSICAL COUNT AND ADJUSTMENTS TO INVENTORY RECORDS MADE THROUGHOUT THE YEAR WERE VALUED AT $2.9 MILLION, OR 18 PERCENT OF AVERAGE INVENTORY VALUE IN FISCAL YEAR 2006-2007. THIS RATE EXCEEDS THE STANDARD INVENTORY ADJUSTMENT BENCHMARK OF TEN PERCENT AND RAISES THE RISK OF THE WAREHOUSES BEING UNABLE TO MEET CUSTOMER DEMAND AND OF THEFT OR MISUSE OF DISTRICT ASSETS. THIS AMOUNT IS NOT REPORTED TO DISTRICT MANAGEMENT TO MEASURE AND IMPROVE ON WAREHOUSE PERFORMANCE. Independent On-site Warehouse Inventory Tests conducted for this audit showed (cid:137) significant discrepancies between the District’s electronic inventory records and amounts found in the warehouses. Staff training for the annual physical count is not sufficient. Ongoing inventory (cid:137) adjustments reported and recorded by warehouse staff are not independently verified by the Job Cost Accounting Section staff to ensure their legitimacy. Order error inventory adjustments are made to electronic inventory records by warehouse staff without review or verification by independent non-warehouse staff. Deficiencies were found in the order filling processes at each warehouse with (cid:137) potential impact on the accuracy of inventory records maintained electronically. These deficiencies include: the absence of verification of order accuracy in the individual commodities being shipped from the warehouses; and, a computer inventory tracking system that is often inconsistent with the actual movement of inventory. The District’s Maintenance Warehouse must use two separate computer systems to (cid:137) process Maintenance Warehouse stock orders and inventory adjustments. Based on these findings, it is recommended that District management should: Recommendation 3.1: Direct staff to prepare an annual report for management presenting year-to-year gross dollar and commodity unit discrepancies, rather than net discrepancies as is currently reported between inventory records and actual inventory found in the warehouses, as part of the annual Business Service’s Division Service Efforts and Accomplishments. - 166 - 2007-2008 Los Angeles County Civil Grand Jury Final Report Recommendation 3.2: Direct staff to prepare formal written policies and procedures to improve internal controls over the annual physical count including enhanced staff training for the process, adding periodic cycle counts to the control processes where randomly selected items are spot counted during the year and enhanced documentation and independent verification by the Job Cost Accounting Section of all inventory adjustments resulting from the annual physical count and others proposed during the year by warehouse staff. Use of outside contractors for the annual inventory count should also be considered. Recommendation 3.3: Delegate responsibility to the Materiel Management Branch and warehouse managers to reduce the gross discrepancy levels at the warehouses from the current 18 percent to at least 10 percent and preferably lower over the next two years and to submit written reports to executive management once a year on progress in accomplishing this goal. Recommendation 3.4: Direct warehouse management to develop a formal data entry process and inventory controls for the District’s Integrated Financial System (IFS) electronic inventory management system and for each warehouse’s order filling procedures, starting with the entry point of an order by a customer to creating greater accuracy checks against item control sheets and detailed item pick and issue tickets generated by IFS and performing and documenting spot checks for order accuracy before orders are shipped from the warehouses. Recommendation 3.5: Direct Materiel Management Branch staff to determine the costs and benefits of modifying the Maintenance Warehouse’s MAXIMO software so that Maintenance inventory order data is recorded in sufficient detail and merged with IFS to ensure that consistent and accurate inventory updates are made in both systems. - 167 - 2007-2008 Los Angeles County Civil Grand Jury Final Report SECTION 4: MANAGEMENT OF OBSOLETE ITEMS IN THE SALVAGE WAREHOUSE Warehouse staff currently do not electronically compile or keep track of a tally of the (cid:137) salvage/obsolete items that are delivered to the warehouse, resulting in a lack of a formalized accounting of the number, types, and values of the obsolete and salvage materials and equipment delivered to the Salvage Warehouse. Currently, the only tracking system in place involves the filing of the physical copies of the Transportation Order forms, which are grouped alphabetically by school sites and by fiscal quarter. The Salvage Warehouse lacks formal policies and procedures for reconciling the (cid:137) number of items picked-up at the schools and offices with the number of items that are actually delivered to the Salvage Warehouse. As such, no formal accounting of salvage and obsolete items takes place, which increases the risk of misuse or theft of salvage and obsolete items. Similarly, some items that schools or offices have requested for pick up are not delivered to the Salvage Warehouse without documented explanation. The District’s Salvage Warehouse lacks policies and procedures for how to group (cid:137) and classify salvage and obsolete items received at the Salvage Warehouse, increasing the risk of misuse or theft of such items. Formal standards are not in place for determining which materials should be dumped, recycled, sold or auctioned, or retained by the warehouse staff for reuse by other District schools and offices. The District lacks standards for how Salvage Warehouse staff assigns base asking (cid:137) prices to items that are to be sold or auctioned. Base prices are established solely based on staff’s opinion of the value of items to be sold, potentially resulting in under- or over-valuing District assets. The Salvage Warehouse will lose approximately $300,000 in revenue in Fiscal Year (cid:137) 2007-2008, or approximately 61 percent of its total revenue, previously generated from auctioning District computers and peripherals. The District now has entered in to an agreement transferring that equipment to Apple Computer, Incorporated who has guaranteed that no confidential data from the devices will be released and all equipment will be disposed of without environmental harm. District staff could not report if the benefits of this new arrangement offsets the loss in revenues, which will increase the net costs of warehouse operations. District contracts for hauling and wood disposal were not reviewed as they could not (cid:137) be produced by District staff. - 168 - 2007-2008 Los Angeles County Civil Grand Jury Final Report Based on these findings, it is recommended that District management should: Recommendation 4.1: Establish formal and consistent written policies and procedures for tracking and processing items that were not picked-up by the drivers or where quantities delivered are different than the amount originally requested by the District school or office. Recommendation 4.2: Establish and implement written policies and procedures that include guidelines for systematically and electronically keeping a tally and tracking information regarding all salvage and obsolete items that are delivered to the Salvage Warehouse. At a minimum, the District should electronically input the following information from the Transportation Order forms: (a) item description; (b) serial numbers; (c) the quantity entered by the school/office; (d) the quantity that actually arrived at the warehouse; (e) consistent grouping classification; (f) relevant date; and, (g) form numbers. The Salvage Warehouse should then use these Transportation Order data to keep track of the items on an ongoing basis and generate reports on Salvage Warehouse items and activities. Recommendation 4.3: Establish standards for assigning base asking prices to items that are to be sold or auctioned to continue the feasibility of meeting the 50 percent cost recovery goal from auction revenues of operational costs. Recommendation 4.4: Conduct a cost-benefit analysis of alternative options to destroy end-of-life electronic assets in an environmentally-sound manner, with the goal to determine ways to recuperate the lost auction revenue associated with computer and electronic sales. Recommendation 4.5: Establish contracts with one or more vendors governing hauling and wood disposal. Table E.1 on the next page presents a summary of estimated savings resulting from implementation of the audit recommendations. As shown, estimated one-time savings are between $390,000 and $1.1 million. Estimated annual savings are between $10.7 and $11.8 million per year. Additional savings are possible because some of the audit analysis that the estimates are based on stemmed from limited samples. - 169 - 2007-2008 Los Angeles County Civil Grand Jury Final Report Table E.1 Estimated savings based on audit sample and other analyses Estimated Estimated one- annual Recommendation time savings* savings* 1.1: Require that the Purchasing Branch enforce the District’s restriction on purchasing Top 30 items from sources other than District warehouses by: (a) reviewing P-Card transactions to identify Top 30 purchase violations as part of the P-Card Unit’s audit $1.7 - 2.8 function; (b) developing and communicating million/year+ formal, written policies and procedures regarding District non-stock purchasing processes; and, (c) implementing internal management controls to monitor, track, and document staff compliance with and enforcement of these polices and procedures. 1.3: Direct Purchasing Branch management to require that all Buyers document and report their contacts with schools and offices to $7.7 attempt to redirect non-stock requisitions for million/year+ outside vendors to the warehouse for items identical to or like those available in the warehouse at lower cost. 2.3: Direct Inventory Management staff to analyze procurement quantities for all warehouse items and to establish lower order quantities for most items based on actual $390,000 - $1.1 annual disbursement quantities, prices and the million+ cost of storing the items, possibly using a computer-based Economic Order Quantity formula or another structured, systematic, data- based approach. 3.3: Delegate responsibility to the Materiel Management Branch and warehouse managers to reduce the gross discrepancy levels at the warehouses from the current 18 $1.3 percent to at least 10 percent and preferably million/year lower over the next two years and to submit written reports to executive management once a year on progress in accomplishing this goal. $390,000 - $1.1 $10.7 – 11.8 Total million+ million/year+ * A + sign indicates that the estimated savings were based on analysis of a limited sample and that the actual savings could be greater. END OF EXECUTIVE SUMMARY METHODOLOGY SECTION FOLLOWS ON THE NEXT PAGE - 170 - 2007-2008 Los Angeles County Civil Grand Jury Final Report