Santa Cruz County 2010-2011 - California Grand Jury Reports

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April 26, 2011 — How to Catch the RecoveryWave RecoveryWave.com

42 pages 9 findings 5 recommendations

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Findings & Recommendations 9 findings

F1: The information included in the RecoveryWave.com web page describing each of the listed residential treatment facilities is incomplete, inconsistent, and contains inaccuracies. For instance, the information associated with some RTFs does not include a contact person, and some listings include fees but the stated fees are incorrect. In fact, for one treatment facility 38 ∫ Santa Cruz County Grand Jury Final Report 2009-2010 the fees were understated by $10,000. Updates are handled haphazardly. Some but not all information might be updated to reflect current circumstances. Information on two RTFs was left on the web site long after the facilities had closed. County Response: Santa Cruz County Board of Supervisors – PARTIALLY AGREE The County Alcohol and Drug Program’s (ADP’s) Resource Directory was used as the source of information for RecoveryWave.com. ADP’s past practice has been to update the Resource Directory information annually and as specific notifications of changes are received. However, due to budget constraints and County hiring freezes, the position responsible for updating the Resource Directory was vacant for over a year. When the position was eventually filled in January 2010, one of the new staff member’s first projects was to update the resource directory, and this information was included in the RecoveryWave.com website. The County Alcohol and Drug Program intends to resume its practice of comprehensively updating the resource directory annually and as notifications of changes are received, and will share this information with the Commissioner who has volunteered to update the RecoveryWave.com website.

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R1: The Health Services Agency of Santa Cruz County and The Alcohol and Drug Abuse Commission should review the RecoveryWave.com web site and verify the accuracy of the information provided by the Grand Jury on the residential treatment facilities for inclusion on the web site. They also should establish a clear strategy for ongoing, timely updates and corrections of RecoveryWave.com. County Response: Santa Cruz County Board of Supervisors – HAS BEEN IMPLEMENTED This recommendation has been implemented. Now that a long-term clerical vacancy has been filled, the County Alcohol and Drug Program has resumed its past practice of comprehensively updating the resource directory annually and as notifications of changes are received. This updating process relies on treatment programs to provide accurate information. These updates and changes are routinely incorporated into the RecoveryWave.com website by the Commissioner who has volunteered for this task.

F2: At present there is no system in place to periodically correct and update RecoveryWave.com. It is not clear whether this responsibility lies with ADAC or with HSA. Also, there currently is no system interface between the RecoveryWave.com web site and a resource directory maintained by HSA. County Response: Santa Cruz County Board of Supervisors – DISAGREE As indicated above, after an extended vacancy in the position responsible for updating the Resource Directory, the County Alcohol and Drug Program has resumed periodic updates of the Resource Directory. Updates are shared with a member of the Alcohol and Drug Abuse Commissioner who has assumed the responsibility for updating the website content. Although it was the website creator’s intention that the website would replace the Resource Directory, the Resource Directory fills the need for a hard copy handout to professionals and members of the public.

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F3: Personnel not trained in the complex issues of alcohol and drug addiction answer calls on the 454-HELP line. Occasionally calls are transferred to experienced personnel. County Response: Santa Cruz County Board of Supervisors – PARTIALLY AGREE Sufficient resources do not exist to have all calls responded to by trained clinicians. Most calls are handled by clerical staff, who are trained to respond to requests for basic information about treatment program services, contact information, etc. Calls requiring a clinical response are transferred to experienced clinical staff.

F4: The entire RecoveryWave.com web site is available in Spanish, except for the disclaimer. Again, these translations were accomplished by a few dedicated employees of HSA. The Grand Jury had the opportunity to ask about these translations during its survey of the RTFs. It appears that some of the translation needs editing and rewording. County Response: Santa Cruz County Board of Supervisors – PARTIALLY AGREE HSA’s Spanish language Resource Directory listings were used in creating the Spanish version of RecoveryWave.com. Translation of original text created for the site was performed by a bilingual commissioner with the help of a Si Se Puede staffer. How to Catch the RecoveryWave ∫ 39 Disagreements on the quality or exactness of translations are not uncommon, and periodic review and updating of translations are useful. Endorsement and Disclaimer Part of the mission statement of ADAC is to promote “high quality public and private programs to eliminate alcohol and other drug abuse in the county.” To this end ADAC is enjoined to: “Encourage and educate the public to understand the nature of alcoholism and other drug dependencies and alcohol and other drug abuse programs; and encourage support throughout the county for development and implementation of effective alcohol and other drug prevention, intervention, treatment and recovery programs.” The Commission has responded to this mandate well with the development of RecoveryWave.com. ADAC promotes all programs, public and private, those with religious ties and those without, in an effort to serve as many people as possible. This is in keeping with the mission statement of HSA to promote community health in the public and private sectors. Thus, RTFs are listed on RecoveryWave.com as a service to the county without the intent to validate or endorse the programs. While the community service aspect of RecoveryWave.com is clearly mandated by HSA and ADAC, the County also needs to limit its exposure to legal liability. To that end RecoveryWave.com includes a link to a disclaimer found in small print at the bottom of the home page only. This disclaimer includes sections covering liability with the phrase “use at your own risk” with language releasing the County from fault. The disclaimer is in English only, even on the Spanish translation pages.

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R2: HSA and ADAC should evaluate and, if necessary, revise the Spanish translations on RecoveryWave.com for best content and grammar. They also should provide a Spanish translation of HSA’s disclaimer. County Response: Santa Cruz County Board of Supervisors – HAS NOT YET BEEN IMPLEMENTED BUT WILL BE IMPLEMENTED IN THE FUTURE This recommendation will be implemented by October 1, 2010 or sooner.

F5: HSA and ADAC are actively carrying out the mandate to educate the public and promote alcohol and drug treatment programs with RecoveryWave.com. The seeming appearance of endorsement by the County could be viewed as an unintended consequence of this public service role. The English-only disclaimer on RecoveryWave.com provides the County legal protection from misuse of the web site information. There is tension between the mandate to provide information to the public and the exposure of the County to the misuse of the information. This leads to a lack of clarity about County support and the appearance of an endorsement of the private programs included on RecoveryWave.com. County Response: Santa Cruz County Board of Supervisors – PARTIALLY AGREE The disclaimer on the website specifically states, “This site and its content are provided on an ‘as is’ basis. The County of Santa Cruz to the fullest extent permitted by law, disclaim all warranties, either express or implied, statutory or otherwise, including but not limited to the implied warranties of merchantability, non-infringement of third parties rights, and fitness for any particular purpose.” Furthermore, the website only indicates that the recovery programs listed are available, and makes no statements of endorsement. However, the County agrees that it is possible, despite the above disclaimers, that a member of the public could misconstrue listing of a program on the website as an endorsement by the County, and agrees that the disclaimer is not in Spanish. 40 ∫ Santa Cruz County Grand Jury Final Report 2009-2010 Santa Cruz County Funding for Individuals in Residential Treatment for Alcohol and Drug Addictions In addition to the information gathered about the residential facilities, the Grand Jury interviewed County officials to understand the nature and extent of the funding from the County to the RTFs. With the severe budgetary cutbacks of recent years, there has been a drastic reduction in County support for residential treatment. In many cases funding cuts have meant the curtailment of programs, leaving some special populations without residential treatment entirely. In other cases programs have been shortened to the extent that there is insufficient recovery time. Personnel of the County and those RTFs receiving public support emphasized the difficulty in helping individuals with their addictions when the programs are severely shortened. Providing no support for the most vulnerable populations, like the dual-diagnosed or serial inebriates, presents a challenge for the County.

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R3: HSA and ADAC should clarify the appearance of County endorsement for the treatment facilities listed at RecoveryWave.com with a simple and prominent statement of intent. They also should make the existing link to the HSA disclaimer more obvious. County Response: Santa Cruz County Board of Supervisors – HAS NOT YET BEEN IMPLEMENTED BUT WILL BE IMPLEMENTED IN THE FUTURE This recommendation will be implemented by October 1, 2010 or sooner.

F6: Santa Cruz County provides critical financial support for Santa Cruz residents in treatment at Janus, Janus Perinatal (formerly Mondanaro-Baskin), New Life Center, Santa Cruz Residential Recovery, Sí Se Puede, and Tyler House. Because of the budget constraints, the County has shortened the length of stay it will support for an individual in residential treatment. With the closure of Paloma House and Las Hermanas, two populations often underserved have had resources disappear. At present there is no County support for residential treatment for serial inebriates. County Response: Santa Cruz County Board of Supervisors – AGREE Since the time the Grand Jury report was prepared, the County, in partnership with the City of Santa Cruz, Dominican and Sutter Hospitals, and the Central California Alliance for Health, has reinstated the Serial Inebriate Project, which provides residential treatment for serial inebriates.

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R4: The Santa Cruz County Board of Supervisors should become more aware of the residential treatment facilities and provide access to relevant facilities for the underserved populations of dual-diagnosed persons and serial inebriates, and they should press the State to reinstate funding for treatment programs. County Response: Santa Cruz County Board of Supervisors – HAS BEEN IMPLEMENTED The County Board of Supervisors is very aware of the residential treatment facilities and, within the constraints of available funding, intends to maintain and increase access to under-served persons with dual diagnoses and serial inebriates. As mentioned above, the How to Catch the RecoveryWave ∫ 43 County, in partnership with key stakeholders, has re-instated the Serial Inebriate Project. The County continues to advocate with the State to preserve and expand funding for alcohol and drug treatment programs.

F7: Adolescents with addiction problems can be treated at Tyler House, often at no cost to their families. Importantly, the program is structured and of sufficient length to promote recovery. Students residing at Tyler House are able to continue their education at La Escuela Quetzal, a sober school adjacent to the house on the same property. Tyler House is not well-known and is underutilized. County Response: Santa Cruz County Board of Supervisors – PARTIALLY AGREE Tyler House is very well known to its primary referral sources (Probation, Children’s Mental Health, and the Alcohol and Drug Program) and is seeking to be better known by the general public. Although the occupancy rate at Tyler House is typically high, it dipped between January and June of 2010 due to clients with more difficult behavior problems being placed in the program who exited the program earlier than anticipated. Tyler House is working with the Probation Department to coordinate referrals of clients who are more appropriate for the program. The Role of the Alcohol and Drug Abuse Commission (ADAC) The Grand Jury found that ADAC has been dedicated in assisting the Santa Cruz County Health Services Agency in its efforts to stem alcohol and drug abuses. Historically, there have been times when ADAC has had to operate without a full panel of representatives. How to Catch the RecoveryWave ∫ 41

F8: HSA has been handicapped by a lack of resources to promote broad awareness of RecoveryWave.com in the Santa Cruz county community, especially to those in critical and immediate need of support and information. County Response: Santa Cruz County Board of Supervisors – AGREE The County supported the Commission’s early promotion efforts, including paying for the printing of 11”x14” color posters and 8”x11” color flyers in English and Spanish. Commissioners, HSA personnel and members of the recovery community helped distribute the promotional materials, and the Commission issued press releases regarding the website. However, in recent years resources have not been available to support these public awareness efforts. The English version of the site has received 16,220 page loads (hits) since the Commission began accumulating data on the site on February 15, 2009. The site’s average daily hit count has increased 17.5 percent, from 28.5 hits in 2009 to 33.5 hits through July 21, 2010. The Spanish language site draws significantly fewer visitors, with 3,405 total hits during the same time period.

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R5: The Santa Cruz County Board of Supervisors should fund HSA’s efforts to make the public aware of county treatment resources through use of the RecoveryWave.com web site. County Response: Santa Cruz County Board of Supervisors – HAS BEEN IMPLEMENTED Through funding provided to the HSA Alcohol and Drug Program, the Board of Supervisors has implemented this recommendation, including provision of timely updates of the treatment resources listed on the RecoveryWave.com website. In addition, the implementation of the county-wide 211 information referral line will help guide the public toward the RecoveryWave.com website.

F9: Both HSA and ADAC have voiced their willingness to accept the recent work of this Grand Jury on the residential treatment facilities as a resource both for HSA and for addition to the RecoveryWave.com web site. County Response: Santa Cruz County Board of Supervisors – AGREE The County agrees with this finding and thanks the Grand Jury for the thorough review of the website. The Commission is dedicated to maintaining an accurate, up-to-date, robust and informative website, consistent with the needs of the community and within budgetary constraints. Conclusions C1. The RecoveryWave.com web site does not include adequate information to help individuals make an informed decision when choosing a residential treatment facility in Santa Cruz County. C2. Santa Cruz County funding for residential treatment for individuals with drug and alcohol addictions has been cut back to such a severe degree as to deny treatment to many of the most vulnerable, such as the dual-diagnosed and serial inebriates, and to hamper recovery for many others because of shortened programs. Most of the funding available to Santa Cruz County for all these programs has been provided by the State. The drastic reduction in State support has severely affected programs within Santa Cruz County. C3. Despite the presence of a lengthy disclaimer on RecoveryWave.com, there is the appearance of endorsement of the programs listed on the web site by the County Health Services Agency and the Alcohol and Drug Abuse Commission. C4. The Santa Cruz County Board of Supervisors has provided limited support for promoting its public service web site, RecoveryWave.com. 42 ∫ Santa Cruz County Grand Jury Final Report 2009-2010 C5. Because of issues with the Spanish translation and the lack of a disclaimer in Spanish, the usefulness of the web site for Spanish speakers is compromised. C6. The disclaimer is nearly hidden in tiny type at the very bottom of the home page only, and a web site user is not easily aware of the cautionary remarks by the HSA.

April 26, 2011 — • Has Not Yet Been Implemented but Will Be Implemented in the Future, with a timeframe or expected date for

1 pages

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Findings and recommendations not yet extracted.

April 26, 2011 — Penal Code § 933.05 1. For purposes of subdivision (b) of § 933, as to each Grand Jury finding, the responding person

1 pages 3 recommendations

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Additional Recommendations 3

Not linked to specific findings.

R4: A Grand Jury may request a subject person or entity to come before the Grand Jury for the purpose of reading and discussing the findings of the Grand Jury report that relates to that person or entity in order to verify the accuracy of the findings prior to their release.

R5: During an investigation, the Grand Jury shall meet with the subject of that investigation regarding that investigation unless the court, either on its own determination or upon request of the foreperson of the Grand Jury, determines that such a meeting would be detrimental.

R6: A Grand Jury shall provide to the affected agency a copy of the portion of the Grand Jury report relating to that person or entity two working days prior to its public release and after the approval of the presiding judge. No officer, agency, department or governing body of a public agency shall disclose any contents of the report prior to the public release of the final report. viii

April 26, 2011 — Saving the Branches May Kill the Tree The Fate of the Santa Cruz City/County Public Libraries

26 pages 27 findings 10 recommendations

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Findings & Recommendations 27 findings

F1: Including the three new libraries described below, the Master Plan calls for the construction of over 34,000 square feet of library space over the next several years. • Capitola was without a library from the mid-1970’s, when the original library was closed due to Proposition 13 cutbacks, until 1999, after the passage of the Measure B sales tax for the libraries. The current library is considered an interim library; it’s about 4,300 square feet and is not a permanent building but rather six portable structures tied together by the roof and floor. In 1987 Capitola signed a redevelopment agreement with the County that obligates the city to begin construction by 2018 of a 7,000 square foot facility that the SCPL would operate. Response: Joint Powers Authority Board – PARTIALLY AGREE The Capitola agreement was first signed in 1984. Saving the Branches May Kill the Tree ∫ 147 Response: Santa Cruz City/County Public Libraries – PARTIALLY AGREE The Capitola agreement was first signed in 1974. • The Felton library is a 1,250 square foot deconsecrated church. There is no disabled access, staff workspace, or storage area. There is only street parking. The entrance is up two flights of hillside stairs, making access difficult for parents with young children and seniors. There is little space for comfortable seating or study carrels. Public school class visits are not possible due to the small space. The collection is small, crowded, and inadequate. Nevertheless, the Felton library has a community of fierce supporters. Due to the gross inadequacies of the facility the JPB adopted a resolution in April 2008 identifying the Felton branch as the SCPL’s highest capital project priority, planning an 8,800 square foot facility for the area population of 16,000. However, despite a bequest of $146,000 and the donation of the land for the library, it is estimated that another $5.5 million might be needed to actually build the library. Response: Joint Powers Authority Board – PARTIALLY DISAGREE The area population that will be served by the new Felton Branch is 30,000. This includes all of San Lorenzo Valley and parts of Bonny Doon. There has been no official cost estimate for construction. Response: Santa Cruz City/County Public Libraries – PARTIALLY AGREE We have done a bit of “remodeling” and opened up space. The collections are not crowded anymore. It is also not inadequate for the size building it is and patrons have the system collection at their fingertips. There are book discussion groups and story times that do meet in this facility. Class visits might be possible depending on the size of the class. • Scotts Valley has had a library since 1953. The branch currently occupies 5,300 square feet rented in a shopping center. However, within the next year the library will be moving to a space of about 12,500 square feet in a remodeled building the city of Scotts Valley has purchased through a redevelopment agreement with the County. The Scotts Valley chapter of the Friends of the Library has launched an ambitious campaign to raise $250,000 to outfit the library interior. Response: Joint Powers Authority Board – PARTIALLY DISAGREE The new library will be 13,150 square feet. The base bid will cover a great deal of the interior. The Scotts Valley Redevelopment Agency is covering the new costs of the exterior and interior of the new library except for a fireplace/community art book wall project, media wall and other “extras” being funded by groups such as the Scotts Valley Chapter of the Friends of the Library. Response: Santa Cruz City/County Public Libraries – PARTIALLY DISAGREE The new library is actually 13,150 square feet. The base bid will cover a great deal of the interior and is paid for by The Scotts Valley Redevelopment Agency. The Scotts Valley Chapter of the Friends is fundraising for additional items.

F2: In addition to the capital improvements described in F1 above, there are the routine maintenance and extraordinary repairs required by the library facilities and vehicles. In just the last few months, the library staff had to deal with: 148 ∫ Santa Cruz County Grand Jury Final Report 2009-2010 • a leaky roof affecting a light panel in Capitola, which caused the staff to delay opening the library for the day because of safety concerns • cleanliness and plumbing problems in Branciforte and Capitola • a T1 data line in Capitola malfunctioning for three days, resulting in 42 crates and 6 book trucks of materials needing to be transported to Live Oak for processing • lights and alarms causing problems in Live Oak from October 2009 to January 2010 • the need to install an underfloor water detection system at Live Oak • the heating/air conditioning system in Live Oak is a perpetual problem • irrigation problems at Live Oak that have resulted in high water bills • a leaky window and graffiti in Garfield Park • the bookmobile out of service twice in two months because of transmission problems • electric bills for headquarters that are unexpectedly high No Response Required

F3: The community of La Selva Beach, unhappy with the local branch schedule and concerned that the SCPL’s financial problems might trigger the decision to close the branch altogether, proposed that its Friends chapter might fund the purchase of self checkout equipment and supply volunteers who, after training, would supplement the staff and allow the library to be open more hours. While library policy requires at least two employees to staff any open library, the hope was that administration would agree that one employee, self checkout, and a volunteer might be adequate. Administration did agree and this proposal is under development; union agreement is necessary for implementation. Response: Joint Powers Authority Board – PARTIALLY AGREE The pilot program has been launched as of July 2010. La Selva Branch is now operating 14 hours a week with one SCPL employee and one volunteer provided by the La Selva Beach Chapter of the Friends of the Library. Response: Santa Cruz City/County Public Libraries – PARTIALLY AGREE The Santa Cruz Public Library Friends funded self check machines for the entire system not the local chapter. The only reason La Selva can operate with one staff and one volunteer is because volume of circulation is so low that only one staff member is needed. The volunteer is there for “security” purposes, not to provide direct public service. The Technology Library staff have stated that the SCPL is the last in the country to use the current Integrated Library System (ILS). It was installed in the 1980’s and updated/upgraded twice in the 1990’s. It is an outdated but heavily customized system on dedicated, obsolete hardware (with no support from the manufacturer at this point in time), with only a single employee with the expertise to maintain the system. This means there are multiple points of failure: hardware, software, and personnel.

F4: Technical services staff state that library technology has been under-funded for several years, perhaps by as much as $500,000 to $700,000 per year. Response: Joint Powers Authority Board – DISAGREE Saving the Branches May Kill the Tree ∫ 149 Without specific information regarding the time period and the specific items underfunded, the LJPB cannot comment on the accuracy of this finding. Response: Santa Cruz City/County Public Libraries – PARTIALLY DISAGREE First, I believe this is meant to be Library Information Technology staff not Technical Services. They are two different divisions. I am not sure where that number comes from. We estimate that $100,000 is needed for PC replacement each year. A new ILS is in the neighborhood of $200,000 but is a one time expenditure with annual maintenance fees of about $30,000.

F5: A new ILS, which could cost upwards of $200,000, would enable several improvements in library operations, such as the adoption of the floating collection, now considered a library “best practice”; computer-printed hold slips (library staff handwrite over 200,000 hold slips annually); and automated check in. Response: Joint Powers Authority Board – PARTIALLY DISAGREE Automated check in is not dependent on a new ILS. Response: Santa Cruz City/County Public Libraries – PARTIALLY DISAGREE Floating collections are not considered a best practice. It is something that works in some systems but is not at the level of a best practice. It does hold some promise for a system of our size, however. Automated check in is not dependent on a new ILS.

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R1: The Santa Cruz Public Libraries should replace its Integrated Library System immediately. This will avoid the catastrophe that would occur if the current system suffers a terminal failure. An up-to-date ILS also will allow the automation of many activities presently being handled manually, as well as enable activities just not possible at all today. Response: Joint Powers Authority Board – HAS NOT BEEN IMPLEMENTED BUT WILL BE IMPLEMENTED IN THE FUTURE The Library is currently researching ILS systems. Implementation is planned for the fiscal year 2010/11. Response: Santa Cruz City/County Public Libraries – HAS NOT BEEN IMPLEMENTED BUT WILL BE IMPLEMENTED IN THE FUTURE This is currently planned for fiscal year 2010/11.

F6: Only three libraries in the SCPL system currently offer self checkout: Aptos, Live Oak, and Scotts Valley. Sadly, very few people are using it, just about 8 % of patrons compared to 60% in Watsonville and Los Gatos and about 95% at the San Jose libraries. Efforts to convert to self checkout have been handicapped by the need to add barcode labels to outside book covers, a time-consuming and costly exercise; labels originally were put inside the books. Response: Joint Powers Authority Board – PARTIALLY DISAGREE Live Oak self check is currently at 84%. A rollout plan is underway whereby all branches will be using self checkout by December 2010. Rebarcoding is taking place at each branch prior to implementation of self check. Response: Santa Cruz City/County Public Libraries – PARTIALLY DISAGREE Live Oak has achieved 84% self checkout since it was instituted in a serious way in April 2010. There is a rollout plan whereby all branches will be using self checkout by December 2010. Previous attempts to do so had many barriers which are being corrected. Rebarcoding is happening just before each library goes to self check. We are using ARRA paid workers through September and then volunteers. I question the 95% figure. The industry benchmark is 80%. San Jose does have the advantage of an aggressive building program which enabled them to build branches with self checkout integrated into the design. Scotts Valley will be built to this standard.

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R3: The SCPL should buy and install self checkout equipment at all the regional branches – buying the best units possible in sufficient quantity to accommodate all book and material checkout – and then aggressively promote its use to get close to the 95% use levels enjoyed by the San Jose libraries. Response: Joint Powers Authority Board – HAS BEEN IMPLEMENTED Scheduled completion is slated for December 2010. Response: Santa Cruz City/County Public Libraries – HAS BEEN IMPLEMENTED (Scheduled for completion in December 2010): There is currently a plan to have self check in place with rebarcoding done by December 2010. Even with that I doubt we will achieve 95% self checkout. The industry benchmark is 80%. Until fines can be paid at the self 162 ∫ Santa Cruz County Grand Jury Final Report 2009-2010 checks we will not likely exceed 80% and that is not being planned until after a new ILS is in place. It should be noted that when we do achieve 80-95% self check, the remaining transactions will be much more complicated and will definitely require staff to handle them; not volunteers.

F7: The SCPL has about 150 computers in the ten branches for public use. This number of computers compares favorably with comparable library systems. The technology 150 ∫ Santa Cruz County Grand Jury Final Report 2009-2010 department is in the process of slowly replacing old equipment with newer refurbished terminals with multimedia capability. Response: Santa Cruz City/County Public Libraries – AGREE

F8: The new Scotts Valley library is anticipated to be the first “real 21st century” library in the SCPL system. There will be lots of computers, with both wired and wireless connection to the internet, lots of bandwidth, and fiber. There will be two large LCD presentation screens and projection equipment. There will be single point of service and four self checkout stations, and space for automated materials handling equipment, although this equipment will not be purchased at this time. Response: Santa Cruz City/County Public Libraries – PARTIALLY DISAGREE All our branches offer wireless capabilities. The LCD screens and projection equipment are dependent on Scotts Valley Friends fund raising. Volunteers Library volunteers are members of the Friends of the Santa Cruz Public Libraries, and in 2008/09 560 volunteers worked over 14,000 hours in the libraries, equivalent to seven FTE. They also gave the libraries more than $200,000 last Friends’ fiscal year and have pledged another $52,000 to buy new self checkout machines. There are branch-specific Friends chapters in Boulder Creek, Felton, La Selva Beach, and Scotts Valley. The Scotts Valley chapter has just begun a capital campaign to raise $250,000 for equipment and furnishings for the new Scotts Valley library, and the parent chapter is beginning an ambitious campaign to raise funds for technology improvements and other needs of the library system. The money will be useful, but library supporters wonder why volunteers cannot be used to keep the libraries open more hours. It appears from comments in the press and on the internet that there would be no shortage of people willing to volunteer their time and efforts to keep the library doors open.

F9: It is library policy that a volunteer cannot check out books to patrons. Government Code Section 6267 is cited as the basis for this policy. However, this code does not explicitly exclude volunteers from checking out books for patrons, nor is there case law which would prohibit their doing so. Code Section 6267 reads: “All registration and circulation records of any library which is in whole or in part supported by public funds shall remain confidential and shall not be disclosed to any person, local agency, or state agency except as follows: (a) By a person acting within the scope of his or her duties within the administration of the library. (b) By a person authorized, in writing, by the individual to whom the records pertain, to inspect the records. (c) By order of the appropriate superior court. Response: Santa Cruz City/County Public Libraries – PARTIALLY AGREE The confidentiality of library patrons is legally protected by the State of California. Staff undergoes background and fingerprint checks before being hired. This is an issue of public Saving the Branches May Kill the Tree ∫ 151 trust and allowing volunteers to access information considered confidential by our patrons and protected thereby by law is an area of great concern. Checking out materials is considered a core and basic service. Libraries, in general, do not entrust this type of service to volunteers. Signing a confidentially agreement is a weak form of protection since there are no sanctions to be taken against a volunteer who violates patron confidentiality. Paid employees risk their livelihood and references to secure another job; volunteers can only be asked to not volunteer anymore.

F10: The SCPL does not have a volunteer organization under the library administration. Instead, volunteers are part of the Friends group, which has a paid member who works 20 hours a week interviewing prospective volunteers and matching them with appropriate library tasks. Volunteers do fill out applications and sign confidentiality agreements. Response: Santa Cruz City/County Public Libraries – PARTIALLY DISAGREE Not all volunteers sign confidentiality agreements.

F11: With the current procedures for recruitment and training, volunteers suffer a bad reputation with library personnel. Some staff consider volunteers to be unreliable, prone to mistakes, or lax in fulfilling their obligations. Nevertheless, library administration states that the more than 14,000 hours of work accomplished by volunteers this past year were greatly appreciated. Response: Santa Cruz City/County Public Libraries – PARTIALLY DISAGREE This is too strongly stated. Volunteers do not have a bad reputation with staff. Staff is too taxed to take on any additional responsibility that using volunteers more than they already do would require. There is also very little support available for when a volunteer isn’t working out.

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R5: The SCPL should make a serious investment in volunteer development. Dedicate library staff to recruit, interview, select, assign, and train volunteers. Assign volunteers consistent responsibilities. Use volunteers to greatly expand library hours, and use more volunteers to provide many of the outreach services currently handled by employees. Response: Joint Powers Authority Board – REQUIRES FURTHER ANALYSIS Staff supervision of volunteers increases as the library utilizes more volunteers. The costs need to be considered along with the benefits. Currently we do not have funds allocated for a full time volunteer coordinator. Please refer to the full volunteer report. Response: Santa Cruz City/County Public Libraries – REQUIRES FURTHER ANALYSIS This would take staffing that we currently cannot afford. Please refer again to the full volunteer report. Once again, the task force is likely to address this.

F12: It is library policy that volunteers can only assist staff; they cannot replace staff. A volunteer can perform one task but not all tasks that constitute a job description. This reflects the library system’s agreement with the unions. Response: Santa Cruz City/County Public Libraries –AGREE This is also library and city policy on the role of volunteers. It is a past practice with the unions more than a formal agreement.

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R6: The JPB and the SCPL should then develop staffing plans for the libraries, reconsidering the policy that at least two employees are needed at every open library, and including the expanded use of volunteers. Consider what library branches might need to be closed and maximize the hours at those left open. One strategy proposed by library administration in March was the closing of some branches, leaving the book and materials collections and the computers and turning the facilities over to their communities for use as reading rooms/learning centers. In some communities the recreation district might be able to manage these centers. Saving the Branches May Kill the Tree ∫ 163 Candidates for conversion would be the branches in: • Felton, open 8 hours/week, 3.5 miles from the Scotts Valley branch • Garfield Park, open 12 hours/week, 1.7 miles from the Central library • Branciforte, open 14 hours/week, 1.5 miles from the Central library • Capitola, open 14 hours/week, 2.3 miles from the Live Oak branch The La Selva Beach library would be a prime candidate for conversion to a reading room. It is open 8 hours/week and is 5.2 miles from the Aptos library. However, considering the project underway to operate with one library employee, one self checkout machine, and a volunteer, the SCPL could offer a choice to that community: to implement that project (if the union approves the plan) or for the La Selva Beach community to take over the library and operate it with volunteers as a reading room. On the other hand, the Boulder Creek library is an ideal branch for implementing the “one staff member plus volunteers and a self checkout machine” concept. It serves unincorporated northern Santa Cruz County, serves a larger population than the La Selva Beach branch, and is 10.2 miles from the Scotts Valley library. For a prototype of a local, all-volunteer library, communities could look at the Porter Memorial Library in Soquel. One big advantage of this possibility for the local communities is that they can maximize the number of open hours, on a schedule that is most convenient for them. This recommendation is proposed as an intermediate-term strategy to allow the SCPL system to focus and develop the financial foundation necessary to create long-term sustainability for a system that can be expanded again as future revenues increase. Response: Joint Powers Authority Board – REQUIRES FURTHER ANALYSIS The LJPB has established a Task Force made up of one representative from each of the 10 branches, 4 JPA board members, the library director, 3 staff members and a facilitator. The Task Force will begin work in August 2010 to identify service models that are financially sustainable and aligned with the five year projections. Response: Santa Cruz City/County Public Libraries – REQUIRES FURTHER ANALYSIS The Library Board established a task force to consider alternatives such as those recommended here. The issue of square footage of available library space must be factored in and one cannot just look at the distance between facilities in our unique configuration.

F13: Volunteers need to be trained and they need to be supervised; these needs require staff time and attention, and consequently there are costs associated with the use of volunteers. Response: Santa Cruz City/County Public Libraries –AGREE

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F14: The Friends recently expanded the list of current volunteer needs posted on its web site. It does not include checking out books, however, which limits the possibility of using volunteers to keep the libraries open more hours. Response: Santa Cruz City/County Public Libraries – PARTIALLY DISAGREE Thinking that using volunteers to check out is the only way they can help libraries stay open more hours is way too narrow. There are many functions that volunteers can help 152 ∫ Santa Cruz County Grand Jury Final Report 2009-2010 with that might eventually result in being able to be open more hours. We need staff devoted to volunteer coordination as stated in Finding 13 to explore this. Until that happens, even if we were to use volunteers to check out books, we would not be able to do so without staff to manage the volunteer function. Library Services and the Strategic Plan In December 2008, the past library director retired after 25 years of service. There was an interim director for a brief time while the JPB and the City of Santa Cruz recruited and hired a new director, who joined the SCPL system in July 2009. Under new leadership, the SCPL undertook an ambitious series of town hall meetings and focus group sessions with the goal of developing a community-based plan for the next five years. The town hall meetings were centered on the library branches. The focus groups were of assorted demographics (seniors, Latinos, business leaders, teens, educators, the homeless, a lady’s club, et cetera). The data collected through these activities was supplemented with information from about 2,500 surveys gathered over the internet and in person at grocery stores and farmers markets in the county. The result is the 3-5 Year Strategic Plan, 2010-2015, presented to the JPB and the public on Monday, April 19, 2010. The strategic plan that was developed is not intended to solve current budget problems but rather to provide the system with a focused future.

F15: What was discovered through the planning process was not a surprise: library patrons use their local libraries, but they also enjoy visiting other libraries in the system. This is supported by the data in the chart that follows on illustrating where people from each community check out their library materials. These percentages are based on numbers from the 2007/08 fiscal year, before the serious reduction in open hours. The first, second, and third most frequently used libraries (in terms of circulation) for each residential area are color-coded. You can see that patrons from all communities in the county check out books from the Central library, with the Aptos and Scotts Valley branches being second and third most popular. Response: Santa Cruz City/County Public Libraries –AGREE

F16: There was considerable consistency in library service priorities, with reading, viewing, and listening for pleasure; lifelong learning; creating young readers; and connecting with the online world being generally the highest ranked. One notable contrast was the attitude of some among the more mature population who favor local branches and believe libraries must be about books and personal service, while others among the younger population suggest that there will be fewer branches in the future and libraries will be less about books and more about technology. Everyone, regardless of age, wants the libraries open many more hours and on regular schedules. Response: Santa Cruz City/County Public Libraries –AGREE Saving the Branches May Kill the Tree ∫ 153 8002-7002 hcnarB hcaE ta noitacoL emoH reworroB yb stuO kcehC fo egatnecreP 51F hcnarB yrarbiL avleS aL dleifraG redluoB aO eviL notleF lartneC alotipaC etroficnarB sotpA hcaeB kraP keerC %4 %2 %0 %0 %21 %5 %2 %1 %37 sotpA %3 %2 %0 %0 %73 %8 %1 %2 %74 samorA %3 %0 %0 %12 %02 %1 %2 %9 %2 dnomoL neB %1 %0 %0 %3 %41 %0 %1 %86 %1 keerC redluoB %2 %0 %1 %8 %52 %1 %1 %73 %01 eladkoorB %31 %1 %1 %0 %61 %15 %2 %0 %41 alotipaC %3 %1 %0 %0 %21 %6 %2 %0 %57 sotilarroC %1 %0 %7 %1 %38 %1 %3 %0 %2 tropnevaD %2 %0 %0 %63 %42 %1 %2 %2 %1 notleF %1 %1 %51 %1 %04 %2 %2 %0 %73 modeerF %1 %74 %0 %0 %11 %2 %4 %0 %33 hcaeB avleS aL %35 %0 %0 %0 %32 %11 %7 %0 %3 kaO eviL %1 %0 %0 %71 %21 %1 %4 %1 %2 nomreH .tM %2 %3 %0 %0 %8 %3 %1 %0 %28 raM leD oiR %4 %0 %01 %1 %36 %2 %61 %0 %2 ytiC zurC atnaS %7 %0 %3 %1 %04 %11 %81 %0 %4 tuO zurC atnaS %1 %0 %0 %1 %21 %1 %1 %0 %1 yellaV sttocS %1 %0 %0 %0 %5 %3 %1 %0 %88 ffilcaeS %9 %1 %1 %0 %02 %93 %3 %0 %62 leuqoS %3 %0 %1 %2 %63 %6 %6 %0 %4 procninU ytnuoC CS %4 %9 %1 %0 %72 %7 %4 %0 %54 ytiC ellivnostaW %7 %9 %0 %1 %54 %8 %31 %0 %41 tuO ellivnostaW %4 %1 %4 %6 %25 %5 %3 %1 %11 aerA fo tuO noitacoL emoH sttocS k yellaV %1 %0 %14 %21 %61 %2 %2 %2 %13 %0 %1 %1 %16 %1 %2 %61 %28 %1 %1 %24 %2 %4 %41 %31 %01 %1 %4 %3 %43 %8 %8 %4 %51 slatoT noitacol emoh rep stuokcehc fo rebmun tsetaerG noitacol emoh rep stuokcehc fo rebmun ni dnoceS noitacol emoh rep stuokcehc fo rebmun ni drihT morf elpoep erehw setartsulli trahc sihT .metsys eht ni seirarbil rehto gnitisiv yojne osla yeht tub ,seirarbil lacol rieht esu snortap yrarbiL smeti rehto dna skoob rieht fo tnecrep 37 tuo kcehc sotpA ni gnivil elpoep ,ecnatsni roF .slairetam rieht tuo kcehc ytinummoc hcae no desab era segatnecrep esehT .yrarbil alotipaC eht morf tnecrep 5 dna yrarbil lartneC eht morf tnecrep 21 ,yrarbil sotpA eht morf .sruoh yrarbil ni snoitcuder suoires eht erofeb ,raey lacsif 8002/7002 eht morf srebmun 154 ∫ Santa Cruz County Grand Jury Final Report 2009-2010

F17: One important part of the Strategic Plan is the section entitled “Change for the Future,” a description of five current trends in public library services that the SCPL has identified and committed to in the coming years as it pursues its vision of Transforming lives and supporting communities. Succinctly, the five trends are: 1. Patrons get service at the level they want – more self-service in checking out materials, placing and picking up holds, editing own accounts, paying fines; and single point of service, 2. Rebranding and marketing – establishing the library as a relevant resource through evolving services and better marketing of those services, 3. Local focus – providing local content that is unavailable elsewhere and taking library services outside into the community, 4. Remote delivery of services – associated with self-service; downloadable materials, e- books, podcasts; online payment of fees, and 5. User involvement – use of social media like Twitter, Facebook, and Wikis. Response: Joint Powers Authority Board – AGREE Response: Santa Cruz City/County Public Libraries –AGREE

F18: Despite the budget problems, the SCPL offers an amazing range of outreach programs and in-house events. Through the efforts of library employees and Friends volunteers, there are programs for special populations like toddlers and young readers, students of all levels, teens, film and gaming enthusiasts, the elderly, the sight impaired, and the developmentally disabled. There are special holiday events, including pumpkin carving and gingerbread workshops. Programs and Partnerships was begun in September 2009, involving local businesses in library activities. It includes the “Book Wish List” being supported by local bookstores. Other businesses have held fundraisers, and still others have partnered with the library in offering parents and children in-store workshops and story-times. Response: Santa Cruz City/County Public Libraries –AGREE However, the Programs and Partnerships Division was established for more than just involving local businesses. It was established to bring under one roof all library programming and various partnerships with all sectors of the community. The Budget Funding for the libraries comes from five sources: • county property taxes and Santa Cruz and Watsonville city general funds • the ¼ cent sales tax approved by voters first in 1996 and then again in 2008 • library fees and fines • a State of California Public Library Fund grant • income from bequests and trusts The sales tax and monies from the city general funds are allocated to the SCPL and the Watsonville Library each year by a Library Financing Authority; the funds are divided using a population-based formula. The city of Santa Cruz provides administrative, financial, human resources, and legal services to the SCPL; they charge the library system a flat 5.5% of its total revenues for these services. Saving the Branches May Kill the Tree ∫ 155

F19: In March 2009, after two years of generous sales tax revenues, the SCPL had no cash reserves. In April 2009, the JPB set guidelines for the FY 2009/10 budget that included establishing and maintaining ongoing cash reserves of at least 5% of its annual budget and dedicating at least 8% of its operating budget to books and media. These goals were not met in the FY 2009/10 budget, and they are not being met in the budget proposed for FY 2010/11. Response: City of Santa Cruz Director of Finance – AGREE Response: Joint Powers Authority Board – AGREE Sales taxes were projected to increase FY08/09 from FY07/08 by $27,000. In reality, they declined by $344,000. The 8% for materials was established in the Facilities Master Plan adopted in 2008 not in FY 2009/10 as stated above. Response: Santa Cruz City/County Public Libraries –AGREE Sales taxes were projected to[sic] in FY08/09 from FY07/08 by $27,000. In reality, they declined by $344,000. The 8% for materials was established in the Facilities Master Plan adopted in 2008.

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R2: The Joint Powers Authority Board and the SCPL should determine and commit to a reasonable cash reserve that will enable it to manage its cash flow and pay bills and cover payroll expenses without relying on loans from the City of Santa Cruz. Response: Joint Powers Authority Board – HAS NOT BEEN IMPLEMENTED BUT WILL BE IMPLEMENTED IN THE FUTURE The JPB plans to implement a cash reserve policy in the budget for FY 2011/12. Response: Santa Cruz City/County Public Libraries – HAS NOT BEEN IMPLEMENTED BUT WILL BE IMPLEMENTED IN THE FUTURE This is being taken into account when defining financial sustainability and looking at alternatives by the task force established by the JPB. The JPB plans to implement a cash reserve policy in the budget for FY2011/12.

R9: The JPB should add another two voting members: (1) a financial or accounting advisor so that the library system has an expert planner and advocate for financial sustainability, and (2) a library professional, from another nearby library system or from The School of Library & Information Science at San Jose State University. Response: Joint Powers Authority Board – WILL NOT BE IMPLEMENTED This expertise is already present in the City Finance Director and the Library Director. Changes such as this would require opening up the JPA agreement which is not due to be opened until 2017 and an early opening is not recommended. Response: Santa Cruz City/County Public Libraries – WILL NOT BE IMPLEMENTED This expertise is already present in the City Finance Director and the Library Director. Changes such as this would require opening up the JPA agreement which is not due to be opened until 2017 and an early opening is not recommended.

F20: Over the last decade, prior and present library administrators have proposed or recommended closing from one to six branches to benefit the balance of the library system. However, in May 2009, the JPB directed library management to develop a balanced budget for FY 2009/10 that did not close any branches. They provided the same direction this April while facing even greater challenges to the system, essentially “kicking the can down the street a bit farther,” in the words of one board member. Response: Joint Powers Authority Board – PARTIALLY AGREE In April 2010 the JPB was presented with several options that all achieved the same goal- a balanced budget for 10/11. They selected the one that reduced hours at all the branches. Response: Santa Cruz City/County Public Libraries –PARTIALLY AGREE In April 2010 the JPB was presented with several options that all achieved the same goal- a balanced budget for 10/11. They selected the one that did not call for closing any facilities.

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R10: The requirements of the library system as a whole should take precedent over the needs of neighborhood branches, and the Joint Powers Authority Board members should consider the long term implications of their decisions. Response: Joint Powers Authority Board – HAS BEEN IMPLEMENTED The JPA Board members already take into consideration the long term implications of their decisions. The JPA Board does take into consideration the impact on the whole system in making decisions. There are negative consequences to closing neighborhood branches upon the system as a whole which the Board must also take into consideration.

F21: The SCPL may be able to balance the budget through deep cuts in personnel and services, but there is a cash-flow problem. The City of Santa Cruz loans the library the cash for payroll and other payables; it covers the actual cash deficit between the time expenses are paid and revenues are received. Currently this loan balance averages between $1 million and $1.4 million. The City charges interest at portfolio rates (in April 2010, about 1.4%), but beginning with the 2011/12 fiscal year the interest will rise to portfolio rates plus 2% (about 3.4% if the portfolio rate was still 1.4%); in the meantime the City will cap the loan at $1 million. The additional interest will add to the cost of operating the library system, and staff stated that, with a cap, some bills will not be paid in a timely manner and additional staff time and effort will be required to prioritize payments. 156 ∫ Santa Cruz County Grand Jury Final Report 2009-2010 Response: City of Santa Cruz Director of Finance – PARTIALLY AGREE The average loan balance has not averaged between $1 million and $1.4 million. The loan balance averaged approximately $500,000 in fiscal year 2009 and approximately $400,000 in fiscal year 2010. The loan balance has decreased over the last two fiscal years and there has been no need for a loan during the last 3 months of fiscal year 2010. Response: Joint Powers Authority Board – PARTIALLY DISAGREE The loan balance does not average between $1-1.4 million. These are maximum amounts reached on several days last year not on a regular basis. The Library has also factored into its 5 year projections re-establishing the reserve to handle the cash flow issue. Given the current situation (ending FY0910 in the black) we do not anticipate exceeding the limit. Response: Santa Cruz City/County Public Libraries –PARTIALLY DISAGREE The loan balance does not average between $1-1.4 million. These are maximum amounts reached on several days last year not on a regular basis. The Library has also factored into its 5 year projections re-establishing the reserve to handle the cash flow issue. The line about with a cap, some bills MAY not be paid in a timely manner rather than will. Given the current situation (ending FY0910 in the black) we do not anticipate this issue occurring.

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F22: The SCPL has three loans that it must repay, with interest, and substantive rent for headquarters: • First, there is the working capital loan mentioned above, the advance from the City of Santa Cruz to cover the cash requirements on a day-by-day basis. This loan will be outstanding until the SCPL develops the reserves to manage its cash flow. Response: Joint Powers Authority Board – PARTIALLY DISAGREE This is a cash flow loan that is repaid as soon as the monthly payment is received from the County. Response: Santa Cruz City/County Public Libraries –PARTIALLY DISAGREE This is a cash flow loan that is repaid as soon as the monthly payment is received from the County. • Second, there is a loan associated with a Santa Cruz County overpayment, a distribution error discovered in 2005. From August 2005 through August 2013, the SCPL must pay annual principal of $40,293 plus variable rate interest. Response: Joint Powers Authority Board – AGREE Response: Santa Cruz City/County Public Libraries – AGREE • Third, there is a loan from the city of Santa Cruz for improvements to the new headquarters building. Interest is 5%. In September 2008, the principal was $467,303; the current loan balance is about $430,150. The annual payment is $60,518, and this loan will be paid off in 2018. Saving the Branches May Kill the Tree ∫ 157 Response: Joint Powers Authority Board – AGREE Response: Santa Cruz City/County Public Libraries – AGREE • The City of Santa Cruz purchased the building at 117 Union Street in Santa Cruz for use as library headquarters, to house administrative and technical services and outreach. The facility is shared with the Water Department, and building expenses are allocated to each according to the square footage occupied. The library’s portion of the annual rent is $287,189, until 2037 when the City’s loan for the building purchase will be paid in full. Response: Joint Powers Authority Board – AGREE However, it is important to note that the Library was paying $21.89 per square foot for rent and utilities for its Headquarters building on Pacific Avenue and now pays $20.93 per square foot for a building that is being purchased not rented. Response: Santa Cruz City/County Public Libraries – AGREE However, it is important to note that the Library was paying $21.89 per square foot for rent and utilities for its Headquarters building on Pacific Avenue and now pays $20.93 per square foot for a building that is being purchased not rented. Complete Finding Response: City of Santa Cruz Director of Finance – PARTIALLY AGREE The amount of the annual payment to the City of Santa Cruz for use of the building at 117 Union Street is not $287,189; rather the amount varies each year between fiscal year 2010 and fiscal year 2037, from a low of $283,147 in fiscal year 2028 to a high of $312,516 in fiscal year 2035. After 2037, no payments are due under the existing lease.

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F23: While the library staff tabulates a wealth of data about the Santa Cruz community’s library use, (visits per capita, books and materials checked out per capita and per active member; busyness and circulation and visits per open hour, et cetera), there are no established cost accounting measures to gauge the cost of operating the individual branches or the cost of specific library services. The library director prepared a one-time memo detailing the monthly and annual costs for the bookmobile in March 2010 upon request from a member of the JPB. Response: City of Santa Cruz Director of Finance – AGREE Response: Joint Powers Authority Board – AGREE Response: Santa Cruz City/County Public Libraries – AGREE This statement is, however, very misleading. Establishing costs per individual branch is very complicated. Fixed costs are easy to calculate and have been. There are variable costs that are much harder to calculate. We would need to come up with a chargeback system for all administrative functions- payroll, computer support, courier service, branch supervision, programming support, acquisitions/cataloging and processing etc. This is further complicated since the smaller branches have been sharing staff with the larger branches so allocating staff time can get very fuzzy. There has really been no value in allocating costs this way since revenues are not branch specific. I am not sure what 158 ∫ Santa Cruz County Grand Jury Final Report 2009-2010 specific library services are being referred to in terms of cost. Once again, there has not been any value perceived in determining the cost of a service such as materials acquisition. It isn’t like we will stop doing it based on cost. We are always looking at ways to be more efficient but quantifying that in terms of service provided is not an appropriate model for this type of organization. The Library is not a business and cannot be run like one.

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R7: Just as the SCPL has partnered with local businesses to enrich its collection and offer outreach programs, it should consider business partnerships/corporate sponsorships of the bookmobile. Solicit businesses to buy a bookmobile or van or to cover the annual cost of a vehicle, and allow them to wrap it with their advertising. The cost of a vinyl wrap for the bookmobile is estimated to be about $4,000. 164 ∫ Santa Cruz County Grand Jury Final Report 2009-2010 Response: Joint Powers Authority Board – REQUIRES FURTHER ANALYSIS The recently adopted SCPL 2010-2015 Strategic Plan states under Community Connections that “The library will initiate and nurture partnerships with the public, private, and nonprofit sectors in Santa Cruz County for the mutual benefit of the partners, the Library, and the Community.” We currently have many partnerships that enrich our programs and will continue to seek mutually beneficial opportunities. Response: Santa Cruz City/County Public Libraries – REQUIRES FURTHER ANALYSIS We currently have many partnerships that do enrich our programs and are always looking for mutually beneficial opportunities. Businesses generously support our summer reading program by donating prizes for all ages. Borders has done a fund raiser for us as has Peet’s Coffee and Tea. Libraries need to be careful when it comes to advertising. We do not want to be viewed as partial to any one business as we serve the entire community. If a bookmobile were to have advertising on it for a company, it would still need to be recognizable as the bookmobile and not as a delivery vehicle for the company that is sponsoring it. It is not clear from this recommendation that the Grand Jury recognizes that we already do have a bookmobile. The current one does not need to be replaced for several more years.

R8: The SCPL system should re-evaluate the policy that all services must be free to everyone. Concentrate on the key priorities. Understand the costs of extra services and charge fees to cover those costs. In fact, the SCPL should adopt good cost accounting measures so that the costs of operations are clearly understood – the costs associated with each branch, with each library service and program, et cetera. Response: City of Santa Cruz Director of Finance – REQUIRES FURTHER ANALYSIS It may be useful for the Library to allocate its variable operating costs to each branch so that the Library could determine the most cost effective use of Library resources. To the extent allowed by law, it may be appropriate for the Library to determine if there are unexplored opportunities to implement new and/or higher fees. Response: Joint Powers Authority Board – REQUIRES FURTHER ANALYSIS We can look at value added services that perhaps we can charge for such as Interlibrary Loan or Books by Mail; however basic library service must remain free as per state law. The library task force will be studying these recommendations and will report back in January 2011. Response: Santa Cruz City/County Public Libraries – REQUIRES FURTHER ANALYSIS We can look at value added services that perhaps we can charge for- Interlibrary Loan or Books by Mail perhaps. Basic library service must remain free as per state law. The requested cost accounting is not necessarily the best way to proceed. Once again, we expect the task force to review this. Saving the Branches May Kill the Tree ∫ 165

F24: Currently there are no reserves for technology repairs or improvements or for replacing the several SCPL vehicles, including the bookmobile. There are no reserves to finance facility development. There are no emergency reserves. Response: City of Santa Cruz Director of Finance – AGREE Response: Joint Powers Authority Board – AGREE Response: Santa Cruz City/County Public Libraries – AGREE

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F25: In FY 2008/09, personnel costs accounted for 73.6% of the budget, while books and materials accounted for 6.3% and technology accounted for 0.8%. Personnel costs are projected to consume 80% of the budget within a few years. While employees have been furloughed about 10% of the time this year and the furloughs will continue into the next fiscal year, retirement programs through the California Public Employees’ Retirement System (CalPERS) have not been fully funded and health insurance rates are expected to rise significantly. Response: City of Santa Cruz Director of Finance – AGREE Response: Joint Powers Authority Board – PARTIALLY AGREE It isn’t really correct to say that CalPERS has not been fully funded. During the period of the furlough, city and employees have been paying in based on their reduced pay. When current employees retire, the calculation will be made on their non-furlough pay which is higher. There is a slight discrepancy which is why we have decided not to continue the furlough beyond 2 years. Response: Santa Cruz City/County Public Libraries – PARTIALLY AGREE It isn’t really correct to say that CalPERS has not been fully funded. During the period of the furlough, city and employees have been paying in based on their reduced pay. When current employees retire, the calculation will be made on their non-furlough pay which is higher. There is a slight discrepancy which is why we have decided not to continue the furlough beyond 2 years but this amount has been declared not significant enough to be concerned about at this time.

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R4: With R1, 2, and 3 as priorities, the JPB and the SCPL should develop a balanced budget, also keeping in mind that investments in the collection (books and materials) and additional investments in technology are important to a healthy library system. The Grand Jury believes that a substantial reduction in personnel, perhaps by as much as 20 percent, might be necessary to achieve an ideal budget. Response: Joint Powers Authority Board – REQUIRES FURTHER ANALYSIS The budget is currently balanced. The Library Board established a task force to consider financially sustainable alternatives. Response: Santa Cruz City/County Public Libraries – REQUIRES FURTHER ANALYSIS The budget is currently balanced. The Library Board established a task force to consider alternatives that are financially sustainable.

F26: Also in FY 2008/09, the population served per FTE was lower than the State mean (1,735 versus 3,094) and lower than comparable counties’ figures. Expenses per capita were significantly higher than the State mean ($61.90 versus $34.69) and comparable counties’ numbers. Library administration suggested this was “probably because of the relatively large number of branches we have for the population.” The abundance of branches and the reported library policy that at least two employees are required to staff any open library contribute to these outsized numbers. Saving the Branches May Kill the Tree ∫ 159 Population Served Per FTE Staff Total Operating Expenditure Per Capita 3500 $70.00 3000 $60.00 2500 $50.00 2000 $40.00 1500 $30.00 1000 $20.00 500 $10.00 0 $- California Santa Cruz San Luis Santa Barbara Monterey California Santa Cruz San Luis Santa Barbara Monterey Average County Obispo County Average County Obispo County County County Response: Joint Powers Authority Board – PARTIALLY DISAGREE There is insufficient information to verify whether the relatively low population to FTE and the expenses per capita is caused by the relatively large number of branches nor does it preclude that there may be other contributing factors. Without studying all the factors simply closing branches will not achieve the expected goals. The JPB task force will be studying this issue. Response: Santa Cruz City/County Public Libraries – PARTIALLY DISAGREE It was suggested that the number of branches is probably high given the small size of the county. Expenses per capita are also higher because Santa Cruz is an expensive place to live. Staff in Santa Cruz do not earn as much as their colleagues over the hill. Our problem is more that the total square footage in our branches is inadequate for the size of the population. A staffing level of two is considered minimum for personal security reasons. We have never stated that one of those two cannot be a volunteer as long as the workload and assigned tasks are appropriate to the staffing configuration. In general, there is a certain economy of scale that can be reached by having fewer but larger branches. The down side is that neighborhoods lose branches that help identify that neighborhood and serve as cohesion for it as well.

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F27: Santa Cruz County has more branches, or outlets, per square mile than the comparable counties of Monterey, San Luis Obispo, and Santa Barbara. With a total area of 436 square miles in the county, the service area per outlet averages about 40 square miles. Service Area per County Population Area in Square Miles Outlet in Square Miles Santa Cruz 209,332 436 40 San Luis Obispo 240,480 3,305 207 Santa Barbara 227,349 1,164 129 Monterey 230,478 3,125 156 160 ∫ Santa Cruz County Grand Jury Final Report 2009-2010 Response: Joint Powers Authority Board – PARTIALLY AGREE This comparison is questionable because it does not factor in the geographical differences among these counties. Also, it doesn’t reflect the library square footage per capita or the library square footage per square mile. Counties with large rural areas will have more square miles per branch. Response: Santa Cruz City/County Public Libraries – AGREE See comment in F26. Conclusions C1. The mission of the Santa Cruz Public Libraries is to provide materials and services which help community residents meet their personal, educational, cultural, and professional information needs. This is the current mission statement for the SCPL. Although library enthusiasts from around the county participated in the strategic planning process and considered what the library might look like in 2020, it’s very hard to know just where technology will take us – and our libraries – in the next ten years. In fact, it is difficult looking just a couple of years down the road. The library system will need a solid financial foundation to enable it to evolve as necessary to meet the needs of the community in this era of swiftly-changing technology. C2. There is not enough money in our current economic climate for everything the JPB and the SCPL needs to do today: • there are three loans to pay off and significant rent for the headquarters building • there are plans to build new libraries in Scotts Valley, Capitola, and Felton; in addition to building and equipment costs, there will be moving expenses and additional ongoing staff and utility expenditures because of the increased square footage • there is routine maintenance and emergency repairs for the ten branches and headquarters • there are major technology improvements that must be funded • there is equipment, including vehicles, that need to be maintained in the short term and that will need to be replaced in the near future • there must be funding to build the collection • there must be savings to build reserves • there are personnel costs that are increasing from year to year while revenues are decreasing C3. A dramatic shift in library priorities and operations is necessary to create a balanced budget while allocating the funds necessary to buy the technology that will allow the library staff to improve productivity and to create a library that will continue to meet the needs of the community as our future is increasingly shaped by technology. Unfortunately, the JPB has been unwilling year after year to make the decisions that are necessary to provide an adequate and stable financial foundation for the Santa Cruz library system. The board, with Saving the Branches May Kill the Tree ∫ 161 elected representatives of the cities and county constituting a majority, seems to lack the political will to make the tough decisions that might be unpopular with constituents. C4. Library administration and staff have failed to expand the use of volunteers to provide more regular open hours for patrons.

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Findings & Recommendations 13 findings

F1: The following are the California State marijuana laws: • 11357a: possess concentrated marijuana (hashish)- felony • 11357b: possess less than one ounce of marijuana- infraction • 11357c: possess more than one ounce of marijuana- misdemeanor • 11357d: possess marijuana specific circumstances- misdemeanor • 11357e: possess marijuana specific circumstances- misdemeanor • 11358: cultivation of marijuana- felony • 11359: possess marijuana for sale- felony • 11360a: transportation of marijuana over 28.5 grams- felony • 11360b: give/transport marijuana/hashish under one ounce- misdemeanor • 11361b: furnish, et cetera, minor with marijuana- felony

F2: The Santa Cruz County District Attorney uses the equivalent of one Assistant District Attorney (salary about $108,000/year plus benefits) to prosecute marijuana-related offenses. In 2007 the District Attorney filed 31 misdemeanor and 114 felony charges for marijuana offenses; in 2008 those numbers were 45 and 132.

F3: The Santa Cruz Narcotics Enforcement Team employs two detectives (salary about $101,000/each/year, plus benefits) and one sergeant (salary about $136,000/year including 14 ∫ Santa Cruz County Grand Jury Final Report 2009-2010 overtime, plus benefits). About 40 percent of the task force’s time is spent on marijuana offenses, for a total of $135,200 in salaries and benefits. Calculation: $101,000 * 2 = $202,000 + $136,000 = $338,000 * .40 = $135,200

F4: The table below shows the number of marijuana charges filed in the four incorporated cities in the County in 2007 and 2008. California Capitola Santa Cruz Scotts Valley Watsonville State Laws 2007 2008 2007 2008 2007 2008 2007 2008 11357a 3 4 17 31 1 7 3 3 11357b 53 28 302 545 40 32 105 233 11357c 7 5 7 13 3 3 3 4 11357d 1 5 1 11357e 22 37 5 14 13 11358 1 6 2 10 2 3 2 11359 1 2 34 48 1 2 10 10 11360a 8 17 1 1 11360b 9 13 1 1 3 11361b 1 5 Totals 65 45 403 724 47 52 139 269

F5: The approximate amount of officer time required in Capitola to process each marijuana-related case is as follows: • 11357a: 85 minutes • 11357b: 61 minutes • 11357c: 76 minutes • 11358, 11359, 11360: major cases lasting several hours to several days

F6: Using the amount of officer time required in F5 for Capitola and applying that figure to the charges filed in all four cities, we calculate that for the three offenses 11357a, 11357b, and 11357c, a total of 567 officer hours were spent in 2007 and 947 officer hours were spent in 2008 to process these marijuana related cases.

F7: 1,500 inmates in California State prisons are there for marijuana-only offenses, and the cost per inmate is roughly $50,000 per year. This puts the annual cost of incarceration of marijuana-only offenders in State prisons at $75 million. The number of marijuana-only related offenders in Santa Cruz County jails is unknown as the County computer system does not list marijuana-related offenses as a separate category.

F8: Approximately $200 million is spent annually in California to arrest, prosecute and incarcerate marijuana offenders. (This figure includes the $75 million from F7 above.) Allocating that cost to Santa Cruz County on a per capita basis would result in annual costs of $1.36 million. The Fiscal Impact of the Legalization of Cannabis ∫ 15 Calculation: CA population of approximately 38 million people Santa Cruz County population of 260 thousand people or 0.68 percent 0.68 percent of $200 million = $1.36 million in annual costs Revenue Findings

F9: The Santa Cruz Narcotics Enforcement Team seized approximately $150,000 in cash and property in 2008 and approximately $370,000 in cash and property in 2009. The Santa Cruz County Sheriff’s Department received a $30,000 grant in 2009 from the Federal Drug Enforcement Administration (DEA) under the Federal Domestic Cannabis Eradication and Suppression Program (DCESP) specifically to pay for overtime hours, training, and the purchase of equipment specific to marijuana-related crime enforcement.

F10: Santa Cruz County collects an unknown amount of revenue from marijuana-related fines; revenue is unknown because it is not tracked on a per offense basis. The fine for possession of less than one ounce of marijuana (11357b) is up to $270. However, since the County system doesn’t track fines per offense and since the fine amounts vary, the Grand Jury cannot estimate the current revenue for pot offenses.

F11: Based upon our assumptions about legalization and taxes, the State of California would collect approximately $400 million in additional sales tax revenue; the Counties would collect about $990 million in excise tax revenue. The State of California would collect additional income tax revenue from people working in the cultivation, production, and sales of marijuana.

F12: The County of Santa Cruz hypothetically would receive $129,200 in marijuana sales tax revenue from the state. This number was calculated with an assumption of 19 million ounces of annualized statewide consumption allocated on a per capita basis to Santa Cruz County with a minimum sale price of $100 per ounce. Calculation: CA population of approximately 38 million people Santa Cruz County population of 260 thousand people or 0.68% 0.68% of 19 million ounces = 129,200 ounces * $100/ounce 1% of sales tax revenue is returned to the County Sales tax to Santa Cruz County of $129,200

F13: The County of Santa Cruz hypothetically would receive $6.46 million in marijuana excise tax revenue if the County collected $50 per ounce. This number was calculated with an assumption of 19 million ounces of annualized statewide consumption allocated on a per capita basis to Santa Cruz County. Calculation: CA population of approximately 38 million people Santa Cruz County population of 260 thousand people or 0.68% 0.68% of 19 million ounces = 129,200 ounces $50 per ounce * 129,200 ounces = $6.46 million excise tax 16 ∫ Santa Cruz County Grand Jury Final Report 2009-2010 Conclusions C1. Although the federal government recently announced that it would no longer prosecute medical marijuana patients and providers whose actions are consistent with State laws, it has continued to enforce its laws on non-medical marijuana activities. To the extent that the federal government continued to enforce existing federal laws, it would inhibit the legal cultivation, sales, and use of marijuana in California even if the State legalized it for recreational purposes. C2. Santa Cruz County spends considerable resources, roughly $1.36 million based upon statewide estimates, enforcing existing marijuana laws through law enforcement, the courts, and jails. If marijuana were legal, it could result in savings to our local government by reducing the number of marijuana offenders incarcerated, reducing the associated time and costs for enforcement of marijuana-related offenses, and also the handling of related criminal cases in the court system. Costs associated with new marijuana regulations and the County’s collection of excise taxes are unknown. C3. Legalizing marijuana may result in the reduction of County revenues from fines for marijuana infractions, and it could reduce the cash and property seized by the Santa Cruz Narcotics Enforcement Team. It is unlikely that the county would receive another DCESP grant from the DEA. The County could impose additional fines and fees associated with a new law, but the net monetary effect is unknown. C4. The State of California would realize additional revenues from sales taxes generated by retail sales of legal marijuana. Some of those sales taxes, $129,200 based on the assumptions in this report, would come back to the County. The State also could realize additional income tax revenue from people involved in the business of marijuana cultivation, production, and sales. Santa Cruz County would derive some indirect benefit if the State were in better financial health as a result of marijuana legalization and taxation. Finally, Santa Cruz County would gain direct monetary benefit, $6.46 million based upon the assumptions in this report, from a $50 per ounce excise tax. The chart on the next page provides a summary of the Grand Jury’s calculations to provide a net estimated increase in revenue to Santa Cruz County of over $7.5 million if marijuana were legalized for recreational use. C5. It seems clear that, legal or not, millions of ounces of marijuana are going to be smoked each year in California. The Fiscal Impact of the Legalization of Cannabis ∫ 17 Changes in Revenues and Costs Associated With the Legalization of Marijuana Inc/(Dec) In Revenues (Inc)/Dec In Costs Revenues: Sales Tax: Price per ounce $ 100 Estimate # of ounces to be sold 19,000,000 Total Sales $1,900,000,000 Santa Cruz County population as a % of total CA population 0.68% Sales attributed to Santa Cruz County $ 12,920,000 Santa Cruz County portion of sales tax 1.00% Sales tax to Santa Cruz County $ 129,200 $ 129,200 Excise Tax: Estimated # of ounces to be sold 19,000,000 Santa Cruz County population as a % of total CA population 0.68% # of ounces attributable to Santa Cruz County 129,200 Estimated excise tax per ounce $ 50 Excise tax to Santa Cruz County $ 6,460,000 $ 6,460,000 Revenue lost: Loss of fines related to marijuana $ Unknown Loss of DCESP Grant $ (30,000) Estimated Cash and property seized based on 2008 actual – no longer available $ (370,000) Costs: Amount spent annually in CA to arrest, prosecute, and incarcerate marijuana offenders $ 200,000,000 Allocate to Santa Cruz County based on CA population 0.68% Estimated cost savings to Santa Cruz County $ 1,360,000 $ 1,360,000 Additional possible costs related to legalized marijuana: Licensing and collection of taxes, etc $ Unknown Others $ Unknown ____________ Net Estimated Increase in Revenue to Santa Cruz County $ 7,549,200 18 ∫ Santa Cruz County Grand Jury Final Report 2009-2010

April 26, 2011 — The Jail Inspection Reports

70 pages 19 findings 20 recommendations

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Findings & Recommendations 19 findings

F1: At the time of this inspection, there were five unfilled correctional officer positions due to budget constraints.

Related Recommendations (1)

R1: The Santa Cruz County Sheriff's Office and the Santa Cruz County Board of Supervisors should develop a plan to remedy the shortage of correctional officers in the Main Jail so that the plan can be implemented as funds become available.

F2: The mental health of inmates is handled by medications, the social model, counseling, and behavior modification. Mental health services are limited due to a shortage of trained mental health professionals to serve the needs of so many inmates.

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R2: The Grand Jury recommends that the Sheriff's Office and the Board of Supervisors seek additional funds to increase mental health services for inmates.

F3: On the two occasions that the Grand Jury toured the Main Jail, it found boxes of supplies stored in the hallways. The boxes blocked the visibility of the fire alarm. Conclusions: C1. The shortage of correctional officers hinders the individual care and progress of inmates and overburdens the workload of the current correctional officers. C2. Reduction of recidivism is possible if there are alternatives for mental health inmates such as appropriate medications and behavioral programs. C3. The Main Jail does not have adequate storage for supplies. Supplies are stored in areas that create a hazard to staff and inmates. SANTA CRUZ COUNTY MAIN JAIL 80 ∫ Santa Cruz County Grand Jury Final Report 2009-2010

Related Recommendations (1)

R3: The Sheriff's Office and the Board of Supervisors should solve the storage problem at the Main Jail by finding an appropriate place to house supplies or by purchasing additional storage space. Commendations: 1. The Grand Jury commends the staff at the Main Jail for creating a culture in which strict behavioral guidelines are balanced with dignity and respect. 2. The Grand Jury commends the staff at the Main Jail for their positive attitude despite continually having to do more with less. 3. The Grand Jury also commends the staff at the Main Jail for grouping inmates by degree of sociability and safety potential rather than by ethnicity. 4. The Grand Jury commends the mental health staff for their exceptional dedication to the treatment of inmates with mental health issues.

F4: While the officers had been on weekly rotations to monitor and maintain order at the facility, currently the Sheriff's Office has ended the rotation and a permanent officer has been assigned to the site.

Related Recommendations (1)

R4: The Santa Cruz County Sheriff's Office should continue the strategy of having a permanent officer on site.

F5: Inmates at Blaine Street attend classes at the Main Jail. However, the classroom space there is divided by an accordion partition and the classrooms often are noisy. Additionally, the classes for women are limited to basic education and life skills. Conclusions: C4. The presence of a permanent officer onsite is a significant improvement, especially in the areas of employee-inmate relations and inmate accountability. There is more stability and consistency because inmates are clearer on expectations. C5. Improving the classroom space and the curriculum for women inmates would provide a better learning environment and perhaps enable the women to learn skills that would be useful to them when they are no longer incarcerated.

Related Recommendations (1)

R5: The Sheriff's Office and the Santa Cruz County Board of Supervisors should allocate funds to create a classroom and expand the curriculum to include more general education classes and job-training skills. BLAINE STREET WOMEN’S FACILITY The Jail Inspection Reports ∫ 89 Commendations: 5. The Grand Jury commends the staff at the Blaine Street Women's Facility for its professional and competent manner of running the facility. 6. The Grand Jury commends the staff for maintaining a clean and orderly computer room. 7. The Grand Jury commends the staff for accessing the Gemma program.

F6: In January 2010, in a cost saving measure, minimum security inmates were moved into the medium risk facility for housing. The minimum risk facility (commonly referred to as “The Farm”) remains open to minimum security inmates for day activities such as GED classes and auto body classes.

Related Recommendations (1)

R6: The Santa Cruz County Sheriff’s Office should assign medical personnel to Rountree to administer medications. This would allow inmates who are housed at the Main Jail because they need medication, but who otherwise would qualify for Rountree, to be transferred to that facility, which perhaps would be a better setting for them and also ease overcrowding at the Main Jail. Commendations: 8. The Grand Jury commends the Rountree staff and correctional officers for the smooth transition during the combination of the minimum and medium detention facilities. The general well-being and safety of the inmates, staff, and correctional officers remained a priority and daily operations were not disrupted.

F7: Medical services are not available at the Rountree facility. Emergency medical cases are transported to local Doctors on Duty or Watsonville Community Hospital. Mental health professionals are available on an on-call basis. Inmates requiring mental health prescription medication cannot be housed at Rountree due to lack of medical personnel. Conclusions: C6. The conjoining of the two facilities was conducted in an efficient manner causing minimal disruption and optimal results. C7. Lack of medical and mental health treatment at the Rountree facility limits the type of inmate who can be housed at the facility and contributes to the overcrowding of the Main Jail ROUNTREE MINIMUM/MEDIUM CORRECTIONAL FACILITY 98 ∫ Santa Cruz County Grand Jury Final Report 2009-2010

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R7: The Santa Cruz County Sheriff's Office and the Santa Cruz County Board of Supervisors should develop a plan to update the Santa Cruz Holding Facility and to fully utilize the Watsonville Holding Facility and the Watsonville courthouse to alleviate the overcrowding of certain individual cells in the Santa Cruz Holding Facility. SANTA CRUZ COURT HOLDING FACILITY The Jail Inspection Reports ∫ 107 Commendations: 9. The Grand Jury commends the correctional officers and staff for maintaining a well- controlled environment within Court Holding, particularly given the need to update the facility.

F8: The Santa Cruz Holding Facility is very old and has only five cells available to separate inmates by classification. The general population cell houses as many as 20 inmates at a time. Rival gangs are separated, with one cell devoted to Sureños members and one cell to Norteños members. Females are placed in one cell, and juveniles, mental health inmates, and special circumstances inmates reside in the fifth cell. The approximate number of custodials per day is 50. Conclusions: C8. With a high volume of inmates and only five holding cells, it is a challenge to adequately separate inmates who pose a danger to one another and therefore to staff. Given the configuration of the holding cells, juveniles (particularly those who are affiliated with a gang) are at risk for being influenced by adult gang members.

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R8: The Probation Department and the Board of Supervisors should provide funds to complete the door alteration project to increase safety as well as increase the amount of space for the detainee.

F9: The Watsonville Holding Facility is a new facility that is state of the art and referred to by many correctional officers as “the jewel of Santa Cruz County.” The Watsonville Holding Facility has six holding cells for the following classifications: general population, females, juveniles, special needs such as inmates needing wheel chair access, and rival gangs. The Sureños and Norteños are kept in separate holding cells. The average number of custodials per day is 18 with a maximum capacity of 48. Conclusions: C9. The Watsonville Holding Facility incorporates several innovative and specific methods for assuring the safety of inmates and officers including a secure sally port area for the transfer of detainees, extensive video surveillance, a state of the art secure control room and well thought out classification of cell populations.

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R9: The Probation Department and the Board of Supervisors should allocate funds to secure the backfield and install security cameras. SANTA CRUZ JUVENILE HALL The Jail Inspection Reports ∫ 115 Commendations: 11. The staff is to be commended for their persistance in obtaining funds from grants. 12. The staff is to be commended for their progressive attitude in incorporating state of the art and well-researched methodologies in juvenile offender rehabilitation. 13. The Grand Jury commends the kitchen staff for their continual efforts in enhancing nutritional offerings for detainees, including use of organic products as well as reducing fat content in the food served. 14. The staff is to be commended for their use of "high strictness, high warmth," which encourages a positive attitude among detainees and facilitates the quick re-entry into their home environment.

F10: Due to the lack of funds, the project to convert inward-opening doors to outward- opening doors in detainee cells was terminated halfway through the project. Currently half of the doors on detainee rooms open inward, which limits space in an already small area. In addition, detainees can barricade the doors from the inside, causing unsafe conditions for staff and the detainee.

Related Recommendations (1)

R10: The California Department of Corrections and Rehabilitation should install surveillance cameras at access points in the rear of the Camp 45 property to increase the safety and protection of staff and inmates.

F11: Due to the lack of funds, the existing recreational space at the juvenile facility is limited to a small, cracked and uneven concrete quad area for all recreational activities. The backfield area is not fenced and does not have security cameras. Conclusions: C10. The doors that swing inward into the cells create a safety hazard for both detainee and staff. C11. Additional recreational space could be provided if the rear of the facility was fenced and security cameras were added. There would be access to a lawn area that would provide a more outdoorsy feel instead of the concrete recreational space that currently exits.

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R11: The California Department of Corrections and Rehabilitation and Camp 45 should establish partnerships with local colleges and/or universities to offer onsite GED and college CAMP 45 – INMATE FIRE CAMP 126 ∫ Santa Cruz County Grand Jury Final Report 2009-2010 extension programs to provide a more convenient educational experience. Commendations: 15. The Grand Jury commends Camp 45 and CAL FIRE for the excellent working relationship and communication they have established at the camp. 16. The Grand Jury commends the management and staff of Camp 45 for creating a caring and supportive environment that contributes to the success of the rehabilitation process. 17. The Grand Jury commends Camp 45 for the utilization of inmates in creating delicious meals and baked goods as well as a very well-run kitchen. 18. The Grand Jury commends Camp 45 for creating a welcoming atmosphere with outside grounds that include tables and barbecues. Visitors are able to enjoy the beautiful surroundings while providing inmates a chance for contact with family and friends.

F12: The 2007-2008 Grand Jury report recommended that Camp 45 install surveillance cameras at access points in the rear of the property. Upon inspection of the facility and through communication with management, the 2009-2010 Grand Jury learned that the cameras have not been installed.

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R12: The staff is to be commended for their progressive attitude in incorporating state of the art and well-researched methodologies in juvenile offender rehabilitation.

F13: GED and college extension programs for inmates sometimes are provided by Feather River College in Lassen County. Currently only GED classes are offered. No teachers are available to the inmates onsite; students must communicate with teachers through phone conversations. Assignments are completed and sent to Feather River College via a bus that travels to Susanville once a week. Conclusions: C12. Surveillance cameras would provide additional safety to the camp and potentially deter inmates from trying to escape. C13. The distance from the camp to the college limits the number of course offerings. In addition, the quality of education is not optimum with communication mostly via phone.

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R13: The Grand Jury commends the kitchen staff for their continual efforts in enhancing nutritional offerings for detainees, including use of organic products as well as reducing fat content in the food served.

F14: The staff is to be commended for their use of "high strictness, high warmth," which encourages a positive attitude among detainees and facilitates the quick re-entry into their home environment.

Related Recommendations (1)

R14: The staff is to be commended for their use of "high strictness, high warmth," which encourages a positive attitude among detainees and facilitates the quick re-entry into their home environment.

F15: The Grand Jury commends Camp 45 and CAL FIRE for the excellent working relationship and communication they have established at the camp.

Related Recommendations (1)

R15: SANTA CRUZ JUVENILE HALL 124 ∫ Santa Cruz County Grand Jury Final Report 2009-2010 ACCESS TO MEDICAL AND MENTAL HEALTH SERVICES Available 6 hours a day for medical and 8 hours a day for mental health services, 7 days a week. SANTA CRUZ JUVENILE HALL The Jail Inspection Reports ∫ 125 , 2009 CAMP 45 – INMATE FIRE CAMP January 28, 2010 Address: Rated Capacity: 100 + 10% overflow 13575 Empire Grade Occupancy: 97 Santa Cruz, CA

F16: The Grand Jury commends the management and staff of Camp 45 for creating a caring and supportive environment that contributes to the success of the rehabilitation process.

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R16: The Grand Jury commends the management and staff of Camp 45 for creating a caring and supportive environment that contributes to the success of the rehabilitation process.

F17: The Grand Jury commends Camp 45 for the utilization of inmates in creating delicious meals and baked goods as well as a very well-run kitchen.

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R17: The Grand Jury commends Camp 45 for the utilization of inmates in creating delicious meals and baked goods as well as a very well-run kitchen.

F18: The Grand Jury commends Camp 45 for creating a welcoming atmosphere with outside grounds that include tables and barbecues. Visitors are able to enjoy the beautiful surroundings while providing inmates a chance for contact with family and friends.

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R18: The Grand Jury commends Camp 45 for creating a welcoming atmosphere with outside grounds that include tables and barbecues. Visitors are able to enjoy the beautiful surroundings while providing inmates a chance for contact with family and friends.

F50: Conclusions: C8. With a high volume of inmates and only five holding cells, it is a challenge to adequately separate inmates who pose a danger to one another and therefore to staff. Given the configuration of the holding cells, juveniles (particularly those who are affiliated with a gang) are at risk for being influenced by adult gang members.

Related Recommendations (1)

R50: Conclusions: C8. With a high volume of inmates and only five holding cells, it is a challenge to adequately separate inmates who pose a danger to one another and therefore to staff. Given the configuration of the holding cells, juveniles (particularly those who are affiliated with a gang) are at risk for being influenced by adult gang members. Recommendations: R7. The Santa Cruz County Sheriff's Office and the Santa Cruz County Board of Supervisors should develop a plan to update the Santa Cruz Holding Facility and to fully utilize the Watsonville Holding Facility and the Watsonville courthouse to alleviate the overcrowding of certain individual cells in the Santa Cruz Holding Facility. SANTA CRUZ COURT HOLDING FACILITY The Jail Inspection Reports ∫ 107 Commendations:

Additional Recommendations 1

Not linked to specific findings.

R0: Atmosphere of classroom(s): Engaging and respectful. Are there adequate supplies (books, paper, computers, et cetera)? Yes. Are activities and coursework assigned by teachers? Students are given the same work as at any other high school. Are minors required to do homework? Yes. Number of minors not attending. Reason?

October 01, 2010 — Continuity…The Beginning of the Never-Ending Report Follow-up on the 2008-2009 Santa Cruz County

15 pages 2 findings 3 recommendations

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Findings & Recommendations 2 findings

F1: The implementation of Recommendation 5 to reinstate the School Resource Officer was delayed due to staffing and budgetary restrictions but no timeframe was provided for the reinstatement.

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Related Recommendations (1)

R1: SVUSD and SVPD should provide the Grand Jury with an update on the status of reinstating a School Resource Officer to the high school campus. Response: Scotts Valley Police Department – AGREE Has not yet been implemented but will be implemented in the future. The Scotts Valley Police Department remains committed to reinstating a School Resource Officer (SRO) at Scotts Valley High School as soon as staffing allows. Unfortunately, we have lost one officer to another organization and are still understaffed by two positions. Recruitment, academy and field training for one new officer can take a year to complete, thus delaying a return to full staffing. Once training is complete and we have returned to full staffing, which should take approximately 1 to 2 years, we will dedicate an officer to Scotts Valley High School. Response: Scotts Valley Unified School District At the time of the district’s initial response, the district had set aside funds for an SRO, but the Scotts Valley Police Department had no personnel to provide. This year, because of the state funding crisis, the district no longer has funding for an SRO, as all funds are needed to maintain basic core programs. If and when funds again become available, and if the SVPD is able to provide an SRO, the district intends to fund a partial SRO position at the high school.

F2: The responses to Recommendations 9 and 12 indicated the District would conduct further analyses of the suggestions in the recommendations but there were no explanations, no descriptions of the scope and parameters of the analyses or studies, and no timeframes. Continuity…The Beginning of the Never-Ending Report ∫ 193 2008-2009 Recommendation Respondent 2008-2009 Response 5 SVUSD should work with the Scotts SVUSD SVPD Has not been Valley Police Department (SVPD) to implemented but will be reinstate the School Resource Officer to implemented in the future the high school campus when budgetary restrictions allow. All staff members who teach or counsel SVUSD Requires further analysis students regarding alcohol prevention should be part of the planning team that addresses prevention and intervention solutions. The many resources provided through county agencies should be available for use by staff. SVUSD should involve students in self- SVUSD Requires further analysis help strategies such as peer counseling and conflict resolution, as well as county-wide programs such as Friday Night Live and the Together for Youth collaborative. Current Recommendations

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Related Recommendations (1)

R2: SVUSD should provide the Grand Jury with status reports on the analyses associated with Recommendations 9 and 12. 194 ∫ Santa Cruz County Grand Jury Final Report 2009-2010 Response: Scotts Valley Unified School District

📋September 01, 2010 — Forever Grssn, But Not Transparent: Why Does the Grand Jury Keep Investigating the Primary Public Defender Contract?

1 pages 2 findings 2 recommendations

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Findings & Recommendations 2 findings

F2: R3 Auditor-Controller October 1,2010 Santa Cruz County 90 Days

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F3: R1 Board of Supervisors September 1, 2010 Sources Documents/Publications 1991/92 Grand Jury Report: Public Defender’s Office 1994/95 Grand Jury Report: A Study of the Cost of Public Defender Services for Indigents 1998 Public Defender Transition Task Force Agendas and Memos 2006 Comparability Model 2008/09 Expenditure Actual Transactions Report for Professional and Special Services Budget Unit Financing Uses Detail – Public Defender FY 2008/09 Conflict attorney contracts Primary public defender contract (current) Primary public defender contractor’s quarterly reports to the CAO Santa Cruz County Budgets for FYs 2005/06 through 2009/10 Interviews Administrators and Personnel: County Administrative Office County Auditor-Controller’s Office County District Attorney’s Office Primary Public Defender Contractor Superior Court of California County of Santa Cruz Site Visits Superior Court of California County of Santa Cruz Web Sites http://www.buttecounty.net/Department%20Contacts.aspx http://www.co.marin.ca.us/ http://www.co.merced.ca.us/ http://www.co.santa-cruz.ca.us/ http://www.co.shasta.ca.us/html/CAO/budgets.htm http://www.cpda.org/ http://www.placer.ca.gov/Departments/Auditor/Budget.aspx http://www.slocounty.ca.gov/site4.aspx

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Additional Recommendations 2

Not linked to specific findings.

R1: 60 Days September 1, 2010

R3: 90 Days October 1,2010 Santa Cruz County Administrative Office

📋September 01, 2010 — Forever Gr n, But Not Transparent:

8 pages 6 findings 5 recommendations

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Findings & Recommendations 6 findings

F1: The current contract for public defender services is a fixed-price multi-year instrument. There is no visibility (transparency) into the breakdown of costs associated with this effort. The CAO negotiates extensions to this contract periodically without reference to the separate cost elements which make up the bottom line price. Response: Santa Cruz County Administrator Office and Board of Supervisors – PARTIALLY AGREE The current contract for public defender services is a fixed price multi-year instrument. The current contract is scheduled to expire as of June 30, 2015. The County Administrative Office has in the past negotiated extensions to this contract prior to and in accordance with expiration dates, and has negotiated reductions in the mid-term when the County’s fiscal constraints have required such renegotiation. The County has negotiated extensions to the contract in exchange for concessions from the amounts previously negotiated. Fixed price contracts are used throughout the County including in Public Works where large contracts do not include line item details on costs.

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F2: The primary Public Defender’s contract has never been audited by the County Auditor- Controller’s Office or any independent, outside auditor. This finding is similar to a finding of the 1991-1992 Grand Jury, which recommended that provisions for audit be included in all County contracts. The County’s response was, “The County’s policy regarding the inclusion of an audit provision within a contract is determined by the specific requirements of the contract. Certain contracts, particularly for professional services, including legal services, generally do not contain a provision for audit.” Response: Santa Cruz County Auditor-Controller – AGREE To our knowledge such an audit has not been performed.

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F3: The County, as directed by The Board of Supervisors, has not initiated a request for proposal for the primary public defender contract due in part to the following reasons: • belief that public competition for this contract would be costly and complex 26 ∫ Santa Cruz County Grand Jury Final Report 2009-2010 • assumption that there is no other local law firm of sufficient size that could manage the current work load • fact that the Board of Supervisors and judges are satisfied with the current law firm and therefore there is no reason to change contractors Response: Santa Cruz County Administrator Office and Board of Supervisors – PARTIALLY AGREE The County has identified the following reasons for not recently initiating a request for proposals for the primary public defender contract: ● the complexity and costs associated with transitioning the magnitude of the current public defender case load (between approximately 9,500 to 10,500 adult and juvenile appointments per year), ● the absence of another local firm with sufficient staffing resources and management experience to provide comparable services, ● the indications by the Board of Supervisors and the Superior Court that the current contractor meets the need of their clients and the needs of the Court. ● the determination that costs for the current primary public defender contract are competitive with the costs the County would pay for a Public Defender Office operated as a County department, staffed with public employees and, ● the importance that the current Public Defender plays in the local Criminal Justice System as an advocate for the defense of indigent clients and as an advocate for an efficiently run criminal justice system.

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F4: The County’s decision not to convert from a contracted public defender to a County department is based largely on the use of a comparability or replication model and the costs associated with conversion. This model was developed in-house by the CAO and is considered to be Confidential. Response: Santa Cruz County Administrator Office and Board of Supervisors – DISAGREE The County’s decision is based on all of the issues identified in the response to Finding 3 above.

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F5: In 1998, the County created a Public Defender Transition Task Force to consider future provisions for public defender services if the primary contractor were no longer available. The Task Force’s efforts included estimating the costs of contracting with other law firms and the costs of providing public defender services through an in-house department staffed by attorneys who would be County employees. Since this 1998 exercise and a 2006 update of the comparability model, there have been no recent evaluations of possible alternatives for providing public defender services. Response: Santa Cruz County Administrator Office and Board of Supervisors – PARTIALLY AGREE The County created a Public Defender Transition Task Force in light of the fact that as of July 1998 there would be three years remaining on the agreement with the Biggam law firm. The purpose of the Task Force, as articulated in a preliminary agenda for the meeting on June 19, 1998, was to continue the County’s long tradition of cooperation between the Forever Gr$$n, But Not Transparent ∫ 27 Board of Supervisors and the Court in the delivery of public defender services, and to develop a plan for Public Defender Services, to address what happens when the Biggam Law firm is no longer available to provide public defender services, including a determination of what the form of the next provider would be, i.e., a County Department or another contractor, and when the transition would begin and end. During the period from June 1998 through December 1998 the Task Force considered a number of issues, including: how public defender services are provided in other counties, the County’s legal authority for multi-year agreements, inter-county cost comparisons for Public Defender services and the distribution of cost and caseloads between the main firm and the conflicts firms, the history of collection of payments for public defender services assessed by the Courts, the cost per case for the District Attorney’s Office, and the estimated cost of the main public defender function if it were operated as a county department. Among other costs, the estimate included costs for a Public Defender, attorneys, administrative staff, investigators and support staff. While not recalculated each year, in the event that the County renegotiates the economic value of the contract mid-term, the various elements of the comparability model are tested.

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F6: All parties involved with the primary public defender, e.g., the Superior Courts, the County Board of Supervisors, County attorneys, and the CAO, are satisfied with the services provided by the contractor. Several persons interviewed by the Grand Jury volunteered favorable comments about the quality of the primary public defender’s services. No Response Required Conclusions C1. During the last 35 years, the same law firm has been contracted to be the primary public defender. Because there has been no competition for, or audit of, this contract during this time period, the citizens of Santa Cruz County only can assume that this is the best means of providing public defender services. The County needs to make public not just their reasoning but also their factual findings as to why the County continues to contract public defender services with the same firm. C2. There is more latitude with service contracts than just the bottom line. The County’s argument that the contract is too large for another local firm cannot be known without an RFP; another firm may be able to satisfy the terms of the contract. The County’s arguments that there are costs involved in the RFP process and that everyone appears to be satisfied with the current contractor seem to be true. However, with the RFP process the County might be able to award the contract to the current contractor at a lower cost to the County. C3. Without an analysis (audit) of the cost elements which determine the bottom line price of the public defender services contract, it is impossible to determine if the price is fair and reasonable for the effort being performed, especially since this contract is extended periodically without competition. The County’s response to a prior Grand Jury 28 ∫ Santa Cruz County Grand Jury Final Report 2009-2010

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Additional Recommendations 5

Not linked to specific findings.

R1: The Board of Supervisors should direct the County Administrative Office to restructure the current contract from a fixed-price type to a cost element type immediately or, at a minimum, during the next negotiation with the incumbent contractor. Response: Santa Cruz County Administrator Office and Board of Supervisors – WILL NOT BE IMPLEMENTED The County Administrative Office cannot restructure the current contract immediately because the term of the contract has not expired. The County will include discussion of different methods of cost structuring in future negotiations.

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R2: The County Administrative Office should add a ‘right to audit’ clause to the primary public defender’s contract. Response: Santa Cruz County Administrator Office and Board of Supervisors – HAS NOT BEEN IMPLEMENTED BUT MAY BE IMPLEMENTED IN THE FUTURE The County Administrative Office cannot unilaterally amend the existing contract. The office will discuss this recommendation with the contractor if renegotiations occur.

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R3: The County Auditor-Controller’s Office should conduct annual audits of the public defender contracts as part of the ongoing County Audit Program. Response: Santa Cruz County Auditor-Controller – WILL NOT BE IMPLEMENTED WITHIN NEXT 6 MONTHS The County performs various audits each year included some contract compliance audits. Due to staffing limitations and the wide range of audits to be performed, it is unusual that the same contract compliance audit would be performed annually unless the County is required to do so by either contract terms or legal requirements. The current primary Public Defender's contract does not presently have a clause that allows the Auditor-Controller to perform a contract compliance audit of it. Any request to perform an audit would need to be negotiated by the County Administrative office with the Public Defender firm. Under the current terms of the contract, it would be at the Public Defender's discretion to allow the audit and to control the scope of the audit. However, the Forever Gr$$n, But Not Transparent ∫ 29 contract does stipulate that the Public Defender "shall provide other reports to the Board of Supervisors as may be requested from time to time by the County Administrative Office." The Auditor-Controller will work with the County Administrative Office to request various reports supporting a variety of detailed information which will hopefully allow the County to analyze staffing and case loads. At the time the Public Defender's contract is next modified, we support the contract being brought in compliance with the current County Procedures. The Current County Policy and Procedures Manual, Section 300.A, which covers contracts and agreements, requires that contracts contain an audit provision allowing for audit and retention of records for a period of not less than 5 years or until audited whichever occurs first. The originating department is responsible for ensuring that these provisions are included in the agreement. We would at that time place the contract compliance audit on our annual audit plan.

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R4: The County Administrative Office, or other appropriate agencies, should announce publicly if and when the public defender contracts are being competed or extended by negotiation in a manner similar to other contract awards or announcements. In view of the extended period since this contract was put out for bid (1975), such an announcement would indicate that a formal public process is being used by the County to obtain these services. Response: Santa Cruz County Administrator Office and Board of Supervisors – HAS BEEN IMPLEMENTED Each year, the Board of Supervisors adopts the Public Defender Budget in a Public Hearing. The County Administrative Officer’s Recommended Budget and subsequent documents including the Supplemental Budget and Last Day Budget are made widely available to the public. For the past several years, existing contracts for the conflicts and main firms have only been re-opened by mutual consent solely to make reductions in the compensation schedules based on the County’s fiscal constraints. For each year that reductions have been agreed to by the contractors, the negotiations have included a one- year extension. These contracts are considered by the Board of Supervisors either in scheduled Public Hearings during budget considerations, or on publicly noticed Board of Supervisors’ Agendas.

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R5: The County Administrative Office should have the comparability model reviewed and updated by another agency or organization, such as the County Auditor-Controller’s Office or an independent auditor, to verify that the model provides a valid basis for the decision to continue to use a contracted public defender. Response: Santa Cruz County Administrator Office and Board of Supervisors – HAS NOT BEEN IMPLEMENTED BUT MAY BE IMPLEMENTED IN THE FUTURE Working with County Counsel to assure confidentiality, the County Administrative Office will review the comparability model with the Auditor-Controller for the purpose of verifying that the model provides a valid basis for the comparison of costs between a contracted public defender and providing these services as a County department.

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June 29, 2010 — County of Santa Cruz Grand Jury*

1 pages

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Does Appearance Trump Substance? Watsonville City Personnel Commission's Discipline Appeal Process

8 pages 7 findings 3 recommendations

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Findings & Recommendations 7 findings

F1: The City of Watsonville appeal process is outlined and governed by three documents: the City Charter, the Municipal Code, and the Rules and Procedures of the Personnel Commission. Response: Watsonville City Council – PARTIALLY AGREE In addition to the three documents, the appeal process is also governed by the Personnel Rules and Regulations of the City of Watsonville as adopted and amended through Resolution No. 44-07 (CM) of the Watsonville City Council and also by California Court decisions regarding due process. Government Code sections 3254(b) and 3254.5 were also taken into consideration as the employee involved is a firefighter.

F2: Per the Watsonville Municipal Code and the City Charter, recommendations made by the Personnel Commission are only advisory to the city manager No Response Required

F3: Prior to the hearing on August 20, the city did provide dinner for persons involved in the hearing. An agenda was posted announcing the dinner. The commissioners attended, as did the city attorney and the department manager defending the disciplinary action. In fact, the manager greeted and admitted one of the commissioners into the room where the dinner took place. Response: Watsonville City Manager – AGREE There was an agenda posted announcing the dinner for the commissioners. Staff was in attendance at the dinner which was open to any one wishing to attend.

F4: Those interviewed confirmed that the commissioner knew the department manager and that they did exchange salutations, but that nothing was said regarding the appeal. The hearing was not discussed during dinner. However, some of the commissioners also were concerned about the potential appearance of collusion. Response: Watsonville City Council – PARTIALLY AGREE Those in attendance confirm that nothing was said regarding the appeal\hearing at the dinner. However, it is not known whether or not some commissioners were concerned about the potential appearance of collusion as it was not expressed to staff, the City Attorney, or anyone else except apparently to the Grand Jury. Greeting and holding the door for someone is courteous and customary. For example, the attorney for the Department and the employee greeted each other in the hearing room. Does Appearance Trump Substance? ∫ 3 Response: Watsonville City Manager – PARTIALLY AGREE Those in attendance confirm that nothing was said regarding the appeal\hearing at the dinner. However, it is not known whether or not some commissioners were concerned about the potential appearance of collusion as it was not expressed to staff, the City Attorney, or anyone else except apparently to the Grand Jury. Greeting and holding the door for someone is courteous and customary. For example, the attorney for the Department and the employee greeted each other in the hearing room.

Related Recommendations (1)

R1: The Watsonville Personnel Commission should maintain a fair process free from suspicion of bias and to this end should limit the dinner attendees prior to the appeal hearings to commissioners, their legal counsel, and the recording secretary only. Response: Watsonville City Council – HAS BEEN IMPLEMENTED Dinners prior to future personnel hearings heard by the Personnel Commission will be limited to commissioners, the legal counsel to the commission and staff to the commission. Response: Watsonville City Manager – HAS BEEN IMPLEMENTED Dinners prior to future personnel hearings heard by the Personnel Commission will be limited to commissioners, the legal counsel to the commission and staff to the commission.

F5: The employee who requested the Commission hearing could have attended the dinner but would have been required to purchase his meal; however, he was not told he could attend. Response: Watsonville City Manager – PARTIALLY AGREE It is correct that the employee requesting the appeal hearing could have attended the dinner; however, he was not expressly invited. Nevertheless, it was posted on the agenda. This was a unique situation as usually Personnel Commission hearings to consider employee disciplinary appeals are closed to the public. However, in this case, the employee expressly requested that the hearing be open to the public. As a result, the dinner was made open as well to anyone wishing to attend. Staff present that evening were invited to eat after all commissioners had been served. Had the employee been present, he presumably could have eaten as well. Again, normally, this would have been a closed affair and only the Personnel Commission and staff to the commission (Recording Secretary and Counsel) would have been present.

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F6: The hearing was held after dinner. All parties were represented by counsel, including the commissioners, who were represented by the city attorney. When the hearing was completed, the commissioners went into closed session with the city attorney for deliberations. The city attorney provided clarification and advice when requested by the commissioners; the attorney only answered questions asked by the commissioners and did not influence their decision on the appeal. Response: Watsonville City Manager – AGREE

F7: The Watsonville city attorney advises and represents the city council and all city boards and commissions. The Santa Cruz city attorney and the Capitola city attorney similarly advise and represent the city councils and all boards and commissions in their cities. However, the Watsonville City Charter, unlike the charters of these other cities within the county, does not explicitly include commissions and committees for city attorney representation. Response: Watsonville City Council – PARTIALLY DISAGREE The Santa Cruz City Charter in Section 812 states that the City Attorney shall have the power and be required to (a) Represent and advise the City Council and all City officers, commissions or boards or departments in all matters pertaining to their office. The City of Capitola is a general law city and has no charter. Section 804 of the Watsonville City Charter states that the City Attorney shall, a. Represent and advise the Council and all City officers in all matters of law pertaining to their offices b. Represent and appear for the City in any or all actions and proceedings in which the City is concerned or is a party, and represent and appear for any City officer or employee or former City officer or employee in any or all actions and proceedings in which any such City officer or employee is concerned or is a party, for any action arising out of his employment or by reason of his official capacity; c. Attend all meetings of the Council and give his advice or opinion in writing whenever requested to do so by the Council or by any of the boards or officers of the City. The City was concerned in this matter. Response: Watsonville City Manager – PARTIALLY DISAGREE The Santa Cruz City Charter in Section 812 states that the City Attorney shall have the power and be required to (a) Represent and advise the City Council and all City officers, commissions or boards or departments in all matters pertaining to their office. The City of Capitola is a general law city and has no charter. Section 804 of the Watsonville City Charter states that the City Attorney shall, a. Represent and advise the Council and all City officers in all matters of law pertaining to their offices b. Represent and appear for the City in any or all actions and proceedings in which the City is concerned or is a party, and represent and appear for any City officer or employee or former City officer or employee in any or all actions and proceedings in which any such City officer or employee is concerned or is a party, for any action arising out of his employment or by reason of his official capacity; c. Attend all meetings of the Council and give his advice or opinion in writing whenever requested to do so by the Council or by any of the boards or officers of the City. The City was concerned in this matter. Conclusions C1. The Personnel Commission conducted the appeal in accordance with the requirements of the City Charter, the Municipal Code, and the Rules and Procedures of the Commission, and there were no errors in the manner in which the hearing was accomplished. C2. There is a need to ensure that all participants receive a fair and impartial hearing by an independent judge. Although the dinner was not an illegal action, the mingling of commissioners with management prior to the hearing could result in a perception of bias that may undermine the credibility of the Personnel Commission in the eyes of the participants and the general public. C3. The addition to the City Charter of specific language about the city attorney’s representation of city commissions and committees would help to clarify the role and eliminate speculation about the legitimate powers and duties of that attorney. Does Appearance Trump Substance? ∫ 5

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R2: To eliminate speculation about the role of the city attorney, the Watsonville City Charter should expand the description of the powers and duties of the attorney to include the representation of city commissions and committees. Response: Watsonville City Council – WILL NOT BE IMPLEMENTED The Watsonville City Charter already authorizes the City Attorney to advise the Commission.

R3: To provide the greatest separation between the Personnel Commission and city management, the city should consider hiring independent counsel for the Commission. Response: Watsonville City Council – WILL NOT BE IMPLEMENTED In a series of California published cases over the last few years, California courts have been very clear that it is perfectly proper for the City Attorney to represent the Commission. In Morongo Band of Mission Indians v. State Water Resources Control Board, 45 Cal.4th 731 (February 9, 2009), the California Supreme Court addressed this very issue. In construing the constitutional due process right to an impartial tribunal, we take a more practical and less pessimistic view of human nature in general and of state administrative agency adjudicators in particular. In the absence of financial or other personal interest, and when rules mandating an agency's internal separation of functions and prohibiting ex parte communications are observed, the presumption of impartiality can be overcome only by specific evidence demonstrating actual bias or a particular combination of circumstances creating an unacceptable risk of bias. Unless such evidence is produced, we remain confident that state administrative agency adjudicators will evaluate factual and legal arguments on their merits, applying the law to the evidence in the record to reach fair and reasonable decisions. As we explain, any tendency for the agency adjudicator to favor an agency attorney acting as prosecutor because of that attorney's concurrent advisory role in an unrelated matter is too slight and speculative to achieve constitutional significance. HOLDING: It did not violate license holder's right to due process for the prosecuting agency attorney to simultaneously serve as an advisor to the Board on an unrelated matter. The decision reversed the Court of Appeal's judgment. The Supreme Court's decision effectively overruled the decision in Quintero v. City of Santa Ana, 114 Cal. App. 4th 819 (Cal. Ct. App. 2003). The Quintero court held that the internal separation of functions on a case-by-case basis was insufficient to satisfy the constitutional requirements for due process of law, and that an administrative agency's internal separation of functions must be complete not only as to each individual case, but as to all cases, related or unrelated, that are pending before the agency at any given point in time. In the case of Watsonville’s disciplined firefighter, the City hired a separate attorney from an outside law firm to advise the department and the City Attorney had no communications of any kind with the department or anyone else involved in the case except the Commission. The City could have hired an attorney from the same law firm if it followed particular protocols. Instead the City staff selected an attorney from a different law firm to avoid even an appearance of impropriety. It is also important to note that no one involved in the hearing process, including the employee ever claimed the City Attorney had a conflict of interest or any improper communications. The City follows best practices and the City’s practices well exceed the due process protections afforded under California law. Response: Watsonville City Manager – WILL NOT BE IMPLEMENTED In a series of California published cases over the last few years, California courts have been very clear that it is perfectly proper for the City Attorney to represent the Commission. In Morongo Band of Mission Indians v. State Water Resources Control Board, 45 Cal.4th 731 (February 9, 2009), the California Supreme Court addressed this very issue. In construing the constitutional due process right to an impartial tribunal, we take a more practical and less pessimistic view of human nature in general and of state administrative agency adjudicators in particular. In the absence of financial or other personal interest, and when rules mandating an agency's internal separation of functions and prohibiting ex parte communications are observed, the presumption of impartiality can be overcome only by specific evidence demonstrating actual bias or a particular combination of circumstances creating an unacceptable risk of bias. Unless such evidence is produced, we remain confident that state administrative agency adjudicators will evaluate factual and legal arguments on their merits, applying the law to the evidence in the record to reach fair and reasonable decisions. As we explain, any tendency for the agency adjudicator to favor an agency attorney acting as prosecutor because of that attorney's concurrent advisory role in an unrelated matter is too slight and speculative to achieve constitutional significance. HOLDING: It did not violate license holder's right to due process for the prosecuting agency attorney to simultaneously serve as an Does Appearance Trump Substance? ∫ 7 advisor to the Board on an unrelated matter. The decision reversed the Court of Appeal's judgment. The Supreme Court's decision effectively overruled the decision in Quintero v. City of Santa Ana, 114 Cal. App. 4th 819 (Cal. Ct. App. 2003). The Quintero court held that the internal separation of functions on a case-by-case basis was insufficient to satisfy the constitutional requirements for due process of law, and that an administrative agency's internal separation of functions must be complete not only as to each individual case, but as to all cases, related or unrelated, that are pending before the agency at any given point in time. In the case of Watsonville’s disciplined firefighter, the City hired a separate attorney from an outside law firm to advise the department and the City Attorney had no communications of any kind with the department or anyone else involved in the case except the Commission. The City could have hired an attorney from the same law firm if it followed particular protocols. Instead the City staff selected an attorney from a different law firm to avoid even an appearance of impropriety. It is also important to note that no one involved in the hearing process, including the employee ever claimed the City Attorney had a conflict of interest or any improper communications. The City follows best practices and the City’s practices well exceed the due process protections afforded under California law.

Up a Creek without a Financial Paddle The Lompico County Water District

22 pages 10 findings 2 recommendations

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Findings & Recommendations 10 findings

F1: Upon reviewing annual audits, the Grand Jury determined that LCWD has been operating at a deficit for at least the past five years. LCWD budgets are incomplete, inaccurate, and do not provide for economic uncertainties or a capital improvement plan. • Revenue to the district comes from customer water bill payments and a percentage of property taxes refunded to the water district from the State. In two recent years, a portion of the tax money was not released to the district on schedule because of the State’s budget crises. Although that money now has been released, the water district finances remain in a deficit status. • The approximate revenue to LCWD is $400,000 annually. The Grand Jury was unsuccessful in its efforts to obtain an accurate copy of the district’s budget, including up-to-date revenue and expenditure figures. The budgets received were incomplete, were missing information, and did not include a capital improvement plan or a reserve account. • Three redwood water storage tanks have serious leaks and need to be replaced. Moreover, the system of old lateral pipes going to residences needs to be replaced due to manufacturer defects in the pipes originally purchased by the district. Up a Creek without a Financial Paddle ∫ 175 Approximately 40 percent of the plastic lateral pipes have been replaced with copper. Much of the replacement work was done on an emergency overtime basis, costing the district additional money. • The ready-to-serve (RTS) rate, which must be paid by every customer before any charge for actual water usage, is $82.64 every two months; this includes the most recent rate hike of $15 per billing period. The actual water usage portion of the bill is based on a tier system calculated on the amount of water used in the current billing cycle. Bi-Monthy Residential Charge for Average Santa Cruz County Customer (5/9 x 3/4" meter and 20 CCF usage) City of Watsonville Central Water District San Lorenzo Valley Water District Soquel Creek Water District City of Santa Cruz Scotts Valley Water District Davenport County Water District Lompico County Water District $0 $20 $40 $60 $80 $100 $120 $140 $160 $180 Source: Santa Cruz LAFCO: Countywide Service Review - June 2005 Until very recently, customers’ water bills were not itemized to show the amount in each category on an individual’s water bill. LCWD has the highest water rates of any public district in the county. This was true in 2005, as revealed in the chart below, and it is still true today. • The board of directors was dependent upon staff for all financial and budgetary information. Board members indicated that their financial oversight of the water district budget was hampered by their lack of direct access to information maintained on the district’s computer. • An independent audit in 2008 recommended that LCWD hire a qualified bookkeeper. This recommendation was not implemented. 176 ∫ Santa Cruz County Grand Jury Final Report 2009-2010 • After the secretary and the district manager were fired in early 2010, the board of directors became aware that the district’s financial information was disorganized, incomplete, inaccurate, or missing altogether. Additionally, the board found many overdue bills in the office. • The Santa Cruz County Auditor-Controller’s office performed an Independent Accountant’s Report on Applying Agreed-Upon Procedures at the request of the LCWD board of directors and presented the report on December 3, 2009. The audit examined payroll procedures for the three-year period of June 30, 2005, through June 30, 2008. That report, now part of public record, indicated the following: o Pay rates for this three-year period were provided for the secretary but not the district manager. o At the time of the LCWD 2008 official audit by an outside auditor, the accrued compensation for district employees for unpaid vacation and overtime since 1999 had grown to $140,000. o Numerous errors abound in timekeeping and payroll processing, including inaccuracies in tracking forms, inaccurate reporting for the California Public Employees Retirement System (CalPERS), and intermittent omission of state and/or federal tax withholdings. o LCWD did not provide any evidence of payroll-related policies for this report, which includes executive leave accrual guidelines, board-approved minutes authorizing various cost of living adjustments (COLA), and other payroll details. o During the period analyzed, there were numerous examples of apparent misreporting of on-call pay, overtime pay, executive pay, and vacation time, including lack of reporting state and federal taxes and correct hours for CalPERS, ultimately resulting in loss of district funds. • Since July 1, 2009, at the request of the LCWD board of directors, the County Auditor- Controller’s office has taken over the function of paying the bills and payroll. They also have been extending “dry period financing” to cover payroll and bills when there have not been adequate district funds on hand to cover these expenses. The County covered two pay periods in February 2010 due to lack of revenue in LCWD. Once the tax revenues are distributed to the water district in April 2010, the Auditor-Controller’s office, by statute, will no longer be able to extend financing to LCWD. • Due to the District Attorney’s arrest of the district secretary for embezzlement, the most recent independent auditor stated that a detailed forensic audit is required, which could push this year’s accounting costs to approximately $20,000. Up a Creek without a Financial Paddle ∫ 177 • PG & E has threatened to cut off power to LCWD for failing to pay bills in a timely manner and for ignoring two negotiated payment plan agreements. As of March 2010, LCWD had an outstanding bill of $2,700 with PG & E. • LCWD currently is on a cash-on-delivery basis with suppliers. In March 2010, the district could not pay for the chemicals needed for the filtration system and had to appeal to the County of Santa Cruz to cover the bill. Response: Lompico County Water District Board of Directors – AGREE, with the exception of current budget. As of July 1, 2009 the budget is filed with the County and included with each monthly board agenda packet showing all income and expenditures. The budget for 2009-2010 allowed for $23,000 excess revenue over appropriations, which was designated to reserves.

Related Recommendations (2)

R1: The Santa Cruz County Grand Jury recommends that the board of directors of LCWD should continue to evaluate and, if appropriate, pursue a merger with the San Lorenzo Valley Water District (SLVWD) using one of the three options listed below. Although many residents of Lompico are passionate about their independent water district, the Grand Jury finds the ongoing crises facing this water district too overwhelming for it to handle by itself. Three merger options are listed in order of increasing complexity and time: (1) A working alliance with SLVWD using a Joint Powers Agreement (JPA) which is established by the two water district boards of directors. This type of agreement is very flexible. For instance, it could be used for management of the districts only, and can be revised as necessary. A JPA could go into effect immediately and could in time lead to LAFCO reorganization of the district. (2) A consolidation of LCWD and SLVWD through LAFCO. If the boards of each district file with LAFCO for consolidation, it would happen automatically. This process generally takes about six months. (3) Reorganization through application to LAFCO. Any party can file directly to LAFCO, for example, a group of property owners, registered voters, or a board of directors. Whoever applies pays the filing fee. This process usually takes at least a year and a half. Response: Lompico County Water District Board of Directors – REQUIRES FURTHER ANALYSIS The board is currently exploring the possibility closest to item (2), which would require dissolution of Lompico Water District; San Lorenzo Valley Water District would then request a Sphere of Influence amendment for the annexation of the territory of Lompico. The board has held a series of public meetings for education and community input. This action will require further negotiations of indeterminate time, and is also subject to the timeframe held by the LAFCo review process. Response: Santa Cruz County LAFCO Directors – THIS RECOMMENDATION SHOULD BE IMPLEMENTED AS QUICKLY AS POSSIBLE. This section has not been implemented yet because the Lompico and San Lorenzo Water Districts are studying their options, and no application has yet been filed with LAFCO. After receiving a consolidation or reorganization application, LAFCO will prepare a comprehensive report and conduct a public hearing on the application. LAFCO expects its review process and public hearing to take between three and six months. LAFCO staff has already provided information to Board Members of the Lompico County Water District and the San Lorenzo Valley Water District to explain the LAFCO processes. LAFCO staff attended a public forum at the Zayante Fire Station on July 8, 2010 at which the Lompico community discussed their options. LAFCO acknowledges the 2009-2010 Grand Jury’s thorough investigation of the Lompico County Water District, which emphasizes the problems facing the Lompico water system. Up a Creek without a Financial Paddle ∫ 187 LAFCO notes the Grand Jury’s recommendation, under Recommendation R2 on , that the Lompico County Water District evaluate an immediate merger with the San Lorenzo Valley Water District. In the last ten years, LAFCO has reviewed two applications to “merge” water systems into the San Lorenzo Valley Water District--the Mañana Woods Mutual Water Company and the Felton Service Area of the California-American Water Company. Both mergers were complicated. In both cases, the San Lorenzo Valley Water District presented a professional service plan, LAFCO authorized the mergers, the affected communities found the costs to be reasonable. The San Lorenzo Valley Water District is now operating both of the merged systems in a manner consistent with the service plans that accompanied the original applications to LAFCO.

R2: The Santa Cruz County Grand Jury recognizes the possibility that LCWD might want to reorganize and recast itself as a viable water district. The difficulty of the challenges involved should not be minimized. Continuing the status quo would almost certainly lead to financial collapse and possible bankruptcy. If the board of directors of LCWD chooses this option, to remain an independent, unassociated water district, the following actions would be critical in the restructuring: (1) Adopt a clear and thorough set of bylaws as a binding ordinance. (2) Establish a clear and binding personnel hiring and management system, and follow bylaws and the guidelines in the Personnel Manual when hiring staff. (3) Separate business operations/administration from maintenance operations to allow the manager to run the district in a financially prudent manner without the potential conflict of interest that exists when serving two roles. (4) Hire a permanent, qualified bookkeeper. (5) Develop a training program for the directors to educate them in the business operations of a water utility, including: budgets and finance, parliamentary procedures, water utility functions. (6) Create a reliable system to provide the board of directors full access to all of the district’s business. (7) Generate and implement a new financial business plan that includes: • a fee structure that guarantees that all operational expenses can be met, • an immediate assessment on all property owners to fund a capital improvement fund and a reserve fund, • a long range plan to increase revenues incrementally to continue to build the capital improvement and reserve funds, and 188 ∫ Santa Cruz County Grand Jury Final Report 2009-2010 • the implementation of all recommendations made by the County Auditor- Controller’s office in the recent public report of December 2009 titled County of Santa Cruz Report on Agreed-Upon Procedures of the Lompico County Water District For the Period June 30, 2005 through June 30, 2008. Addressing all the recommendations in (R2) would be daunting. It is unclear whether the current or future boards of directors will have the ability, knowledge, and strength-of-purpose to accomplish these tasks in a time frame that will prevent LCWD from financial or infrastructure collapse. The Grand Jury highly recommends that LCWD evaluate an immediate merger with SLVWD (R1). Doing so will not necessarily be less expensive than the changes suggested in R2 but could prevent the failure of the water system. Response: Lompico County Water District Board of Directors – REQUIRES FURTHER ANALYSIS, PROBABLY NOT POSSIBLE Perhaps if the board five years ago had been made aware of the district’s situation, they could have made the corrections necessary to survive. The current board is working to resolve financial, management and structural problems.

F2: Employee costs including compensation and accrued benefits have escalated in recent years, placing a significant strain on the district’s limited resources. • With a budget of approximately $400,000 in revenue, LCWD spends about $300,000 annually on personnel costs for three employees. The remainder of the budget, approximately $100,000, is left to run the district, to make repairs, buy replacements, and maintain water quality. This amount has proven insufficient to meet the district’s needs. • During the five-year period 2001-2006, approximately 55 percent of the district budget went for employee expenses. By 2007-2009, these expenses increased to approximately 75 percent of the budget due to increased salaries and benefits. At the same time, revenue remained flat due to reduced tax revenues and reduced income from customers because of drought-condition water conservation. • In 1999, Resolution 99-679 was approved by the board placing a two-year limit on compensation and benefit accruals. However, the Grand Jury found no evidence that the board adhered to this resolution thus creating a substantial unfunded liability to LCWD. • Records indicate that day laborers’ wages were paid out of petty cash funds and were not part of budget planning and development. Response: Lompico County Water District Board of Directors – AGREE

Related Recommendations (2)

F3: LCWD does not have the funds to conduct the preparatory work required to apply for grants or loans. The generally weak national and local economy severely hampers LCWD’s ability to qualify for additional working capital. Most large projects require studies and pre-engineering costs which the district cannot afford. Furthermore, grant money generally is restricted to innovative projects and cannot be used to replace leaky tanks or to subsidize operational costs. 178 ∫ Santa Cruz County Grand Jury Final Report 2009-2010 Response: Lompico County Water District Board of Directors – AGREE Financial Conclusions C1. Neither the board of directors nor management fulfilled their fiscal responsibilities to create and maintain a budget to meet the financial and infrastructural needs of the water district. C2. LCWD has not created an adequate rate structure to sustain the operation of the water district, and so the revenues are insufficient to cover the district expenses or the present and future facility needs and obligations. C3. While elsewhere salaries have remained flat and some City and County employees have been furloughed due to the State financial crises, LCWDs salaries and benefits have increased in the past few years, further contributing to the deteriorating financial conditions of the district. C4. The handling of the district’s financial resources by the boards of directors and management staff has left LCWD on the verge of bankruptcy. Governance The LCWD is governed by a board of five directors and managed by a single general or district manager. Registered voters in the Lompico water district elect the five members of the board. Candidates do not need to meet any qualifications, other than being a qualified voter in the water district, or hold any special credentials, and frequently they do not have any relevant experience to hold this office. Once elected, they receive limited training to prepare them for the considerable challenge of governing a district that supplies water to 500 homes. Since the early 1960’s, the board has suffered financial and infrastructure demands that have led to turmoil and dissension, resulting in frequent resignations by board members. The resulting vacancies were filled by board appointments on some occasions and by uncontested or hotly contested elections on other occasions. In the 1970’s the board of directors planned an ambitious $2 million modernization and upgrade of the water distribution system. It successfully financed the project with bonds and grants and completed the work in 1979. Just six years later, however, several directors were recalled as the result of an outstanding bill for $138,000 for a mandated San Lorenzo Valley septic system study; the septic system was not built and the debt eventually was forgiven. In April 1987, the Scotts Valley Banner published an article titled “Down the Drain” describing the directors’ dissension and indecision in collecting bills, a situation that cost LCWD thousands of dollars. In May 1987, the Santa Cruz Sentinel reported that two directors resigned. In the fall of that year, the Santa Cruz County Grand Jury began an investigation of the LCWD. Its report, Lompico Water District, was published in June 1988 and described the lack of governance and oversight and the poor accounting that resulted in the LCWD’s failure to collect thousands of dollars owed by customers. The report revealed that the board of directors tried to manage the water district itself for several years after the departure of the district manager. The Grand Jury Up a Creek without a Financial Paddle ∫ 179 recommended “a public dialogue concerning some combination or coordination of operations with the neighboring San Lorenzo Valley Water District.” During the 1990’s, despite frequent turnovers in board membership, numerous resolutions were passed only to be later ignored by subsequent boards. As an example, in 1999 a two-year limit on vacation and overtime accruals was approved, but successive boards appear to have ignored or were not made aware of the limit. Furthermore, while water rates were raised occasionally, there was never enough revenue to create a healthy reserve fund for replacing equipment. From 2006 to 2008, district residents were divided on what role LCWD should play in replacing a section of Lake Boulevard’s main water line loop that failed in a landslide. The issue was prominently featured in the November 2008 election, with eight candidates competing for three of the five board seats. Two new directors were elected and an incumbent was re-elected. Months of difficult discussions followed, and on November 23, 2009, the board voted 2-2 with one abstention on whether to apply for an extension on a request for FEMA funds to reconnect the water line. Three years after the event, the board could not agree on how to fix the problem. Governance Findings

Related Recommendations (2)

F4: Through a review of district records and interviews with past and present directors, the Grand Jury determined that the boards of directors have failed to adequately perform some of the basic duties of a governing board. • LCWD directors indicated that they had little or no training to be board members. In addition they have not taken sufficient advantage of opportunities to educate themselves, nor have they created a training manual or handbook to appropriately educate successive boards. • The LCWD board has not created rules or guidelines for its proceedings, such as district bylaws, as required by the California Water Code section 30530. • The Board Policy Manual created in 2009 was duplicated from San Lorenzo Valley Water District. • Interviews and documentation reveal that the LCWD consistently failed to hold regular board and committee meetings. • LCWD board members stated that the agenda for meetings did not reflect items board members requested to be placed on the agenda. • The Grand Jury observed that some LCWD board members were not familiar with using Sturgis’ Rules of Order and that they sometimes failed to treat each other and members of the public with civility when conducting their meetings. • The Grand Jury’s review of meeting minutes from 2006 to the present revealed that the LCWD board did not monitor minutes for completeness or accuracy. 180 ∫ Santa Cruz County Grand Jury Final Report 2009-2010 • Letters from the District Attorney’s office in 2008 and 2009 indicated that citizens filed complaints about alleged violations of the Brown Act. The District Attorney did not find sufficient grounds to warrant criminal charges. Response: Lompico County Water District Board of Directors – AGREE, with updates. In 1964, the Board of directors of Lompico County Water District adopted Ordinance 2, which defined when and where the board would meet to conduct meetings, the order of the agenda, and that the board of directors shall use Robert's Rules of order. The Board of directors reviewed Ordinance 2 at a special meeting on June 8, 2010. The board of directors has been improving its compliance with Robert's Rules of order in conducting meeting. Within 72 hours of the regular board meetings, the District Secretary writes up the minutes from the meeting, and emails the minutes to each director for review. The corrections, if any are transmitted back to the District Secretary for update. The Board conducted a special meeting on June 8, 2010 to review Ordinance 3 Rules and Regulations of Water Service and enhance their understanding of those rules and regulations. The original Ordinance 3 was passed in 1964. In the 45 1/2 years since, Ordinance 3 has undergone numerous additions and changes. While these changes have been available in the district's files, it was difficult to know all the rules, as they where found in more than 40 different ordinances. The board has produced a single document containing all of Ordinance 3, complete with additions and changes from the last 45 1/2 years. The board members are in the process of providing needed updates for consideration by the board. The resulting ordinance will contain updates needed due to a reorganization of the staff positions and duties, reorganization of the ordinance to improve its readability, as well as clarifications, and other changes needed to reflect county policies. The board will be reviewing and consider for adoption the resulting codified version. The result will be one document that defines the rules and regulations of water service. The board recently adopted a budget for fiscal 2010 - 2011 with revenue excess of $32,675. This includes one time large expenses for forensic audits. These numbers are based on reasonable forecasts of income. The board has scheduled a workshop on planning and rate setting with a professional in small water districts from the California Rural Water Association. The board and District Secretary have aggressively pursued collection of delinquent water charges and the board is in pursuit of placing delinquent water charges on the tax rolls to recover long delinquent accounts receivable. The delinquent water charges have not been included in the income forecasting. The pursuit of delinquent water charges has brought $13,524.00 in funds to the district. The 5 day disconnect notices for remaining delinquent charges for water services have been sent, and the district expects additional collection of delinquent charges for water service as a result. By the end of the billing cycle for May- June 2010, any remaining accounts that are delinquent will be either making payments under an agreed to payment plan, or will be locked off for non-payment. Up a Creek without a Financial Paddle ∫ 181 The board has educated themselves on the billing and collection procedures described in the Rules and Regulations of Water Service, and has brought action to bring enforcement of collection of delinquent water charges through disconnection of water service. The board’s enforcement of the disconnection process is now current. Per Ordinance 3, Rules and Regulations of Water Service, Accounts that are delinquent will be disconnected within 60 days from billing of charges not paid (if not under payment arrangements). Response: Santa Cruz County LAFCO Directors – AGREE to the extent that LAFCO does not have any information that contradicts the findings. In its role as a boundary regulatory agency, LAFCO gathers information for its periodic preparation of service reviews and agency spheres of influence. When a boundary change application is filed, LAFCO prepares a detailed staff report that analyses the proposed boundary change. LAFCO has not received a boundary change application concerning the Lompico County Water District in many years. Therefore, LAFCO does not have first-hand information concerning any of the subsections of Finding F4. LAFCO does maintain a file of district bylaws that special districts in Santa Cruz County voluntarily submit, and any public agency is welcome to use these samples when drafting a set of bylaws.

Related Recommendations (2)

F5: The board of directors failed to adequately oversee the financial activities of the water district and to verify that operations were conducted according to good business practices, and they made questionable business decisions. • LCWD board did not set rates and charges at a level sufficient to provide for repairs and depreciation of works owned or operated by the district as required by California Water Code section 31007. • LCWD directors did not set rates and charges sufficient to cover the operational expenses of the water district, in part because they lacked the background or knowledge of bookkeeping and budgeting procedures in general, and they did not demand the information specific to the district that would allow them to set rates reasonably. In interviews, board members stated they were reluctant to impose higher rates on their friends and neighbors. • In 1998, the LCWD board made a voluntary $100,000 CalPERS retirement payment on behalf of the district manager for ten years he had worked for the district prior to the adoption of the retirement program. • LCWD boards ignored or did not know about a 1999 resolution to cap the accrual of vacation and overtime pay to two years. The Grand Jury was unable to find any official action to rescind the limits. However, the board did re-impose the limits in 2009. 182 ∫ Santa Cruz County Grand Jury Final Report 2009-2010 Response: Lompico County Water District Board of Directors – AGREE Response: Santa Cruz County LAFCO Directors – AGREE to the extent that LAFCO does not have any information that contradicts the findings. As a boundary regulatory agency, LAFCO does not gather detailed information such as retirement system payments or employee vacation accrual rules. LAFCO does not have information that verifies or counters the Grand Jury’s findings.

Related Recommendations (2)

F6: The past and present board of directors failed to provide adequate oversight of the personnel and personnel functions and activities of the district. • The original Personnel Manual was rewritten and approved in early 2010. The approved manual is still incomplete because there are no job descriptions. • The LCWD board did not conduct adequate due diligence to confirm the qualifications of new hires, specifically the district secretary. • The LCWD board did not systematically conduct in-depth performance evaluations for the district manager. • The LCWD board did not hold the site management adequately accountable for day-to- day activities, long-term planning, and financial tasks. Response: Lompico County Water District Board of Directors – PARTIALLY AGREE The current board, when made aware of the Personnel Manual, took steps to enforce and update these policies. The board met with extreme resistance from the manager and secretary on day-to-day activities, long-term planning and financial tasks. Governance Conclusions C6. The boards of directors consistently demonstrated a lack of knowledge and oversight of all aspects of the district’s operations: governance, finances, management and facilities. C7. The directors often appeared to disregard the California Water Code, the Director’s Guide for Setting a Budget, the Lompico Water District Manual, the Board Policy Manual, and resolutions passed by preceding boards. C8. Members of the board of directors appear to lack the financial knowledge necessary to develop and oversee a balanced budget and consequently may not be adequately prepared to guide the district in a financially sustainable direction. C9. Because agendas are poorly developed and meeting minutes are incomplete and inaccurate, there is a lack of reliable records to allow consistent governance of the district’s business. C10. Board policies pertaining to personnel matters have at times not been followed. Up a Creek without a Financial Paddle ∫ 183 C11. The board of directors did not hold the site management and staff sufficiently accountable from day-to-day activities to long-term planning. Management The LCWD district manager is an at-will employee reporting to the board, and management duties are outlined in the Personnel Manual and referenced in the Board Policy Manual. The district manager is responsible for the business activities and the day-to-day operations of the district. The other employees (two at the time of this investigation: the district secretary and the operations technician) report to the manager, who also serves as the safety officer for the district. While there have been many members of the board of directors through the years, there has been only one district manager over the past 20 years. Management Findings

Related Recommendations (2)

F7: The board of directors depends on the LCWD staff for accurate information delivered in a timely manner. • The LCWD board did not receive timely and accurate board meeting agendas. Furthermore, protocol and board requests regarding the preparation of the agendas were at times disregarded or altered. • For the last five years, management did not provide complete and realistic budgets for review and approval by the board. • The urgency of infrastructure repairs was evident upon inspection of the physical plant. However, board members stated that management did not stress the importance of the need for immediate repairs. Response: Lompico County Water District Board of Directors – AGREE

Related Recommendations (2)

F8: The business and personnel activities of the district were not always conducted in a professional and appropriate manner. • The district’s independent auditor recommended hiring a bookkeeper in 2008; however, the district did not hire one, citing the lack of funds. • In 2009, a district secretary was hired who had no bookkeeping experience, which was a specific qualification for that position. Selection protocol established by the board, such as posting the position in the newspaper, was not followed. • Performance reviews for the secretary and the operations technician were not performed annually as specified in the Personnel Manual. • Daily work logs sometimes were not completed and were not given to the board even when requested. 184 ∫ Santa Cruz County Grand Jury Final Report 2009-2010 • The office file of customer work was not updated on a daily basis. • Creditors’ bills were not always paid in a timely fashion. Board members revealed that checks were written and then stored in the district office safe until adequate revenues arrived to cover the checks. Consequently, in July 2009 the board of directors asked the Santa Cruz County Auditor-Controller’s office to take over payroll and other accounts payable functions. • LCWD received a letter dated February 1, 2010, from the State Controller’s Office Division of Accounting, informing it that the Annual Report of Financial Transactions had not been filed for the fiscal year ending June 30, 2009. The State imposed a $5,000 penalty for non-filing. • The Santa Cruz County Auditor-Controller’s office performed an Independent Accountant’s Report on Applying Agreed-Upon Procedures at the request of the LCWD board of directors and presented the report on December 3, 2009. The report revealed that sufficient and accurate data on payroll procedures was not provided to the County despite multiple requests. • Communications and unresolved complaints from customers sometimes were not recorded in the minutes or addressed, nor were they always reported to the board. • The main and satellite offices, and the records and files associated with the district’s business, were not maintained in an organized, orderly fashion. Response: Lompico County Water District Board of Directors – AGREE The current board is addressing all items.

Related Recommendations (2)

F9: The infrastructure was not maintained in good and working order. • The California State Public Health Department (CSPH) shut down the LCWD water treatment plant from May 6, 2010 to May 14, 2010 because the water treatment filters (Memcor filters) in the plant were no longer viable. The filters dated from 1996 and the effective life span of the filters, according to their manufacturer, was seven years. New Memcor filters were installed on May 12, 2010. • The monthly reports to the CSPH documenting the turbidity of the drinking water in LCWD were not accurate. The chart wheels that record daily turbidity provide the information that is transferred to the report form that is submitted to the CSPH. The information on the chart wheels should be exactly the same as information on the reports. Grand Jury members compared the two and noted that they did not match. • A written capital improvement plan (CIP) was not found. Up a Creek without a Financial Paddle ∫ 185 • There was no immediate systematic replacement plan for the faulty lateral pipes; consequently, failing pipes needed emergency repair, causing customers inconvenience and resulting in additional expense in overtime pay. • Facility maintenance was not done on a routine basis; for example, the fire hydrants had not been flushed annually nor had the gate shut-off valves been checked regularly. • There was no plan for the repair or replacement of the three finished water storage tanks that have severe leaks. Water tanks are leaking so seriously that pumps from the four district wells are being overworked to keep up with the loss of water. In addition, there is extra expense for the chemicals and power to treat additional water. Response: Lompico County Water District Board of Directors – AGREE

Related Recommendations (2)

F10: The safety of LCWD staff and the Lompico community was put at risk. • Frequently just one employee responded alone to night emergencies, regardless of the weather. • Employees failed to shore up the sides of the trench and walls of a deep excavation pit. • The fire hydrants had not been flushed for several years, although they should be flushed annually. • Zayante Fire District was not always notified of low water conditions that were a consequence of the tank leaks. • Zayante Fire District was not always notified when LCWD was doing repairs or maintenance on the tanks and there was low water pressure or no water at all. Response: Lompico County Water District Board of Directors – AGREE Management Conclusions C12. There often was poor communication between the board of directors and district management, and the board consistently lacked the accurate and complete information necessary to help it govern the district competently. C13. The condition of the district’s finances is so poor that the district is near collapse. Additionally, the infrastructure has deteriorated almost to the point of failure, and the board of directors was not properly apprised of the true condition of either the finances or the facilities. C14. The lack of water or water pressure puts the residents of the community at risk of serious fire damage, particularly when the Zayante Fire District is not informed of conditions. 186 ∫ Santa Cruz County Grand Jury Final Report 2009-2010

📋Back to the Future: Regional Gridlock and Local Planning Paralysis

6 pages 5 findings 3 recommendations

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Findings & Recommendations 5 findings

F1: Traffic congestion on Highway 1 corridor is problematic.

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F2: Local jurisdictions do not implement the regional transportation plan created by the RTC.

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F3: Lack of consensus between the local jurisdictions and the RTC staff obstructs the coordination of the local transportation plans with the Regional Transportation Plan.

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F4: Each agency’s General Plan is an integrated document that includes housing and transportation as elements. There is no mandated link between the local agency’s General Plans and the Regional Transportation Plan.

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F5: No consistent long-term funding source is currently available for RTC planning.

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Additional Recommendations 3

Not linked to specific findings.

R1: Transportation sections of all county and city general plans should be written by Regional Transportation Commission staff.

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R2: The local jurisdictions should review the transportation sections developed by RTC staff for adequacy every two years and RTC staff should be required to revise when necessary. Back to the Future ∫ 37

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R3: The RTC should develop cost estimates and pursue stable funding sources to implement recommendations one and two.

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📋City of Watsonville: Fastest Growing City Looking for Leadership and a Fire Truck

24 pages 14 findings 9 recommendations

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Findings & Recommendations 14 findings

F1: The purchasing procedure used by the City to buy the fire truck appears ad hoc and incomplete. It bypasses commonly used financial controls that would protect the buyer and provide accountability of public officials.

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F2: The fire truck transaction appears suspect due to contradictory documents.

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F3: The City Manager has not provided the City Council with regular updates that reflect changes in the fire truck transaction in the three years since the issuance of the payment.

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F4: The City of Watsonville Community Development Department issues land use and building permits without consideration of the presence of hazardous materials or recorded land use restrictions.

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F5: No permit application review procedure exists at the Community Development Department to identify known documented hazardous materials sites.

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F6: The full costs of litigation to justify future development surrounding the airport have not been disclosed to the public.

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F7: The City has spent over $1 million in scarce funds on litigation resulting from attempts to increase development around the airport.

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F8: City Staff has repeatedly failed to provide complete and accurate information to the City Council, Planning Commission, and the public.

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F9: It was not possible to evaluate the effectiveness of the WRDA because adequate information is not provided to the public.

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F10: The City of Watsonville does not provide a publicly available summary of WRDA activities, revenues, or expenses.

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F11: The City Council failed to fully consider project costs prior to Manabe-Ow project approval.

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F12: The City Staff misrepresented the plans to finance the Manabe-Ow project prior to the City Council’s approval in 2010.

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F13: The City Staff favored securing WRDA funding to finance the project but withheld this information from the City Council and the public prior to project approval.

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F14: City Staff withheld information regarding the requirement for legislative action to include the Manabe-Ow property in the WRDA prior to project approval.

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Additional Recommendations 9

Not linked to specific findings.

R1: The City Manager should make regular reports to the City Council, in open session, regarding the performance of significant contracts, i.e., $50,000 or greater.

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R2: The City should adopt a “best practices” government procurement policy. The California Society of Municipal Finance Officers is a particularly useful resource for the development of such a policy.[25]

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R3: City Staff with purchasing authority and responsibility should receive adequate training to successfully execute contracts and process transactions. City of Watsonville ∫ 17 Environmental Health Investigation The Grand Jury discovered that the City of Watsonville has no policies or procedures in place to check for environmental hazards for any given development site prior to the issuance of land use or building permits. Most of the pertinent documents related to this investigation may be reviewed in various locations throughout the EnviroStor web page for “PG&E, WATSONVILLE #1 MGP (44490007).”[36] The site investigated is located at 618 Main Street in Watsonville. Extensive past environmental investigations have identified hazardous residues in the soil resulting from historical operations at the site. The contaminants identified in the reports are known to cause cancer or birth defects and include polynuclear aromatic hydrocarbons, petroleum hydrocarbons, arsenic, and hexavalent chromium. It was also determined that, as a result of the contamination, the “groundwater presents an unacceptable threat to human health and safety.”[27][36] The site is located within the historic footprint of the Watsonville-1 Manufactured Gas Plant, which operated from 1871 until 1906. The plant used coal and oil to produce gas for lighting, heating and cooking. Some of the hazardous byproducts from the manufacturing process remain at the site. Pacific Gas and Electric Company (PG&E) eventually took over ownership of the site and used it as a customer service facility until 1989, when it was leased to its present owner and converted into a restaurant (Jalisco).[36] The site was purchased by its present owner from PG&E on February 27, 2001, subject to a recorded “Covenant to Restrict Use Of Property, Environmental Restriction,” which was found to be “reasonably necessary to protect present or future human health or safety or protect the environment as a result of the presence on the land of hazardous materials as defined in Health & Safety Code section 25260.” The ongoing environmental investigation at the site is under the supervision and authority of the California Department of Toxic Substances Control (DTSC) (Department).[27][28][36] The restrictions described in the Covenant include prohibited uses (residence, hospital, school or day care), prohibited activities (raising of food or extraction of groundwater for consumption) and requirements for soil management: 4.02 (a) “No activities that will disturb the soil (e.g., excavation, grading, removal, trenching, filling, earth movement or mining) shall be allowed on the property without a Soil Management Plan and a Health and Safety Plan approved by the Department.” 4.02 (b) “Any contaminated soils brought to the surface by grading, excavation, trenching or back-filling shall be managed in accordance with all applicable provisions of state and federal law.” The Covenant further mandates an interim remedial measure to prevent the release of hazardous substances from the contaminated soil. This includes maintaining the current asphalt parking lot, commercial building and other structures on the property, which are referred to as the “Cap.” 18 ∫ Santa Cruz County Grand Jury Final Report 2010-2011 4.04 (a) “Activities that may disturb the Cap (e.g. excavation, grading, removal, trenching, filling, earth movement, or mining) shall not be permitted on the Capped Property without prior review and approval by the Department.” Furthermore, sections 3.01 and 3.02 of the Covenant stipulate that the restrictions “run with the land,” and are “binding upon owners/occupants.” All owners and future owners of the property are required to adhere to the provisions of the Covenant.[27][36] The Grand Jury found that on two specific occasions, the Watsonville City Government failed to discover or provide information highlighting the fact that there are hazardous materials present on the site. On June 18, 2007, the City of Watsonville issued a “Correction Notice,” due to the start of construction, without a permit, of a courtyard seating area at the site.[29][36] After the city issued the correction notice, all required applications and plans were submitted, permits were obtained, and building inspections were performed.[30] However, NO assessment of the land use restriction or presence of hazardous materials was considered. On March 4, 2008, the Watsonville Planning Commission approved a Special Use Permit allowing liquor sales and special events on an outdoor patio at the site. The staff report included the finding that “Jalisco’s Restaurant has operated in its present location for 19 years. An 800 square foot patio was added to the restaurant for food service in the summer of 2007.” The staff report failed to provide any information concerning the environmental hazards and risks on the site.[31] In 1996 the California Environmental Protection Agency designated Santa Cruz County Environmental Health Services (EHS) as the "Certified Unified Program Agency" (CUPA) within the geographic boundaries of the County (including all four Cities). As the CUPA, EHS is responsible for enforcing State and Federal statutes and regulations as well as any applicable local ordinance.[32] However, since the City of Watsonville failed to discover the hazard or the land use restriction, EHS was not notified, and was unable to act in its capacity as the CUPA. EHS staff who were interviewed also stated that Watsonville City staff rarely contact them for advice or assistance. There are various databases available to the public online, that identify sites with known or suspected hazardous materials contamination. The Grand Jury easily found the site located at 618 Main Street listed on “EnviroStor,”[36] and “GeoTracker.”[38] EHS maintains a website with a link to known contaminated county sites, titled “Santa Cruz County ‘Site’ List.”[37] Nearly 700 county sites are identified on the list, including approximately 100 in the City of Watsonville alone. The site at 618 Main Street appears on the list and was also found in the “Fortis” document file maintained at EHS. The Watsonville Community Development Department staff first became aware the site was contaminated when they were interviewed by the Grand Jury. They were unaware of the land use restriction and the presence of hazardous materials on the site. They do not routinely make inquiries regarding these issues when processing permits. City of Watsonville ∫ 19 There was disagreement amongst the interviewees from different departments, commissions and the City Council as to whether the permit process needed to be revised to include a routine check of soil and groundwater contamination databases prior to issuance of a permit. It appears that the site construction activities permitted by the City of Watsonville caused an unauthorized release of hazardous materials. The Grand Jury notified EHS of a potential release; EHS subsequently referred the notification to the DTSC, the lead cleanup oversight agency.[33][34][36] The DTSC replied, “the disturbance of the soil...did not likely have any impacts on the public, workers who performed the construction, or the environment,” and that it would take no enforcement action at this time. However, it did direct that any future activities on the site that cause soil disturbance must be performed in accordance with the requirements of the Covenant.[35][36] Nevertheless, the Grand Jury maintains that the City of Watsonville permit procedures fail to recognize existing documented soil and groundwater contamination hazards that pose potential risks to public health and safety.

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R4: In collaboration with EHS, the City of Watsonville Community Development Department should develop a procedure to alert staff to the presence of hazardous materials on a site prior to the issuance of land use or building permits. Airport Investigation The Watsonville Municipal Airport is a lightning rod issue and is very divisive in the Watsonville community. Many Watsonville residents, including several members of the City Council, see no value in the Airport and would like it converted to affordable housing. On the other side are business leaders, the Watsonville Pilots Association, the Farm Bureau, and others, who support retaining the full capabilities of the Airport. The divisiveness of this issue is even underscored internally within the City. In direct contrast to the City Council majority opinion, the Airport’s benefits to the community, including economic, are touted and well documented on the City’s Economic Development Website “Watsonville Municipal Airport.”[39] Over the past five years, costly litigation over land use issues in areas surrounding the Airport has exceeded $1.2 million of limited City funds. The City is now embarking on a project to re- adopt its 2030 General Plan[40] to address deficiencies found by the California Superior Court.[41] 20 ∫ Santa Cruz County Grand Jury Final Report 2010-2011 With the City facing a pending budget deficit of $1.9 million, the Grand Jury believes the City Council should have a full public discussion of the airport issues and potential costs, solutions, and compromises, before proceeding down the path of another round of costly litigation. The Grand Jury has found that on matters concerning the Airport, the City Government has failed to act in a manner that is transparent, and failed to make decisions based on complete and accurate information. A chronology of events relating to the Airport over the past six years is as follows: 1. A 2005-2006 Santa Cruz County Grand Jury Investigation was prompted by the City Council’s adoption of Resolution 74-05[42] on April 12, 2005, which amended the City’s Airport Master Plan 2001-2020, in anticipation of the adoption of the WatsonvilleVISTA 2030 General Plan.[40] The Grand Jury report titled, “Watsonville Municipal Airport: Headed for a Crash,”[43] is informative and mostly still pertinent today. The following paragraphs are from this report (bolds and underlines added for emphasis): Watsonville Municipal Airport is a valuable asset to the City of Watsonville and to the entire County of Santa Cruz. While land-use planning around most airports is monitored by regional commissions specializing in airport issues, a unique loophole in California State law permits the Watsonville City Council to serve in this capacity for the airport. The airport's existence is now threatened because the city is meeting its mandated housing goals by planning housing developments in airport safety zones, which could lead to increased noise complaints and untold liability in the event of an accident. The airport is economically valuable to the city, providing steady employment, business opportunities, a substantial tax base, and drawing business and recreational visitors. Strategically, the Airport is a key asset in low frequency but high impact disaster relief efforts, as was demonstrated following the Loma Prieta earthquake. Before any irrevocable decisions are made, the benefits of the airport to the entire region must be carefully evaluated through the formation of an independent Airport Land Use Commission. Such a commission will provide an opportunity for community input and to make impartial land use decisions more frequently to protect this critical regional resource. The Watsonville Municipal Airport was constructed by the Navy during World War II on land purchased by, and incorporated into, the City of Watsonville. In 1947 the airport was transferred back to the city for $1 provided the land would be used as an airport in perpetuity. Initial construction consisted of two runways, both built to military specifications that make them suitable for use by heavy aircraft such as C-130s and business jets. Two runways are needed to accommodate weather variations. The primary runway, Runway 2-20, is the longest and can be City of Watsonville ∫ 21 used ninety-four percent of the time. The shorter runway, Runway 8-26, can be used ninety-eight percent of the time and is necessary not only for wind variations, but particularly in summer fog conditions. 2. During the Santa Cruz County Grand Jury’s 2005-2006 term, several additional airport actions occurred, which were not included in the report. (cid:190) An April 21, 2006, letter to the City of Watsonville from the California Department of Transportation (DOT),[44] included the following statements: “It is our position that Resolution 74-05 should be invalidated,” (bold and underlined for emphasis) and “If the City of Watsonville does not intend to implement the State’s request in complying with the State Aeronautics Act, please consider the subject letter as a request for an administrative appeal.” The City took no action on this letter. (cid:190) On May 23, 2006, the City Council adopted Resolution 114-06 (CM),[45] certifying the final Environmental Impact Report (EIR) for the WatsonvilleVISTA 2030 General Plan, and Resolution 115-06 (CM),[46] adopting the WatsonvilleVISTA 2030 General Plan and Findings. These resolutions incorporated the disputed Resolution 74-05[42] into the General Plan, despite the DOT’s position. 3. Since the Grand Jury Report was issued in June of 2006, additional activities concerning the airport have taken place. (cid:190) Two cases were filed and litigated: “Santa Cruz County Superior Court CV 154571, Watsonville Pilots Association et al., v. City of Watsonville, et al.,”[47] and “Santa Cruz County Superior Court CV 154572, Friends of Buena Vista, et al., v. the City of Watsonville et al.,”[48] (cid:190) On March 21, 2008, the Court “issued a statement of decision,” signed by Superior Court Judge Paul P. Burdick, in favor of the plaintiffs in both cases. (cid:190) On May 2, 2008, the Santa Cruz County Superior Court “entered judgment” for the plaintiffs, and issued a Peremptory Writ of Mandate,[49] “YOU ARE HEREBY COMMANDED...to set aside the certification of the Environmental Impact Report...and all your decisions, approvals and findings for the Watsonville Vista 2030 General Plan.” A key provision of the Writ is, 3. You are prohibited from implementing the Watsonville Vista 2030 General Plan or Resolution 74-05 (bold and underlined for emphasis) or basing any action on or engaging in any activity pursuant to the Watsonville Vista 2030 General Plan or Resolution 74-05, unless and until the environmental review and the Watsonville Vista 2030 General Plan and Resolution 74-05 are revised to comply with the Court’s Statement of Decision, and California law, including but not limited to its statutes and regulations known as the California Aeronautics Act, the California Environmental Quality Act ("CEQA") and the CEQA Guidelines and the Court is satisfied that you have complied with this peremptory writ of mandamus by way of a return to the writ.[49] (cid:190) The City of Watsonville appealed the ruling to the Court of Appeal of the State of California Sixth Appellate District on June 26, 2008. 22 ∫ Santa Cruz County Grand Jury Final Report 2010-2011 (cid:190) On March 15, 2010, the Court of Appeal of the State of California Sixth Appellate District denied the City's appeal,[50] required it to follow the trial court’s Peremptory Writ of Mandate, and further required the City to develop a Compliant Airport Land Use Compatibility Plan (ALUCP) consistent with the California Airport Land Use Planning Handbook. (cid:190) From interviews and documents provided by the City,[51] the Grand Jury discovered the City was required by the Court to pay $691,837.84 to the plaintiffs for their legal fees. The City also paid $442,346.10 to its own attorneys for the defense of the suit, for a total expenditure of $1,134,183.94. 4. While these legal actions were underway, the Planning Commission received an application for a permit for a commercial building to be located next to the airport. On August 4, 2008, the Planning Commission approved a special use permit for a 43,389 square foot light industrial building on Jennings Drive. The project became known as “Lawton.” The approval followed discussion and review of the information in the form of a Memorandum provided by City Staff. However, the City Staff failed to provide the following information to the Planning Commission: (cid:190) The Memorandum to the Planning Commission[52] makes no mention of the Writ of Mandate[49] affecting the property, which states, “You are prohibited from implementing the Watsonville Vista 2030 General Plan or Resolution 74-05.” (bold and underlined for emphasis) (cid:190) The Memorandum mentions “A Mitigated Negative Declaration,” but does not include the original negative declaration letter from the DOT,[53] which cites the Superior Court decision, and includes the statement, “Portions of the project site appear to be within the Safety Zones 1, 2, 3, and 6 for the Watsonville Municipal Airport.” (cid:190) A City letter attempted to mitigate the negative declaration,[54] but their letter had not been accepted by the DOT by the date of the meeting. This fact was not communicated to the Planning Commission by the City staff. Subsequent to this meeting, the DOT issued a letter[55] which includes the statement, “We further request that the Negative Declaration not be approved.” (cid:190) The Minutes of the Planning Commission meeting[56] include the statements, “Commissioner Martinez...” (Planning Commissioner at that time) “...noted the close proximity of the Airport to the project,” and “Principal Planner Boyle stated the proposed use is allowable in Zone 6 and is consistent in both General Plans.” Planner Boyle’s statements fail to inform the Commission of the DOT claims that the project is in Zones 1, 2, 3 and 6, or of the Writ of Mandate which prohibits the implementation of the WatsonvilleVISTA 2030 General Plan. It is not possible to know how the Planning Commission would have acted if they had received full information. They may have elected to approve the permit, they may have denied it, or they may have continued the matter and requested further information. The Watsonville Pilots Association and others subsequently filed suit[57] to stop the project, since it was in direct violation of the Peremptory Writ of Mandate issued on May 2, 2008. The Lawton City of Watsonville ∫ 23 Project was eventually dropped by the applicant due to the suit, and the City of Watsonville and the Watsonville Pilots Association negotiated a settlement to the suit. From interviews and documents provided by the City,[51] the Grand Jury discovered the City paid $48,000 to the plaintiffs for their legal fees. The City also paid $12,048.78 to its own attorneys for the defense of the suit for a total expenditure of $60,048.78. To summarize, ● In the first lawsuit, the city ended up paying $1.134 million in legal fees ● In the second lawsuit, the City settled and ended up paying another $60 thousand in legal fees.

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R5: The City Council should have a public discussion regarding future development surrounding the airport, including full disclosure by City Staff of all issues and potential costs, solutions, and compromises, to avoid another round of costly litigation. This public discussion should be held prior to development of the revised City General Plan 2030. Redevelopment Agency Investigation The City Manager, the recently retired Director of Redevelopment and Housing, and other senior city executives, both elected and staff, have made many public statements[58][59][60] concerning the importance of redevelopment funds to the City of Watsonville. Their statements emphasize how damaging the elimination of the Watsonville Redevelopment Agency (WRDA) would be to the city. There has been much discussion of Redevelopment Agencies (RDAs) since California Governor Brown’s recent proposal to eliminate them. The Grand Jury attempted to investigate the history of the WRDA to find quantifiable measures to evaluate its effectiveness, such as a list of projects undertaken; project costs and status; WRDA annual revenues and expenses; and bond obligations. The Grand Jury was never able to find this information. As of the start of our investigation, there was no publicly available information on the effectiveness of the WRDA. The Grand Jury reviewed the Watsonville “Redevelopment Housing Economic Development” website[61] and found none of the information we were attempting to obtain. Additional City websites were investigated for information concerning the WRDA. 24 ∫ Santa Cruz County Grand Jury Final Report 2010-2011 Several reports were found that contain partial information.[61][62][63][64][65] City Staff interviewees informed the Grand Jury there was no simple way to obtain this information. Interviewees were able to name only five or six WRDA completed projects over the nearly thirty-year life of the agency. We were also told that it would take an effort by staff to look through “paper files” to provide us with a list of WRDA projects over the past five years. In addition, some City Staff members were dismissive and contemptuous of the Grand Jury’s attempt to obtain such information. We investigated neighboring county and city governments’ RDA websites to see if the type of information we had requested of the City was available online. We found that the websites of the County of Santa Cruz,[66] the City of Santa Cruz[67] and the City of Morgan Hill[68] all contain excellent and easy-to-understand information that helps the public to understand the effectiveness of their RDAs.

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R6: The City of Watsonville should publish on its website, a current record of activities of the WRDA, including projects proposed, approved, in progress, and completed, along with related revenue, bond obligations and expense information. Manabe-Ow Investigation On October 26, 2010, the City Council passed resolution 174-10[69] approving the Manabe-Ow Specific Plan (MOSP)[70] amid a sea of sign-waving young citizens chanting, “We Need Jobs.”[71] The City considers the Manabe-Ow Project key to its strategy for employment, because it projects over 2,000 new jobs over the next twenty years. The project consists of the development of a 95-acre industrial area in the southern part of the City. “The MOSP represents the culmination of the City's extensive efforts to create a new job base for the community. The City of Watsonville has been actively pursuing a new industrial area to provide new jobs for the residents of the City for the past 15 years.”[72] The Grand Jury supports the City and citizens of Watsonville in their political processes, and does not have an opinion concerning the appropriateness of the Manabe-Ow Business Park project. The Grand Jury is concerned with the completeness and accuracy of background information regarding project financing that was provided by City Staff to the public, the Planning Commission and the City Council, prior to the passage of Resolution 174-10. At the October 26, 2010, City Council Meeting,[71] the Interim Community Development Director presented the Manabe-Ow Staff report.[72] Financing was not discussed at the City of Watsonville ∫ 25 meeting;[69] however, the report included several

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R7: The City Manager should implement a process to ensure transparency, completeness and accuracy in the information provided to the City Council, City Commissions and the Public. City of Watsonville ∫ 27

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R8: The City Council should exercise due diligence and demand that it receives adequate information to make informed decisions. “Financial Management for Elected Officials: Questions to Ask,” published by the Institute for Local Governments is a useful resource.[26]

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R9: The City Council should have a public discussion of the Manabe-Ow project with full disclosure of all funding options.

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📋Delinquent Property Tax Penalty Cancellations: "a Day Late and a Dollar Short"

10 pages 7 findings 8 recommendations

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Findings & Recommendations 7 findings

F1: The Tax Collector’s use of discretion in evaluating the reason to grant tax delinquency penalty cancellations appears inconsistent. Delinquent Property Tax Penalty Cancellations ∫ 45

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F2: The filing system used in the Tax Collector’s Office does not allow tax penalty cancellation documents to be easily located.

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F3: No records are retained of denied requests for tax penalty cancellations.

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F4: The Tax Collector’s Office does not appear to be consistently following the audit

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F5: The Tax Collector’s Office staff has no written procedure to follow for the processing of penalty cancellations.

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F6: Information regarding delinquent tax penalty cancellation processes is not adequately publicized within the County.

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F7: The new computer system has the capability to track details regarding tax penalty cancellations if requested by the Tax Collector or Auditor-Controller.

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Additional Recommendations 8

Not linked to specific findings.

R1: The Tax Collector should create a form for taxpayers requesting the cancellation of tax penalties that includes the recommendations of the internal audit reports, an explanation of the Tax Code,[1][2][3] and the Tax Collector’s response (i.e. granted or denied and reason).

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R2: It should be compulsory for taxpayers to complete the new Waiver Form with supporting documentation when requesting a tax penalty cancellation.

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R3: The Tax Collector should maintain a separate file containing copies of records of all tax penalty cancellation applications, with associated documentation, whether denied or approved.

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R4: The Tax Collector should broadly publicize the delinquent tax penalty cancellation process.

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R5: The County Auditor-Controller should add a review of tax penalty cancellations to the regular audit of the Tax Collector’s Office.

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R6: The Tax Collector should publish a semi-annual report documenting the number of requests and the dollar value of the cancelled tax penalties. The report should include a summary of reasons why tax penalties cancellations were approved and denied.

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R7: The Tax Collector and the Auditor-Controller Office should direct ISD to enable the new IT system to track tax penalty cancellation transactions, both granted and denied.

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R8: The Tax Collector should act in a more transparent manner when applying the State Code. 46 ∫ Santa Cruz County Grand Jury Final Report 2010-2011

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📋Pajaro Valley Unified School District Insurance Vendor Selection: Are There Options?

14 pages 6 findings 4 recommendations

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Findings & Recommendations 6 findings

F1: The Grand Jury found no evidence of any conflict of interest between PVUSD insurance related vendors and PVUSD employees or trustees.

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F2: It appears that the PVUSD Board of Trustees has relied heavily on the administration for information and recommendations on vendor selection and contract approval.

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F3: During the initial interviews, PVUSD Board of Trustees and administrators appeared to be unaware of ongoing litigation concerning Keenan & Associates.

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F4: The services that Keenan & Associates provide PVUSD go beyond an advisory and consultative capacity for health benefits to also include brokering a wide variety of insurance, prescription management, early retirement planning and administration of several JPA’s.

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F5: Even though PVUSD requested proposals from five qualified vendors for Medical, Dental and Vision Consulting Services, and followed California Code and district purchasing policies, the process does not appear to encourage multiple bids.

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F6: The Medical, Dental and Vision Consulting Services contract discloses that Keenan & Associates receives direct compensation from PVUSD and indirect compensation from brokered vendors, which is a conflict in that it diminishes the incentive for Keenan & Associates to always recommend vendors offering PVUSD the best deals.

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Additional Recommendations 4

Not linked to specific findings.

R1: PVUSD Board of Trustees should act more independently of the administration when reviewing and approving significant contracts and vendors.

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R2: PVUSD should include in their purchasing process an Internet background check on prospective vendors, relating to litigation or other issues.

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R3: PVUSD should review their purchasing process and identify possible changes that would increase the number of qualified bids.

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R4: PVUSD should consider the nature of the issues raised in the Fourth Amended Class Action Complaint to determine if they apply to their district. Following that, they should exercise clause 4-D in the Medical, Dental and Vision Consulting Services contract, to review both total direct and indirect compensation received by Keenan & Associates and the potential impact to PVUSD’s overall costs. Pajaro Valley Unified School District Insurance Vendor Selection ∫ 59

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📋Santa Cruz County Correctional Facilities: Are They Effectively Utilized and What Are the Options?

10 pages 7 findings 8 recommendations

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Findings & Recommendations 7 findings

F1: The overcrowded conditions of Santa Cruz County Main Jail will be exacerbated with the transfer of state prisoners back to their originating county.

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F2: Rountree and Blaine facilities are not fully utilized with respect to capacity.

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F3: Security, staff and vehicles are required to transport inmates to the Main Jail for medical/dental needs due to limited medical services at the Rountree Facility.

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F4: The lack of sophisticated dental equipment at the Main Jail requires secure transportation to off-site facilities for those inmates requiring more complex dental work.

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F5: There are no program performance assessment tools, which prevents staff from evaluating the effectiveness of the educational programs.

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F6: Due to a lack of consistent communication from jail personnel, not all inmates are aware of reentry programs offered at the time of their release.

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F7: There are inadequate programs and resources to assist inmates in their reentry into society, such as job skill training, treatment programs, counseling, and transitional housing.

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Additional Recommendations 8

Not linked to specific findings.

R1: Conversion of the Blaine Street Facility into a transitional housing facility or consolidation with another facility should be considered.

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R2: The Sheriff’s Office should perform a cost-benefit analysis of re-opening the housing portion of the minimum security facility at Rountree to reduce overcrowding at the Main Jail.

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R3: The Sheriff’s Office should perform a cost-benefit analysis of providing medical services at Rountree, such as staffing a physician assistant, nurse practitioner or a physician on site, versus the current need for secured transportation costs and associated risks.

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R4: The Sheriff’s Office should perform a cost-benefit analysis of the acquisition and installation of more sophisticated dental equipment for the Main Jail versus the current method of securely transporting inmates off-site for dental care. 70 ∫ Santa Cruz County Grand Jury Final Report 2009-2010

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R5: The Sheriff’s Office should implement a mechanism to track the effectiveness of educational programs within the 2011-12 fiscal year.

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R6: Based upon analysis of the tracking data, the Sheriff's Office should modify their existing educational programs where warranted or consider implementing successful educational programs in use in other jurisdictions, such as Santa Barbara County.

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R7: Inmates should be better informed of post-release resources, such as job skill training, treatment programs, counseling, and transitional housing.

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R8: Santa Cruz County should perform a cost-benefit analysis of the implementation of additional programs and resources to assist inmates in their re-entry into society.

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* 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.