As Audit Expenses Continue to Escalate
Who Is Going to Pay?
In case it’s been lost in the Modoc County Board of Supervisors’ quick shuffle of business when it comes to who will ultimately pay for the escalating costs of the state-ordered audit, there remains one potential consolation.
Litigation.
As reported Nov. 9, 2009 on this blog, the cost of the audit -- which has increased from $190,000 to a current $375,000 -- may fall on TCA Partners of Fresno, whose previous audit of the county was virtually overturned by the State Controller’s Office.
The current county budget shows the Board of Supervisors with expenses of $438, 216, but only a portion of that comes from the audit increases, according to Darcy Locken, assistant chief administrative officer.
Locken said part of the costs went to the Board of Supervisors’ budget and part was budgeted as a reserve line item, so that costs that exceeded what was applied to the board’s budget could be drawn out of the reserves as needed.
Richard Arrow, Modoc County chief financial officer, said on Nov. 9 that TCA Partners expressed a willingness to pay for the new audit if its insurance covers the costs.
Arrow recently confirmed that if TCA’s insurance does not cover the costs of the audit, Modoc County will have to go to court to recover its $375,000 outlay.
“It’s a matter of determining the amount of damages,” Arrow explained. “Once we have the costs, County Counsel John Kenny will have to file a claim. We will need expert witnesses, but it won’t be this year.”
The principle reason for the increase in audit costs is that Modoc County has had to upgrade its antiquated books and procedures to such an extent that the auditor, VTD of Rancho Cucamonga, has had to devote more time working with the county than was anticipated.
In the meantime, the county must bear the costs of the audit even though the state, in its 129-page report, said TCA Partners failed to meet numerous criteria in examining the county’s financial records.
The new audit was ordered by the state when it was revealed early last summer that the Board of Supervisors, elected and appointed officials, illegally misappropriated an estimated $20 million from the county’s treasury.
The new audit is anticipated to provide supportive financial information that will aide the county in seeking a long-term loan of $12.7 million to restore the treasury.
Thursday, March 25, 2010
Wednesday, March 24, 2010
Cutback in Tax Revenue Payments
Meets with Opposition from Schools
A plan by Modoc County to reduce the amount of tax revenues to be paid in April to school districts has been stalled, but it is not clear just how much the schools will be receiving from the cash-strapped county coffers.
Typically, the schools were expecting a disbursement of 50 percent last December, which was actually paid out, 40 percent in April and 10 percent in June.
Late last week a cash flow spread sheet released by County Treasurer Cheryl Knoch revealed that $608,329 was scheduled to be paid out, which amounted to approximately 14 percent of what the schools expected to receive.
It was not clear if the $608,329 was to be paid out only to the schools or to be divided among schools and special districts. Also, it’s not known how the revised disbursement of tax revenues will affect the City of Alturas and special districts such as the Surprise Valley Health Care District.
The decrease in payments, which caught school officials by surprise, was not disclosed until the Modoc Independent News inquired about the reasons for the sudden turn around in cash flow from a negative balance to a positive one.
When Gary Jones, county superintendent of education, learned of the proposed reduction a meeting of school and county officials was hastily called for yesterday (March 24) morning.
In attendance, in addition to Jones, were Treasurer Cheryl Knoch, Auditor Alice Marrs, Asst. Auditor Pam Randall, CFO Richard Arrow, Alan Hopkins, president of the Modoc Joint Unified School District; Lane Bates, MJUSD superintendent; and Don Demsher, Surprise Valley Joint Unified School District superintendent.
School officials agreed to a compromise after Knoch, Marrs and Arrow submitted three scenarios of varying percentages. The final breakdown accepted by the schools will be 30 percent in April, 10 percent in May and 10 percent in June.
Jones, who described the meeting as cordial, said he has received the revised cash flow statements and that the county “will look at what percentage they can pay out so their negative balance is not hugely negative.”
He was more direct in his reactions to the county’s excluding the schools when it was deciding to make the cutbacks.
“When there is a discussion concerning schools, we need to be present,” Jones said. “There is a bad appearance when we’re not involved when the subject concerns school money. They apologized for not giving us information in a timely manner. They want to work with us in an open communication process. It’s necessary for the health of the county.
“We have expertise in our local schools,” Jones continued, “and we should not be sidelined. We should be partners that are helpful.”
Stressing the importance of the schools receiving their full allocation, Bates, appearing before the Modoc County Board of Supervisors on Tuesday (March 23) said his district has an $800,000 payroll to meet in June and if the county makes drastic cuts his district will have to seek a loan from the county schools office.
Hopkins told the board “the property tax disbursement has gotten out of hand.”
Questions posed by the Modoc Independent News to Knoch, Arrow and Marrs were not answered at deadline Wednesday (March 24) evening.
-- Ray A. March
Meets with Opposition from Schools
A plan by Modoc County to reduce the amount of tax revenues to be paid in April to school districts has been stalled, but it is not clear just how much the schools will be receiving from the cash-strapped county coffers.
Typically, the schools were expecting a disbursement of 50 percent last December, which was actually paid out, 40 percent in April and 10 percent in June.
Late last week a cash flow spread sheet released by County Treasurer Cheryl Knoch revealed that $608,329 was scheduled to be paid out, which amounted to approximately 14 percent of what the schools expected to receive.
It was not clear if the $608,329 was to be paid out only to the schools or to be divided among schools and special districts. Also, it’s not known how the revised disbursement of tax revenues will affect the City of Alturas and special districts such as the Surprise Valley Health Care District.
The decrease in payments, which caught school officials by surprise, was not disclosed until the Modoc Independent News inquired about the reasons for the sudden turn around in cash flow from a negative balance to a positive one.
When Gary Jones, county superintendent of education, learned of the proposed reduction a meeting of school and county officials was hastily called for yesterday (March 24) morning.
In attendance, in addition to Jones, were Treasurer Cheryl Knoch, Auditor Alice Marrs, Asst. Auditor Pam Randall, CFO Richard Arrow, Alan Hopkins, president of the Modoc Joint Unified School District; Lane Bates, MJUSD superintendent; and Don Demsher, Surprise Valley Joint Unified School District superintendent.
School officials agreed to a compromise after Knoch, Marrs and Arrow submitted three scenarios of varying percentages. The final breakdown accepted by the schools will be 30 percent in April, 10 percent in May and 10 percent in June.
Jones, who described the meeting as cordial, said he has received the revised cash flow statements and that the county “will look at what percentage they can pay out so their negative balance is not hugely negative.”
He was more direct in his reactions to the county’s excluding the schools when it was deciding to make the cutbacks.
“When there is a discussion concerning schools, we need to be present,” Jones said. “There is a bad appearance when we’re not involved when the subject concerns school money. They apologized for not giving us information in a timely manner. They want to work with us in an open communication process. It’s necessary for the health of the county.
“We have expertise in our local schools,” Jones continued, “and we should not be sidelined. We should be partners that are helpful.”
Stressing the importance of the schools receiving their full allocation, Bates, appearing before the Modoc County Board of Supervisors on Tuesday (March 23) said his district has an $800,000 payroll to meet in June and if the county makes drastic cuts his district will have to seek a loan from the county schools office.
Hopkins told the board “the property tax disbursement has gotten out of hand.”
Questions posed by the Modoc Independent News to Knoch, Arrow and Marrs were not answered at deadline Wednesday (March 24) evening.
-- Ray A. March
Tuesday, March 23, 2010
Brown Act Violation?
Macsay Criticizes Crabtree’s Handling of BOS
It’s been revealed that Dan Macsay, chair of the Modoc County Board of Supervisors, has criticized Vice Chair Shorty Crabtree’s handling of a recent board meeting, saying Crabtree was in potential violation of the Brown Act.
The criticism was in the form of an e-mail from Macsay to Supervisor Jeff Bullock, who confirmed he received Macsay’s message. It is not known if Macsay’s e-mail was copied to other board members.
Macsay readily confirmed he had sent the e-mail to Bullock when asked during a recess at yesterday’s (March 23) board meeting, and admitted he had not talked first with Crabtree about his concerns over the Brown Act.
Asked to be more specific about his criticism of Crabtree’s chairing the March 9 meeting in Macsay’s absence, Macsay would only say that Crabtree let agenda discussions go beyond their scope of intent which opened the board to a potential Brown Act violation because the public was not given advance notice covering any expanded topics not on the agenda.
“What was I doing wrong?” Crabtree asked the Modoc Independent News when told for the first time of Macsay’s criticism that Crabtree potentially violated the Brown Act.
“I don’t think he’s right,” Crabtree continued, “but if he thinks so…” and he paused before adding, “freedom of speech comes into this, but I knew he would find something wrong. I did the best I could. It was the first time I chaired the board’s meeting. I don’t think he has grounds for complaint. Citizens can say any damn thing they want to.”
Macsay told the Modoc Independent News that there are very stringent guidelines enforced by the Brown Act which must be followed at board meetings and admitted he should have brought the matter up at open session or that County Counsel John Kenny should have made a public comment to the board.
-- Ray A. March
Editor's Note: A concerned reader sent us this information regarding compensation of state elected officials, which we're sharing with you.
California Citizens Compensation Commission
Recent Action- On June 30, 2009, the Commission met and voted to reduce by 18 percent the State's contributions for health and other insurance benefits, and the legislators' auto allowance and per diem.
- On May 20, 2009, the Commission met and voted to decrease elected officials' salaries 18 percent effective December 7, 2009.
- On April 29, 2009, the Commission met but didn't pass a resolution; the Commission decided to meet again before June 30 to vote on salary and benefit changes, if any.
| Elected Officials | Effective 12/9/2009 | |
|---|---|---|
| Governor | $212,179 | $173,987 |
| Lieutenant Governor | $159,134 | $130,490 |
| Attorney General | $184,301 | $151,127 |
| Secretary of State | $159,134 | $130,490 |
| Controller | $169,743 | $139,189 |
| Treasurer | $169,743 | $139,189 |
| Superintendent of Public Instruction | $184,301 | $151,127 |
| Insurance Commissioner | $169,743 | $139,189 |
| Members, Board of Equalization | $159,134 | $130,490 |
| Speaker of the Assembly | $133,639 | $109,584 |
| President Pro Tem of the Senate | $133,639 | $109,584 |
| Minority Floor Leader | $133,639 | $109,584 |
| Majority Floor Leader | $124,923 | $102,437 |
| Second Ranking Minority Leader | $124,923 | $102,437 |
| All Other Legislators | $116,208 | $95,291 |
BOS Sets Date With “Monday Group”
The “Monday Group” made its first move in its role as an ad hoc oversight committee on Tuesday (March 23) when it presented a 10-point plan to the Modoc County Board of Supervisors and asked for an early date to discuss it.
If successful, and with cooperation of the Board of Supervisors, the “Monday Group” committee will for the first time attempt to achieve accountability from the county for the illegal misappropriation of an estimated $20 million from the treasury, among other goals it has set.
The board agreed to a March 30 open-to-the-public workshop session which will be held at 9 a.m. at the Federated Church in Alturas, but did not set a formal meeting date for a follow-up report.
That report and further public discussion is to be an agenda item at either the board’s regular April 13 meeting or on April 20.
“We are pushing for April 13,“ Don Demsher told the Modoc Independent News, “because all this is time sensitive.“
The 10 points to be discussed at the March 30 meeting are:
1. Discussion of the role of Richard Arrow, newly appointed county chief financial officer, and direction from the board to have Arrow cooperate with the committee and compile needed data.
2. Identify cash flow projections until December 31, 2010.
3. Identify cost reductions and implementation timing.
4. Identify entities whose restricted funds have been used, quantifying dollar amounts used, and fund sources.
5. Response to State Controller’s letter of July 6, 2009 regarding impermissible use of funds and request for a repayment plan.
6. Study operations of Modoc Medical Center and how revenues and costs can be stabilized, quantified. i.e. county operation vs. district operation or other options.
7. Delay of property tax apportionment to school districts,
.
8. The Board of Supervisors directs CAO, assistant CAO and department heads to provide information and support to the committee.
9. Discuss/consider options for financing to replace deficit.
10. Discuss/consider options for short-term (cash flow) financing.
The “Monday Group” made its first move in its role as an ad hoc oversight committee on Tuesday (March 23) when it presented a 10-point plan to the Modoc County Board of Supervisors and asked for an early date to discuss it.
If successful, and with cooperation of the Board of Supervisors, the “Monday Group” committee will for the first time attempt to achieve accountability from the county for the illegal misappropriation of an estimated $20 million from the treasury, among other goals it has set.
The board agreed to a March 30 open-to-the-public workshop session which will be held at 9 a.m. at the Federated Church in Alturas, but did not set a formal meeting date for a follow-up report.
That report and further public discussion is to be an agenda item at either the board’s regular April 13 meeting or on April 20.
“We are pushing for April 13,“ Don Demsher told the Modoc Independent News, “because all this is time sensitive.“
The 10 points to be discussed at the March 30 meeting are:
1. Discussion of the role of Richard Arrow, newly appointed county chief financial officer, and direction from the board to have Arrow cooperate with the committee and compile needed data.
2. Identify cash flow projections until December 31, 2010.
3. Identify cost reductions and implementation timing.
4. Identify entities whose restricted funds have been used, quantifying dollar amounts used, and fund sources.
5. Response to State Controller’s letter of July 6, 2009 regarding impermissible use of funds and request for a repayment plan.
6. Study operations of Modoc Medical Center and how revenues and costs can be stabilized, quantified. i.e. county operation vs. district operation or other options.
7. Delay of property tax apportionment to school districts,
.
8. The Board of Supervisors directs CAO, assistant CAO and department heads to provide information and support to the committee.
9. Discuss/consider options for financing to replace deficit.
10. Discuss/consider options for short-term (cash flow) financing.
Monday, March 22, 2010
ICS Team -- An Analysis
On Feb. 1 we reported in this space that the Incident Command System team the Modoc County Board of Supervisors deemed a necessary part of its public relations campaign was in shambles.
No one chose to publicly contradict or confirm our report. Not CAO Rick Rudometkin. Not Kelly Crosby, ICS team public information officer. Not Dan Macsay, chair of the board.
When we reported the ICS team -- based on reliable sources -- was apparently disintegrating, we revealed that its “members are in disagreement, some are reluctant to embrace any ‘out-of-the-box’ ideas and overall they have apparently been unable to adequately address the financial issues they have been assigned.”
Why is any of this important as the board of supervisors continues in its efforts to replace the money it illegally took from the treasury? Because this is another example of the board’s dysfunctional management practices.
Put to proper use, an ICS team is an integral part of an actual emergency such as fire, flood or earthquake. Members actually train for the jobs.
The Board of Supervisors, on the other hand, decided there was no “state of emergency” and rejected that possibility back in November. Then on Jan. 12 Rudometkin told the Board of Supervisors that he intended to disband, or re-form, the team but did not say why or when.
We continued to look for public information dispatches disclosing the county’s progress in handling its financial crisis. After all, this was meant to be the board’s attempt at “going public.” At first there were broad statements from the ICS team, but nothing specific. Those ended, at least for the time being, on Jan. 29.
There has been nothing since that date.
We recently asked Rudometkin if he would give us an official statement on the status of the ICS team. It took four requests from us and about a week for Rudometkin to respond.
“Still in place, no change at this time,” Rudometkin replied on March 22nd by e-mail.
The importance of the ICS team can not be understated, if it is used appropriately. Unfortunately, its formation is in the category of other board actions designed to impress the state and private lenders that the supervisors are acting responsibly.
Actions like pushing former CAO Mark Charlton out the door after he exposed the board for its financial transgressions, and actions like naming Rudometkin chief administrative officer when he apparently does not possess the credentials to follow up on his mandate to lead the county out of its financial morass.
We leave it at that.
--Ray A. March
No one chose to publicly contradict or confirm our report. Not CAO Rick Rudometkin. Not Kelly Crosby, ICS team public information officer. Not Dan Macsay, chair of the board.
When we reported the ICS team -- based on reliable sources -- was apparently disintegrating, we revealed that its “members are in disagreement, some are reluctant to embrace any ‘out-of-the-box’ ideas and overall they have apparently been unable to adequately address the financial issues they have been assigned.”
Why is any of this important as the board of supervisors continues in its efforts to replace the money it illegally took from the treasury? Because this is another example of the board’s dysfunctional management practices.
Put to proper use, an ICS team is an integral part of an actual emergency such as fire, flood or earthquake. Members actually train for the jobs.
The Board of Supervisors, on the other hand, decided there was no “state of emergency” and rejected that possibility back in November. Then on Jan. 12 Rudometkin told the Board of Supervisors that he intended to disband, or re-form, the team but did not say why or when.
We continued to look for public information dispatches disclosing the county’s progress in handling its financial crisis. After all, this was meant to be the board’s attempt at “going public.” At first there were broad statements from the ICS team, but nothing specific. Those ended, at least for the time being, on Jan. 29.
There has been nothing since that date.
We recently asked Rudometkin if he would give us an official statement on the status of the ICS team. It took four requests from us and about a week for Rudometkin to respond.
“Still in place, no change at this time,” Rudometkin replied on March 22nd by e-mail.
The importance of the ICS team can not be understated, if it is used appropriately. Unfortunately, its formation is in the category of other board actions designed to impress the state and private lenders that the supervisors are acting responsibly.
Actions like pushing former CAO Mark Charlton out the door after he exposed the board for its financial transgressions, and actions like naming Rudometkin chief administrative officer when he apparently does not possess the credentials to follow up on his mandate to lead the county out of its financial morass.
We leave it at that.
--Ray A. March
Sunday, March 21, 2010
Editorial
Questions To Ask Rudometkin
At His Next Personnel Session
With some regularity, Rick Rudometkin’s name pops up on the Modoc County Board of Supervisors’ agenda under “Closed Session.” It’s there again on Tuesday, March 23.
We could suppose that frequent personnel sessions with the county’s chief administrative officer are only a routine matter where they pat each other on the back and tell themselves what a good job they’re all doing getting the county -- and its taxpayers -- out of a deep, deep financial hole.
But somehow we doubt that.
For starters this next closed session is a good time to check out Rudometkin's credentials qualifying him for the top executive job in the county. The board never did that when they promoted him.
While the supervisors are at it, they could ask Rudometkin what happened to the ICS team everyone desperately needed back in November, when at the time they made him not only Interim CAO, but also put him in charge of the ICS system.
They could ask him about all those "hard questions" he said he was going to ask them. And, while they’re at it they might get his definition of “transparency.”
Also, before we forget, the supervisors could ask him if he has Shorty Crabtree’s telephone number. Shorty would like to hear from him.
-- Ray A. March
At His Next Personnel Session
With some regularity, Rick Rudometkin’s name pops up on the Modoc County Board of Supervisors’ agenda under “Closed Session.” It’s there again on Tuesday, March 23.
We could suppose that frequent personnel sessions with the county’s chief administrative officer are only a routine matter where they pat each other on the back and tell themselves what a good job they’re all doing getting the county -- and its taxpayers -- out of a deep, deep financial hole.
But somehow we doubt that.
For starters this next closed session is a good time to check out Rudometkin's credentials qualifying him for the top executive job in the county. The board never did that when they promoted him.
While the supervisors are at it, they could ask Rudometkin what happened to the ICS team everyone desperately needed back in November, when at the time they made him not only Interim CAO, but also put him in charge of the ICS system.
They could ask him about all those "hard questions" he said he was going to ask them. And, while they’re at it they might get his definition of “transparency.”
Also, before we forget, the supervisors could ask him if he has Shorty Crabtree’s telephone number. Shorty would like to hear from him.
-- Ray A. March
Subscribe to:
Posts (Atom)