Parks boss steps down over secret $54 million hidden from budget makers

Obviously, we need more transparency in government. Parks boss steps down over secret funds
The state discovered $54 million hidden from budget makers
By Ashly McGlone and Matt Clark
UT-SD
July 20, 2012

The discovery of $54 million stashed away in the state parks department has resulted in the resignation of the agency’s director and the firing of a top assistant.

The state is launching an agencywide audit of the parks department — and is reviewing all 560 special funds in the state budget, which hold upwards of $33.4 billion.

...“I am floored,” said Rick Barclay, chairman of the Friends of Palomar Mountain State Park, a group that spent the last year gathering donations to insure that one of the most popular local state parks in the county would remain open. “If that money really was there and could have been used to keep parks open, then we will all be scratching our heads wondering, why did we go through all that.”

Some 70 parks were threatened with closure this year in anticipation of $22 million in cuts to the department’s $364 million operating budget.

In late June the parks department announced that, at least for the time being, enough money had been found to keep all 70 parks open. Those included the San Pasqual Historic Battlefield museum near the San Diego Zoo Safari Park, and two large state recreation areas in Imperial County: Salton Sea and Picacho on the Colorado River.

Bill Meister, president of the nonprofit Sea and Desert Interpretive Association which has been fighting to keep the Salton Sea State Recreation Area open, said he was shocked by the news.

“An awful lot of people — employees, lovers of the park — have had a lot of sleepless nights not knowing if they were going to have jobs or if the park would close,” he said. “We’ll have to see how this all plays out, but it doesn’t look good.”

State investigators in January began looking into a secret $271,000 vacation cashout program for parks staffers. Officials tapped the department’s new deputy director of administrative services, Aaron Robertson, to examine agency finances. He is credited with finding the hidden funds.

State investigators have determined that nearly $20.4 million, or 39 percent of the money in the State Parks and Recreation Fund, was not disclosed to state budget officials. Nearly $33.5 million, or 20 percent, of the money in the parks’ Off Highway Vehicle Fund was also not reported. Both accounts subsist on revenue from park visitor fees.

The finance department and the attorney general are reviewing whether criminal activity was involved in hiding the assets. Officials said preliminary findings suggest the reporting errors date back at least 12 years.

Ruth Coleman, state parks director for the last eight years, resigned Thursday, even as she said she had no knowledge of the hidden funds.

“I have always taken the public trust to heart and honored it and I am personally appalled to learn that our documents were not accurate,” Coleman wrote in her resignation letter to the governor.

Port execs eat well, fly first class: Port execs eat well, fly first class

Port execs eat well, fly first class
Amid cuts, travel budget is $713,400, up from $416,100 a year ago
Jeff McDonald
March 24, 2012

Chairman Lou Smith flies first class when he travels on port business. Last March, at a top steakhouse in Washington, D.C., he ordered a $49 roast prime rib for dinner and the Port of San Diego picked up the tab.

Commissioners Dan Malcolm, Ann Moore and Robert “Dukie” Valderrama also took first-class flights last year - to Seattle, Washington, D.C., and Costa Rica, respectively. Valderrama visited Hawaii each of the past two years.

Commissioner Bob Nelson traveled first class from San Diego to San Francisco on his way to Europe in May and switched to business class on the ensuing flights to Frankfurt, Germany and Bilbao, Spain.

Nelson, a board member of the San Diego Middle Class Taxpayers Association, billed the port more than $18,400 for the two-week trade mission to Europe, including $308 for international phone calls and text messages and $126 for laundry...

San Diego budget plan: more prosecutors after library and recreation cuts

From Libraries to Lawyers: Shifting Budget Priorities
May 1, 2011
by Liam Dillon
Voice of San Diego

San Diego's library system has eroded over the past six years. Mayor Jerry Sanders freely admits it.

"We've taken them down to a very small percentage of what they used to be," Sanders said at a recent budget forum.

Libraries used to be a greater budget priority. While nearly every city department has seen cuts during a decade of San Diego budget deficits, reductions to libraries have been deeper. Its budget has decreased from $38.7 million in Sanders' first budget in 2007 to $30.1 million under the mayor's proposal for next year. Its percentage of the city's day-to-day operating budget will have g0ne down by more than 1 percent, too.

As libraries have lost, others have gained.

In 2007, the City Attorney's Office received $36.2 million, or $2.5 million less than libraries. Its proposed 2012 allocation will be $42.4 million, or $12 million more than libraries. The percentage the attorney's office receives of the city budget has gone up by 0.3 percent since 2007 as well.

City Attorney Jan Goldsmith argues his department's budget has increased because of costs outside his control, such as paying for a share of the city's growing retirement obligations. Beyond the vagaries of the city budgeting, Sanders, City Council members and even a key library supporter defended the city attorney for keeping the city out of trouble and from racking up outside legal costs.

The downside of cutting libraries is clear. They'll be closed. For attorneys, the effects are less obvious. A smaller legal department could mean lost lawsuits, missed opportunities or bigger bills for outside contracts. But as the mayor and council stress the need to protect public safety and other front line city services in a time of continued budget pressure, they'll have to come to terms with the realization that the city's team of lawyers costs increasingly more than its team of librarians.

The City Attorney's Office files or defends lawsuits involving the city, provides legal advice to the mayor, council and all departments, and prosecutes about 35,000 misdemeanor cases a year. Good lawyers cost money, Goldsmith said in an interview. The fact that they have cost more in the past six years, he said, has little to do with him.

Nearly the entire $4 million hike in his budget this year came from costs associated with rising pension and other retirement obligations, an increase he couldn't do anything about. Further, Goldsmith contended his office took that hit more than others because its costs are almost all personnel.

Goldsmith's office has spent less than its budget the last two years. He's left some positions empty and replaced higher paid jobs with lower level ones. Goldsmith also said he decreased costs for outside attorneys, but those savings primarily appear in other department's budgets.

"Each year we've come in with a plan on how we're going to do our fair share," Goldsmith said.

But for some, it's not fair enough. At a recent community budget forum, Sanders answered a written question about a chart that showed the city attorney's budget larger than the library's.

"Please explain how this is shared pain," the question asked.

Sanders responded that attorneys are expensive, and it costs more to hire outside counsel than do legal work in-house...

Former CCDC board member gets $464,750 for "technical assistance" [??] on plan to end homelessness downtown

Feb 28, 2011
Former CCDC board member gets lucrative consulting contract
Providing "technical assistance" on plan to end homelessness Downtown pays $464,750
By Kelly Davis

Today, the San Diego City Council (sitting as the Redevelopment Agency) will be asked to approve an amendment to a contract with LeSar Development Consultants (LDC) that will pay a total of $464,750 for 15 months of work. The contract, which began in July 2010 and lasts through September 2011, is for "technical assistance" on a plan to end homelessness Downtown within five years. LCD's already been paid $235,000 for work between July and the end of 2010. Today's contract amendment adds $229,750, bringing the total to $464,750.

LDC's president, Jennifer LeSar, sat on the Centre City Development Corp.'s board directors from 2002 to 2009. According to the staff report, LDC was the only respondent to a request for consulting services put out in January 2010. On Jan. 12, 2010, LeSar sent a letter asking the city's Ethics Commission if any conflict-of-interest provisions prohibited her from being paid to provide consulting services to CCDC. She was told it was OK as long as she didn't participate in making the contract.

The contract is being paid with money from CCDC's low- and moderate-income housing fund.

LeSar's hourly rate, according to the scope of services, is $225; Matthew Doherty, who's worked for the San Diego Housing Commission and Corporation for Supportive Housing, has a listed hourly rate of $175. Rachel Ralston, whose resume includes four years as associate editor at the Gay and Lesbian Times before joining LeSar Development in February 2007, is listed at $90 an hour.

LeSar defended the cost and said that her company's per-hour rates are competitive. When I pointed out that Ralston's per-hour rate would come out to $187,200 annually if it were a full-time job, LeSar said I wasn't taking into account the built-in costs of running a business.

LeSar said that LDC's work will create an infrastructure that previously didn't exist for collaboration on homeless services between the San Diego Housing Commission and the county. "We are getting people housing because of this partnership," she said.

Under the contract, LDC was responsible for coordinating last September's "Registry Week," for which 30 teams of volunteers went throughout Downtown to count and survey the street population and create a database that will help get the most vulnerable people into housing, starting with 75 veterans, for whom the Veterans Administration is providing 75 housing vouchers, and 50 mentally ill individuals who will receive Section 8 vouchers and case management services from county mental-health providers.

LDC's role, according to the scope of services, is to coordinate with the San Diego Housing Commission and the county's Health and Human Services Agency to develop a "five-year work plan" for ending homelessness Downtown. The plan includes developing financing strategies, setting annual targets for creating supportive housing Downtown and working on state- and federal-level policy. LDC will also look at the feasibility of holding another Registry Week in 2012, handle PR and community education and outreach and provide recommendations for developing a data system to track and measure the program's progress.

You can download the staff report and supporting documents here.

The Governor's Retort: Cities have an obligation to help fund schools

Click on this link to get the original article with lots of wonderful links: Morning Report: The Governor's Retort
January 25, 2011
Voice of San Diego
by Andrew Donohue

The San Diego leaders fighting Gov. Jerry Brown's plan to kill redevelopment have a simple, digestible argument: Sacramento should get its grubby hands off of our local money and solve its own problems.

Looks like Brown, though, might have just one-upped them.

He's framing the debate in a different way: His plan takes $1 billion away from redevelopment and gives it to the state's ailing schools. Scott Lewis takes that a step further and shows how education was originally supposed to be the very check and balance against redevelopment abuse, but Prop. 13 did away with that.

People like Mayor Jerry Sanders and Councilman Kevin Faulconer have big dreams for San Diego's redevelopment money - things like Convention Center expansions and football stadiums - and are fighting hard against the governor.

"But Brown has now illustrated better than ever before that the money for these dreams comes from education more than anything," Lewis writes. "The state will continue to plow money into education but it's time for downtown and other redevelopment areas to do their part.".

And the Blight Beat Goes On

• Faulconer got six of his colleagues to join him in waving their fists at the governor on Monday night, though they have yet to engage in the last-second redevelopment binges that other cities have enjoyed.

• Our Liam Dillon, meanwhile, is waving his fist right back at the city's downtown redevelopment agency. He's begun our latest public records battle — Blight Watch.

That agency, the Centre City Development Corp., has refused to turn over documents that go to the very core of the agency's continued existence. Agencies have 10 days to turn over documents after a public records request except in extraordinary circumstances. It's been than seven weeks and all we're hearing is that "it's complicated."

We'll be dialing up the pressure this week to ensure that the public records do indeed become public.

• There's another aspect of redevelopment suddenly getting attention now that it's in jeopardy: affordable housing.

One CCDC official recently made the bold claim that his agency had created more affordable housing units than all of Los Angeles' redevelopment areas combined. We fact checked it and here's what we found: A big fat "false."...

Dean Calbreath hopes Arnold Schwarzeneggar will stop tax breaks

Tax changes may be key to plugging budget hole
Dean Calbreath
San Diego Union-Tribune
June 21, 2009

With California on the brink of insolvency, Sen. Dianne Feinstein recently recalled the days when, as mayor of San Francisco, she would venture out into the neighborhoods and ask people what kind of services they wanted.

“Do you want more police?” Feinstein would ask.

The answer would come back, loudly, “Yes.”

“Do you want more firefighters?”

The answer would come back, loudly, “Yes.”

“Do you want to pay for them?”

“And instantly,” Feinstein said, “there would be a booming 'No.' ”

Speaking to a crowd of mostly government workers at Lawrence Livermore National Laboratory late last month, Feinstein said “that's part of the dilemma of (the California budget crisis). And the hard part of it is where the cuts have to come from.”

Feinstein's comments get to the heart of the problem facing Sacramento now. How many schools, libraries, parks and other public services is California willing to do without as we try to close our budget deficit, currently pegged at $24.3 billion?

Gov. Arnold Schwarzenegger's proposal before the Legislature is to rely on cuts alone to fix the budget: $5.5 billion from health and human services, $5.1 billion from education and $1.3 billion from the court and prison systems. The rest of the money would come from one-time sales of state assets; borrowing from cities and counties (an idea that infuriates local officials); furloughs, pay cuts and layoffs of state employees; fee increases and cuts in other services.

Schwarzenegger pledged last week to veto any budget that includes new taxes beyond what he has already proposed, which largely consist of increases to the state sales and income taxes.

“To do another tax increase is irresponsible,” Schwarzenegger said.

But if Schwarzenegger really wants to be responsible about putting out a budget, he should re-examine some of the tax breaks that were inserted into the budget last year to gain the votes needed for a two-thirds passage in the Legislature. And he should reconsider some of the taxes that were abandoned during the budget negotiations.

A conference committee of the Legislature last week proposed doing just that: clipping out the tax breaks and adding back the taxes. Despite Schwarzenegger's veto pledge, he should give the panel's recommendations some consideration:

Oil companies. California is the fourth-largest oil-producing state in the country behind Louisiana, Texas and Alaska. But despite our reputation as a high-tax area, California has never imposed severance taxes for pulling gas or oil out of the ground.

That's a stark contrast to the other oil-and gas-producing states, most of which have double-digit severance taxes. The taxes in conservative, Republican-dominated Alaska are at 25 percent, generating so much money that the state is able to pay residents $2,000 per year as a benefit, besides building a war chest for when oil will no longer be available.

The conference committee proposed putting a 9.9 percent severance tax on oil – a proposal that Schwarzenegger supported last year – which would generate an estimated $830 million in revenue.

Joseph Sparano, who represents oil interests as head of the Western States Petroleum Association in Sacramento, argues against the severance, noting that in California, as opposed to some (but not all) oil-producing states, oil companies pay property taxes for the land where they are drilling.

“If you add the severance tax, oil producers would be paying higher taxes than anywhere else in the country,” he said.

Sparano may have a point. But perhaps we could at least lift severance taxes to the point where we'd be on a par with, say, Texas, Louisiana, New Mexico and Wyoming, which now collect far more on their oil and gas than we do, even after taking property taxes into account.

Corporate tax breaks. During the budget negotiations in February, the Legislature inserted three corporate tax breaks that resulted in a total gap of $2 billion to $2.5 billion

Data from the state Franchise Tax Board show that one of the proposals – to allow companies to choose between two ways of being taxed in the state – would largely benefit the 0.1 percent of companies in California that make more than $1 billion per year. Much of the benefit would go to just nine companies, saving them an average of $33 million a year.

“These massive, permanent tax cuts will exacerbate California's persistent budget troubles, requiring deeper cuts in public services or potentially larger tax revenues from California's families,” said a report of the California Budget Project, a liberal think tank in Sacramento.

Another proposal, which would allow corporations to transfer taxes among related companies, would benefit just 0.03 percent of corporations, with the top six companies saving an average of $23.5 million a year.

Auto license fee. Schwarzenegger's first action as governor was to roll back California's fee on automobile licenses, which put a $4 billion hole in the budget. As the budget problems mounted last year, Schwarzenegger was forced to increase the license fee. And now the Legislature is proposing to raise it an additional $15.

The standard argument against raising taxes is that it would discourage people from buying automobiles. But will an additional $15 fee on an auto license really stop Californians from buying a new car? That's doubtful – but it could generate millions of dollars for the health care, education and other services being cut.

Cigarette taxes. The committee is proposing to increase excise taxes on cigarettes and other tobacco products by $1.50 per pack, nearly tripling the tax on a pack of cigarettes from 87 cents to $2.37. This proposal would increase revenue by an estimated $1 billion next year.

Esmael Adibi, economist at Chapman University in Orange, who happens to be a smoker, complained that such a tax would be “Draconian” and would fall most heavily on the poor.

But if you weigh the value of helping people quit smoking versus laying off teachers and suspending health care for poor children, it would be hard to call it an altogether bad idea. Even if that proposal were chopped down by 90 percent, to 15 cents per pack instead of $1.50, it would still generate $100 million in revenue, which would be enough to keep quite a few teachers on the job.

The bottom line is that to have a balanced budget, there will be pain all around. Assembly Speaker Karen Bass, who supports the tax revisions, said she just wants to make sure “that the shared pain be shared by oil companies and tobacco products, as well.”

San Diego Supervisors give out surplus revenue when there's no surplus

The Supes' Logic

The San Diego Union-Tribune, a local newspaper, has a bit of interesting context about the county's financial situation today. The county is considering laying off employees to cope with declining revenue.

Reporter Craig Gustafson writes:

"In a video message today to the county's 18,000-plus employees, Chief Administrative Officer Walt Ekard warned "actual layoffs will be necessary" to close a budget gap caused by the slumping economy."



At the same time the county is cutting, the supervisors that oversee operations continuing giving out grants to local community groups -- money the supervisors describe as coming from surplus revenue.

Why give out surplus revenue when there's no surplus? The supes say it's because there was a surplus when they approved their budget last year.

They're sticking to their budget when it allows them to give out grants that critics say are used to curry campaign support.

But they're not sticking to their budget when they have to make adjustments to cut services or eliminate staff.

-- ROB DAVIS
Tuesday, January 13 2009-- 12:47 pm