MISSION STATEMENT AD HOC COMMITTEE KERN COUNTY CHILDREN AND FAMILIES COMMISSION
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1 MISSION STATEMENT AD HOC COMMITTEE KERN COUNTY CHILDREN AND FAMILIES COMMISSION An Ad Hoc Committee was appointed by the Foreman of the Kern County Grand Jury to investigate in depth the Kern County Children and Families Commission. The goal of the Committee was to search for answers to questions that had been raised by members of the public and information that the Grand Jury had obtained during an unrelated investigation. The mission of this committee was to suggest possible solutions to problems that were considered to be significant errors or omissions. The following report is the recommendation of this Ad Hoc Committee.
2 KERN COUNTY CHILDREN AND FAMILIES COMMISSION PURPOSE: An Ad Hoc Committee of the Kern County Grand Jury was formed to do an in depth inquiry into the internal operation of the Kern County Children and Families Commission (KCCFC). BACKGROUND: The voters of the State of California passed Proposition 10 into law during the election of November, The law provides for a fifty cent per pack excise tax on every package of cigarettes sold. This brought into effect the creation of the California Children and Families Act of Quoting from the Act, There is hereby created a program in the state for the purposes of promoting, supporting, and improving the early development of children from the prenatal stage to five years of age. These purposes shall be accomplished through the establishment, institution, and coordination of appropriate standards, resources, and integrated and comprehensive programs emphasizing community awareness, education, nurturing, child care, social services, health care, and research. The State Children and Families Commission set up provisions for establishment of County Commissions. Kern County adopted Ordinance # in 1999 creating the Kern County Children and Families Commission. The State Commission mandates County Commissions shall be made up of nine members consisting of: a. A member of the board of supervisors as designated by the board of supervisors b. The public health officer c. The director of the department of human services d. The director of the mental health department e. Five members appointed by the board of supervisors, one (1) nominated by each of the five (5) supervisors Individual counties receive their funding through the trust fund that is administered by the State Commission. The number of births in each individual county calculates the proration of funds. During the first three years of operation KCCFC has received approximately $37,500,000 of which $2,000,000 is earned interest. The first meeting of KCCFC was held May 26, An Executive Director was hired in October, 1999 and funding began in 2000.
3 This Ad Hoc Committee conducted interviews with state and local elected officials, staff of KCCFC, staff of contractors that were granted funds, agencies that work in the same related area, staff of non-funded contractors, and employees of Kern County. Written documentation provided by the interviewees was researched. Also, newspaper reports, editorials, and reader opinion were reviewed to obtain perspective of local public opinion. FINDINGS: Financial procedures are inadequate to prevent waste, fraud, and abuse of funds. Internal controls are not adequate to prevent waste, fraud, or abuse. The accounting firm of Brown, Armstrong, Randall, Reyes, Paulden, & McCown completed financial audit reports for the fiscal years ending June 30, 2000 and June 30, 2001, and advised we noted certain matters involving the internal control over financial reporting and its operation that we consider to be reportable conditions. Reportable conditions involve matters coming to our attention relating to significant deficiencies in the design or operation of the internal control over financial reporting that, in our judgement, could adversely affect the Kern County Children and Families Commission s ability to record, process, summarize and report financial data consistent with the assertions of management in the general purpose financial statements. No written financial procedural manual was developed for the uniqueness of the KCCFC operation, (i.e. quasi-county department). KCCFC has been without a Chief Financial Officer with the exception of a two month period. A part time accountant has been handling all the financial functions of a Chief Financial Officer which seems inadequate for the amount of monies involved. Financial staffing is not adequate to accomplish the checks and balances required to ensure success of the Proposition 10 mission. Contractors are treated differently with respect to financial reporting requirement and technical assistance offered by staff. The Committee investigated the process that contractors were required to complete prior to receiving a Proposition 10 grant. Basically, every contractor goes through the same procedures. However, some contractors are provided extraordinary assistance and sometimes support in business dealings that goes beyond prudent operations. Based upon interviews with the KCCFC staff, the Grand Jury learned that the city of Arvin has been designated as a Priority One by the State of California and that most non-profit organizations are attempting to fund childcare in that city. Other childcare facilities in non-farm areas have yet to be approved for a grant from KCCFC. Based upon interviews with contractors, each stated that all third party invoices had to be attached to their quarterly grant reimbursement request, while at least one contractor was required to forward only a schedule listing expenditures for reimbursement.
4 Chairmanship of the Commission (an appointed member of the Board Of Supervisors) and the appointment of the five non-mandatory Commissioners gives the impression of political favoritism. There is no provision within the County Ordinance to limit the term of the Board of Supervisors Member who serves as Chairman of the Commission. The five Commission Members appointed by the Board of Supervisors appear to have been selected by profession rather than geographical area. Documentation from KCCFC (December 16, 2001) indicates that approximately 66% of all funds are used to backfill existing Kern County Departments and School Districts. The majority of the remaining funds are allocated to non-profit agencies already receiving money from federal and state coffers. It would appear that this is against the original intent of the State Commission for Proposition 10 money. In Section 2 Findings and Declarations under section (m) (1) the Commission states: (m) The California Children and Families First Act of 1998 addresses these issues by facilitating the creation of a seamless system of integrated and comprehensive programs and services, and a funding base for the system with program and financial accountability, they will: (1) Establish community-based programs to provide parental education and family support services relevant to effective childhood development. These services shall include education and skills training in nurturing and in avoidance of tobacco, drugs, and alcohol during pregnancy. Emphasis will be on services not provided by existing programs and on the consolidation of existing programs and new services provided pursuant to this act into an integrated system from the consumer s perspective. In giving thousands and thousands of Proposition 10 dollars to county departments, school districts, and non-profit agencies already in place, there is a definite belief and concern that the Kern County Children and Families Commission is going against the State Commission's original intent. At the very least it takes away monies that could be used for new programs to help the 0-5 infant population. Impression is that the KCCFC is being used as a money funnel, not a new entity of its own making. It is not to say that these current agencies fail to provide services and could use the funds. The question must be asked, why not eliminate the middle man (KCCFC) and issue the funds directly from the State Commission? The majority of all Commissioners sit on other boards who receive grants as well as some Commissioner's departments are funded with Proposition 10 monies. The appearance of conflict of interest is overwhelming and actual conflicts make the proper allocation of funds difficult.
5 Research and investigation into the records of KCCFC indicates the majority of all funding is targeted at specific areas of the 0-5 infant population. The California Children and Families Act seeks to help provide, on a communityby-community basis, all children prenatal to five years of age with a comprehensive integrated system of early childhood development services, (Page v, Strategic Plan for Early Childhood Development in Kern County). In identifying the specific needs of each community in Kern County, it appears the KCCFC concentrated on the needs of the Hispanic population, the farm worker, and those with low income; children who are already receiving considerable attention under state and federal program funding. COMMENTS: It is not the intent of this report to detract from the accomplishments of KCCFC. This Committee understands that Proposition 10 is a new program and has taken this fact into consideration. However, the Committee is pointing out the lack of balance in the current funding patterns. The Grand Jury is also concerned about overlapping funding and the possible waste of funds. RECOMMENDATIONS: KCCFC should enhance internal controls by immediately hiring a qualified Chief Financial Officer and increase the staffing of the Financial Department to develop accounting and auditing procedures to protect Proposition 10 assets against waste, fraud, and abuse of funds. This should include proper record keeping and control, financial reconciliation, continuous physical monitoring, and audits of grantors' sites. KCCFC should continue to retain the Kern County Auditor as their fiscal payment agent. The Auditor s Office has specific policies and procedures that will protect KCCFC and their monies. KCCFC should continue to retain the Kern County Counsel's Office as their legal counsel. All contractors should receive the same technical assistance from KCCFC staff and be required to process reimbursement requests under the same procedures. The creation of Proposition 10 was for the benefit of all children in the prenatal stage to five years of age and not just for farm workers and low-income children and families, thus, all proposed projects should be evaluated based upon that mandate. Rotate the Chairmanship of the Commission at least every two years to eliminate the appearance of impropriety when contractors are awarded grants and improvements made within the Chairman s District. Board of Supervisors appointments should be made by geographical area; the representation should be comparable to the makeup of Kern Council of Governments (Kern COG).
6 Concentrate on funding and help develop new programs that are more in compliance with the intent of Proposition 10. The Commissioners should abstain from voting on any grants that directly benefit either their own agency or an agency on which they sit on that board of directors. This Committee believes KCCFC needs to develop programs that will benefit all the 0-5 infant population in Kern County; for example, a program that would provide physicals for children entering kindergarten, plus updating immunizations that are needed for school entrance. Proposition 10 also was written to target smoking; KCCFC shows very little effort made toward this goal. RESPONSE REQUIRED: WITHIN 90 DAYS TO PRESIDING JUDGE KERN COUNTY SUPERIOR COURT 1415 TRUXTUN AVENUE BAKERSFIELD, CA 93301
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