Matters From Don Parker.

Last Tuesday, at Matters From The Audience, Brea Deputy City Treasurer Don Parker dropped a bombshell on Council and staff. There seems to have been yet another case of “less than best practices” on the part of staff and there could be a cost to approaching a million bucks.

Emerging from a nine year series of amendments (six actually) to a professional services agreement with Ninyo & Moore for their work on the Rails-To-Trails project that increased their cost from $24,500 to $1,034,777.30 – 42.3X the original estimate.

Don’s Report To Council.

I said I would review the contracting done when the City auditors questioned costs and I am here to comment on that. As background, the contracting for soil testing and services on the Tracks project was questioned because the file(s) “could not be located” but I looked at the contracting.

In 2010, an agreement was approved with Converse Consultants for a soil remediation plan. The report indicated their bid was $46,100 and the high bid of Ninyo & Moore was $55,200. A consent item approved their contract for $55,200. No I have not misspoken, the low bidder was given the high bid price with no explanation as to why. In my 40 plus years of municipal auditing and accounting I have never seen this done and no one questioned it. What was done with this difference is unknown.

(Burying items like this on the Consent Calendar has become de rigueur for city business whenever they prefer to keep the public in the dark. More on this later.)

In 2012, Ninyo & Moore, prior high bid, proposed $19,500 for a soil remediation plan and a contract was prepared for $24,500. Again I have not misspoken as this was $5,000 more than their proposal with no explanation. Since this was under $25,000 “policy limit” our prior City Manager approved it. Where that $5,000 went is unknown.

(Hot button number two – City Manager purchasing authority. Are you serious? It was purported to be $25,000 back then (2012 and prior) but no one could establish when or even if this was approved by Council!

Today the rumor has doubled to $50,000, with no indication as to how many times a year the City Manager can exercise this authority. I’ve filed a CPRA request to document details of this. We’ll see what the City Clerk can dig up.)

In 2013 through 2015, the first through third amendments were done and approved on consent for $200,000, $70,000 and $40,000, respectively. Supposedly because original estimates of soil depth, etc. were in error.

(Note: As a part of soil remediation work, a separate contractor is required to provide oversight to ensure that the cleanup meets the standards of both the City and the local regulatory agency, which is the Orange County Health Care Agency.

So, this exponentially escalating cost is only part of the expense. This is for analysis and oversight. Another contractor had to dig up the arsenic laced soil and properly dispose of it. When I mentioned this to a friend they chuckled, “Maybe ‘the roads are paved with gold’ didn’t come from Dick Whittington and his Cat after all.”)

In 2016, the fourth amendment was approved on consent for $60,700 again for additional soil testing services. However, now in the staff report it was stated that Council approved the original agreement with Ninyo & Moore in 2012. As I have indicated, and as confirmed by your City Clerk, the original agreement in 2012 was never approved by Council. This misinformation started after our current City Manager took his position and I believe this was added to justify using this vendor

In 2017, the fifth and sixth amendments were approved by consent for $218,144.30 and $421,433, respectively for segments 2, 3 and 4 of the project. Each of these segments should have been bid separately. Instead, they were just given to the existing firm. Repeatedly in these staff reports it was stated that Council approved the 2012 original agreement which was a lie.

(Not unlike the lie that the Paramedic Tax was for the sole purpose of developing and maintaining a mobile intensive care paramedic service. Now we know it was just another honey pot. Anyone but me starting to see a pattern here?)

In summary, we have contracts awarded for amounts in excess of the proposals received with no explanations of why or where those monies went. A contract which started at $24,500, approved by our prior City Manager, which was increased to $1,034,777.30 with no additional bids to protect the public’s money. Staff reports repeatedly misled readers into thinking the original agreement was Council approved but it never was. Community Development staff, management and our prior and current City Managers cut corners, prepared false staff reports and possibly enriched themselves or others to the detriment of our City.

Our auditors did not comment on these situations so we are lucky they did not follow through. However, it is possible we still could have to repay these monies. In any event these situations occurred and they do time and time again. When is Council going to say enough is enough and start holding City management accountable and protecting our monies? I guess just approving false staff reports is easier.

D.P.

So, where do we go with this? How about starting to hold Council accountable to do what we elected them to do. I think the popular term today is ‘community driven governance’ – something I’ve been advocating for many years.

So, What Have We Learned?

We’ve learned that our Records Retention Schedule allows critical records and important public documents to be routinely dumped every 90 days. Stuck in the sixties, the City Clerk has no control over electronic communications… the IT department has their servers set on auto-purge.

We’ve learned that a deceptive plan to do an end run around Prop 13 gave us the Paramedic Tax. Millions of dollars, almost half of what has been collected since 1978, has been diverted to pay for development debt and other obligations not even remotely related to the paramedic services Brea voters believed they were creating.

We’ve learned that, for decades, the Consent Calendar has been used as a bureaucratic black hole to hide everything Council and staff wanted to keep from public view. Thankfully, in recent years, several Breans have become quite talented at spotting the big fat checks disguised as routine expenses.

We’ve learned that the City Manager has a huge treasure chest he can dip into at will without Council’s knowledge, oversight or approval… and we’re about to find out if it’s even legal.

We discovered that our appointed Cal Domestic Board Members unanimously approved combined stipends from Cal Domestic and their for profit subsidiary Cadway totaling a potential $24,000 a year income. That’s 3 or 4 times Council’s base stipend.

Council has been requested to require these public servants to file the annual CA Form 700 Statement of Economic Interests and Council is balking. Unless they call a special meeting, which they won’t, they’ll miss the deadline and face a formal complaint being filed with the FPPC.

 

Treasurer Selection Not An Easy Choice.

Study SessionEveryone, Council, staff and followers of local government, were surprised when eleven Breans applied for the City Treasurer position vacated when Glenn Parker was reelected to Council. Most had expected no more than three or four candidates to emerge.

In a meeting that began on Friday, January 23 and was continued to Tuesday, January 27, Council managed the arduous task of interviewing all applicants and then pressed on to reach a consensus selecting a new City Treasurer. For those interested, the meeting’s agenda and all applications are available on the city’s website.

Applicants, in order of interview were Don Parker, Michael Becher, Marlan Merhab, Roy Moore, Jim Grosse, Gary Terrazas, Joseph Galligan, Bill Christensen, Phil Anton, Gill Realon and Kenneth Palmer. An interesting note, as the interview conflicted with a long planned holiday, Council agreed to allow Bill Christensen to teleconference his interview from Angkor Wat, Cambodia.

Thinning out the list.

If you’ve looked over the City Treasurer applications, you’ll have some idea of just how tough job Council faced. Every applicant was well qualified with decades of executive level experience. Council’s first step was to agree upon a tight set of criteria, opting for someone with a strength in managing major investment portfolios over CPAs with mostly P&L and budget management background. As Brea has an average of $50 million at stake in the investment pool at any one time, I have to agree.

This focus made it possible to move five names out of contention. Mayor Simonoff then asked for each Council member to list their top three choices. All but Glenn Parker were able to do so. Glenn seemed to be advocating for a single candidate but later acquiesced and added one more name. Pressing on, the lists merged to provide a basic ranking and animated discussion followed.

I must say that, as I observed this process for a little over seven hours, I was elated to see Council engaged in a friendly, respectful, open and productive way. I hadn’t seen that sort of behavior with previous Councils going back through several regimes.

There were a couple of delicate moments when signs of personal favoritism and possible political ties slipped into the dialog but Mayor Simonoff and the other Council members skillfully defused the situations and productive discussion moved on.

The finalists emerged.

After an hour or so, Gill Realon, Bill Christensen and Phil Anton made the short list. Discussion continued comparing the merits of each to the objectives set at the beginning of the meeting. TreasurerUltimately, after another half hour, Mayor Pro Tem Marick moved to approve Bill Christensen as the Treasurer and the motion was quickly seconded by Council member Vargas.

A voice vote was taken and Council voted unanimously to appoint Bill Christensen. Mayor Simonoff’s suggestion that the City Clerk contact the U.S. Ambassador to Cambodia to inform Bill Christensen of Council’s decision was met with a chuckle and the meeting was adjourned.

A closing thought.

One of the applicant’s suggested, given the depth of the applicant’s talent pool and their willingness to serve, that Council put more of them to work by creating a citizen’s advisory or oversight committee to help keep an eye on city finances.

Great idea! First assignments should be evaluating whether restructuring of Brea’s Fire Department, twice, has produced the savings promised by the City Manager… conducting an audit of the solar energy program to establish whether or not it is paying for itself as promised and finally, developing the framework for a “Get Out Of Debt” plan that would eradicate Brea’s unfunded pension and medical liabilities.

Other views in the news?

Doubtful, the only non-city person in the room besides myself was the pool boy’s pet wannabe blogger, Greg Diamond. Greg DiamondNo one from any reputable newspaper felt it worth covering I guess.

Arriving late, well over two hours after the meeting began, Diamond berated the City Clerk for allowing Council to move expeditiously through the interviews (as if that were her job) and then set up his tripod and camera which he fiddled with periodically throughout what was left of the evening.

While I suppose he captured most of the final three or four interviews and perhaps a bit of the Council discussion that followed, his constant preoccupation with his phone and incessant texting took his attention off of the meeting. He spent 90% of his time focused upon posting his signature lengthy rants to whatever blog he was bombarding.

Anyone who has watched a Council meeting on TV and attended the meeting live will tell you there is no comparison. You take in so much more by being in the room and paying attention than what you could possibly get watching disjointed video clips captured on a static camera or two.

Greg DiamondWatching video clips instead of actually paying attention so severely hampers Diamond’s take on the meeting I question how faithful to the truth his reporting could possibly be.

I’m sure his longwinded poison pen version will be laced with invectives, condemnation and unfounded criticisms that are nothing more than malicious attacks… instead of providing credible journalism or making any honorable effort to inform citizens or positively impact public policy.

He seems to be working out his own self esteem issues at the expense of others. This would explain why he and the pool boy are such tight buddies, they share so much in common… starting with delusions of grandeur and acute narcissism.

Legal Tactics Called Bait And Switch.

The 10/27/2013 Orange County Register, under “Our Town – Brea,” published the following: (Reprinted here because many of you object to the OCR’s paywall which blocks you from reading articles via links shared here and elsewhere.)

Amicus brief: Ballotpedia, a non-profit group that disseminates information on elections, and California Aware, which tries to improve agencies’ adherence to laws, have filed an amicus brief supporting ex-Councilman Steven Vargas in a court case against Brea over the validity of City Council authored rebuttals to 2012’s Measures T and U.”

What is an Amicus Brief?

Lady-JusticeAmicus Curiae, “… a phrase that literally means “friend of the court” — someone who is not a party to the litigation, but who believes that the court’s decision may affect its interest.” – William H. Rehnquist.

Ballotpedia and Californians Aware believe they are effected by the court’s decision and have filed an Amicus Brief, formal arguments with the court.  The decision on whether to admit the information lies at the discretion of the court.

I believe the brief presents a strong defense of the claims made in the litigation by Vargas. Clearly, the City ignored the letter informing them of their error and chose instead to disregard the law and bear the costs of the litigation that followed.  The whole matter could have been handled, without heavy legal fees, simply by adhering to the law when their error was brought to their attention.

Amicus Brief’s Conclusion.

You can read/download the full Amicus Brief here, or be satisfied by reading it’s concluding content.

“The fact that one of the present measures involved caps to the bait and switchers’ own salaries should raise an eyebrow of skepticism regarding any actions not completely compliant with the Elections Code. The City of Brea whether honest or nefarious in its mistake should not be permitted to swap signatories after the review and challenge period passed.

This Court must ensure that all entities play by the rules as clearly laid out in the Elections Code.  Section 9283 is crystal clear that the ballot arguments need to be signed by whoever authored them and § 9295 provides the only means to correct a ballot argument during the review period.  This was not followed by Respondents and this Court cannot allow a City to follow a different set of rules.

For the foregoing reasons, Amicus respectfully requests that the decision of the Court below be reversed in a published opinion that clearly holds a City is beholden to the exact same set of ballot argument requirements as every other person or entity.  Amicus requests that the City’s signature box bait and switch is not allowed.”

Throwing good money after bad.

tim_2aMy last blog post, Legal Fees Or Legal Fiasco? (scroll down), will give you a perspective on the $154,000 O’Donnell has paid Markman’s firm and how outrageous these fees are in relationship to the work provided.

At a recent Council meeting, Brea resident Don Parker, made a reference to the City of Bell that drew a heated critical response from Markman.

jmarkman_bContrary to the rules governing conducting of public meetings, our City Attorney was neither asked for, nor did he offer a legal opinion.

Pretending he was the 7th member of Council, he blurted out a personal opinion that has no business being expressed while he was involved in the performance of his duties.

Whether discussing the recent unapproved spending of millions of dollars on water shares, the unsanctioned spending of public funds for private travel, the unchecked and rapidly escalating legal costs incurred to cover up a violation of the Election Code, the inadvertent approval of raises Council gave themselves or the brazen disregard for the law that resulted in a member of Council receiving a $2,000 fine from the FPPC for violation of Election law… the common thread is quite apparent.

RRizzoThe loose management style relied upon to run the city, compounded by the obvious lack of transparency and a history for sweeping matters under the carpet, leaves Brea susceptible to the same abuse of power and authority that led to the disaster in Bell.

Is Brea another Bell on the way to happen?

I’m not suggesting that anyone is currently engaged in illegal activities.  I’m saying that the door has been left ajar and that opportunities are ripe for an unscrupulous individual or group to get away with serious larceny.

We need to replace Brea’s less than thorough policies and management guidelines with a set of rules ensuring that opportunities for corrupt activities is virtually zero.