Saturday, January 5, 2013

$54 million: California parks officials deliberately hid money, report says

Fear of embarrassment and budget cuts led California parks officials to intentionally conceal millions of dollars in a department account, according to an investigation conducted by the state attorney general's office. - LA Times

The report, released Friday, is the most detailed official narrative yet regarding the root of the accounting scandal at the parks department.

The scandal broke last summer when it was revealed that the parks department had a hidden surplus of nearly $54 million even though it was threatening to close dozens of facilities.

About $20 million was found in an account where entrance fees and other revenues are deposited. Accounting discrepancies appeared to begin innocently more than a decade ago, leading to fluctuating reports on how much money was in the fund, investigators said.

But in 2002, when the problems were identified, parks officials made a "conscious and deliberate" decision not to reveal the money to officials at the Department of Finance, which plans the state budget.

Multiple high-ranking officials were involved, including the former chief deputy director, Michael Harris, who later lost his job over the scandal. However, the report said it remained unclear whether ousted director Ruth Coleman knew about the accounting problems. Coleman declined to be interviewed for the investigation.
Parks officials didn't report the money because they were concerned that their already reduced budget would be cut even further if the state's number-crunchers knew they had more money in a department account, the report said. Interviews conducted by investigators also showed that officials feared embarrassment if the accounting problems were revealed.

"Throughout this period of intentional non-disclosure, some parks employees consistently requested, without success, that their superiors address the issue," the report said. It wasn't until a new deputy director was installed at the parks department in January 2012 was the issue reported.

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