Friday, May 30, 2014

Yolo County Grand Jury faults Woodland for real estate loans

May 28, 2014
By Jim Smith
Daily Democrat

When it comes to managing real estate loans, the city of Woodland is doing a poor job, the Yolo County Grand Jury found in a report released Wednesday.
The Grand Jury called for a series of actions to more effectively manage its affordable housing loan program, including developing and implementing policies, preparing annual reports and generally "make it a priority to maintain trained administrative services necessary to effectively manage its affordable housing loan portfolio."
Jane Naekel, forewoman for the 2013-14 Grand Jury, reported the body undertook the investigation after receiving a complaint the city was not properly executing its duties on a loan it made in 1995 to Leisureville Community Association.
The city manages and administers a portfolio of affordable housing loans in excess of $24 million, according to the report.
However, it has "not established a viable system for tracking or reporting on these loans."
"Between 1995 and 2013, the city neglected to manage the LCA loan which requires the city to review and approve annual budgets and semi-annual performance reports, to participate in the selection of the management firm responsible for managing the complex, and to receive residual receipts of operations to offset the interest of the loan," the Grand Jury reported. "The city was made aware of the deficiencies in managing the LCA loan in July 2013 and responded by initiating actions to remedy the situation."
According to the report, the city is in the process of determining the full extent of its responsibilities and establishing protocol for managing its portfolio of affordable housing loans.
"While the city is taking positive steps to ensure the LCA loan is managed as specified in the loan documentation, the Grand Jury recommends that the city create a database of its real estate loans, develop policies and procedures for managing the loans and report annually to the City Council on the status of its loan portfolio," the jury stated in its report. "These additional steps would help to ensure that similar problems would not occur with other loans in its portfolio now or in the future."
Leisureville is located at 1313 E. Gibson Road, and is a cooperative formed in 1995 with all residents buying into the cooperative and that 51 percent or more of those residents meet low-income requirements.
In 1995, with the assistance of the city of Woodland and the Yolo County Housing Authority, Leisureville Community Association purchased the Leisureville Mobile Home Park. The purchase was made with a combination of commercial and federally supported loans. The total loan from the city was $1.2 million. Payment on the principal of the loan is delayed and interest continues to accrue, until 2025 when the original loan, plus accrued interest, is due.
According to loan documents, Woodland is required to receive and approve Leisureville's annual operating budget prior to adoption by the Leisureville Board of Directors; review and approve management contracts; receive and review semi-annual progress reports from Leisureville; and accept annual payments for residual receipts to pay toward accrued interest.
In turn, the LCA's primary areas of responsibility to the Woodland include submitting budgets for review, submitting semi-annual financial reports, obtaining approval for management contracts, remitting residual receipts each year to offset accrued interest and repaying the entire loan plus interest to the city by 2025.
"The city excuses its negligence by saying that typically, real estate loans have a term much longer than the typical city employee stays in a position," according to the Grand Jury. "Nonetheless, the city has a responsibility for developing systems and processes that extend beyond the employment of any given individual."
The Grand Jury noted that the same complaints it received were also reported to Woodland and beginning in July 2013, the city submitted a claim for residual receipts for 2012-13 and began insisting on annual budgets and mid-year reports from Leisureville.
The City has also taken steps to stabilize the management of the Community Development Department such as transferring the affordable housing duties, including management of the real estate loan portfolio, to the Community Services Department which had been previously known as Parks and Recreation.
"After reviewing the LCA financials, the Community Development Department staff recognized that the LCA may not be able to make a 'balloon' payment of approximately $3 million (principal plus accrued interest) in 2025. The city manager and the mayor, in a letter dated Sept. 5, 2013 to LCA's Board of Directors, informed LCA that the city may reconsider refinancing the loan subject to approval by the Woodland City Council in 2025."
"The Grand Jury has seen no guidance in the rules or regulations, or in the contract, that suggests the mayor or city staff have the authority to make these adjustments and promises," according to the Grand Jury.
As a result of its inquiry, the Grand Jury is recommending:
• That by Sept. 1, 2014, the city create a database of its portfolio of affordable housing loans to ensure that the provisions of the loans are met.
• That Woodland direct the Community Services Department, the current agency administering the city's loan portfolio, to develop a policy and procedure manual for real estate loans, identifying who is required to manage loans and how, and on whose authority, a loan can be modified. This policy and procedure manual should be completed by Jan. 31, 2015.
• That Woodland develop an annual report to the City Council regarding the real estate loan portfolio. It should include an updated database, the value and status of each loan and important outstanding issues. The first report should be presented by Sept. 1, 2014.
• That the city make it a priority to maintain trained administrative services necessary to effectively manage its affordable housing loan portfolio over time.

Wednesday, May 28, 2014

Supervisors back off slashing (Orange County) grand jury pay

Lew Avera of San Clemente, left, and Bette Flick of Costa Mesa have served as the Orange County Grand Jury foreman in 2004 and 2005, respectively. Avera believes that the Orange County Board of Supervisors debate about cutting the juror stipend from $50 to $15 is discouraging. He adds, People don't depend on (the stipend). Most people who serve are retired. Fifty dollars appeals to people because it sends messages that it's a very important service to the county.
Lew Avera of San Clemente, left, and Bette Flick of Costa Mesa have served as the Orange County Grand Jury foreman in 2004 and 2005, respectively. Avera believes that the Orange County Board of Supervisors debate about cutting the juror stipend from $50 to $15 is "discouraging." He adds, "People don't depend on (the stipend). Most people who serve are retired. Fifty dollars appeals to people because it sends messages that it's a very important service to the county."


Published: May 20, 2014 Updated: May 21, 2014 6:28 a.m.

Grand jurors say a plan by the Orange County Board of Supervisors to slash their pay is retribution for past investigations, but the board says it’s Sacramento’s doing.

Supervisors on Tuesday considered an ordinance to cut grand jury pay by 70 percent, taking the daily rate from $50 to $15 – the minimum amount mandated by state penal code. The item, introduced by Supervisor Shawn Nelson, was discussed, then tabled. The review came just as new jurors were selected to start service.

The proposal follows heated discussions nearly a year ago when supervisors and grand jury members squared off when Supervisor Todd Spitzer introduced reducing juror pay as a way to save several hundred thousand dollars in the county’s $5.4 billion annual budget.

At that time, the board asked for a review of recruitment, compensation and retention, but it was never conducted. The board noted Tuesday that should be done before any action is taken.

“I think we blew this one when we applied last year,” Spitzer confessed. “We suffered criticism because it made us look like we were retaliating. The daily stipend could make the difference between someone applying and not applying, especially if they‘re retired. I’m very concerned if we can’t get citizens to apply.
They truly do a very important public service.”

The grand jury consists of 19 county residents, often retirees, who serve for 12 months starting in July. It is empowered to bring criminal indictments and conduct civil investigations of county and city governments. Many who serve say they do it as a way to give back and add that serving provides insight into law enforcement and county agencies. Jurors in Los Angeles County get $60 a day and jurors in San Diego County are paid $25.

On Tuesday, Nindy Mahal was selected to the grand jury for the third time, which included an era supervisors called “rogue” following a report titled, “CalOptima Burns While Majority of Supervisors Fiddle.” That 2013 study rankled supervisors and caused Supervisor John Moorlach to characterize the study as “sensational and tabloidish,”

“A Call for Ethical Standards: Corruption in Orange County,” released in April also drew supervisors’ outrage.

The CalOptima report cited the departures of 16 senior executives within 18 months after Supervisor Janet Nguyen joined its board. The jury recommended that more than one supervisor serve on CalOptima’s board, and that county staff members be removed from the board. The supervisors rejected both recommendations.

Nguyen said she had to hold a press conference to defend herself following the grand jury’s allegations. “I pleaded to them not to release the report. I wanted to come and speak to them,” she said. “You were supposed to be objective. I don’t respect the 2012-13 report.”
Still, Nguyen distanced the report and the proposal to cut juror’s pay. “This has nothing to do with going against the grand jury.”

But Mahal, who has a background in accounting and finance, recalled events differently. “We kept trying to arrange a time to meet her and we’d show up and she would have just canceled.”
Like Mahal, dozens of current and past grand jurors called the supervisors actions to cut their pay conspiratorial.

For Mahal being a juror has changed his life. “I was born in India and it’s such a corrupt country,” he said. “The grand jury is a very important institution. It keeps the Board of Supervisors, city and county officials and law enforcement in line. They are aware that someone is watching and they know they can’t escape in their misdeeds.”

Supervisors “can’t control the grand jury,” said John Moohr, president of the Grand Jury Association. “The only thing they can control are the fees.”

Nelson said if it were up to him, he’d give the grand jurors $100 a day. He plans to look for legislation to set an appropriate fee for reimbursement. He added the state took $78 million from the county last year, and that the discussion of lowering the grand jury’s pay coincided with that.

“It’s easy to assume there was a grand conspiracy,” Nelson said. “We’re responding to a state mandate that is improperly funded.”

Contact the writer: 949-492-5152 or or

(San Diego County) Grand Jury: County Lockups Filling; ‘Significant Costs' to Enlarge Facilities

May 27, 2014
By Gene Cubbison
NBC Channel 7, San Diego

Local taxpayers figure to be digging deeper and deeper into their checking accounts to pay for local jails and detention facilities.
That prediction comes from a just-released report by the San Diego County Grand Jury.
With the state under federal court orders to reduce prison populations, non-violent "low level" felons have been sentenced to county jails since late 2011, under the AB 109 “prison realignment” law.
Those lockups, say grand jurors, are now getting so full that more space, beds and detention
"The system's facilities were never designed for long-term-stay people,” grand jury foreman Gregory Ny said in an interview Tuesday. "We've got people that are going to be incarcerated for as long as ten years. And with that comes increased issues of housing, medical treatment."
It all adds up to “significant” unknown future costs, Ny warned: “It's not like building a warehouse or building a home or hotel."
Some $300 million is being spent to rebuild Las Colinas Women's Detention Center in Santee, to triple its current capacity to 1,250 inmates.
The first phase is scheduled for completion this summer; the second and last phase, next year.
Meantime, space is being added for 400 more beds at the men’s "re-entry" facility on East Otay Mesa.
Given that the state hasn't reimbursed the counties for the full cost of the transitioning more offenders to local custody and probation, there are questions as to what extent the governor and lawmakers will help subsidize the counties' jail construction budgets.
"We go up a lot of times and talk to 'Sacramento',” says Jan Caldwell, spokeswoman for Sheriff Bill Gore. “ They're well aware we have issues here -- as do other counties in California. So if they're going to give us this 'population', we need the financial tools to deal with it."
The expansion projects also carry added costs for hiring and training new deputies to manage the rising head counts -- 250 more female deputies will be needed at Las Colinas alone, at a time when recruiting efforts aimed at women are falling short of goals.
"It's hard sometimes to find women who want to work in law enforcement,” Caldwell told NBC 7. “They might have other careers, they have families, young children, other things that come into play here."
One encouraging note in the grand jury report: Inmate deaths in our local jails have trended down over the past five years, from 12 in 2009 to 8 last year.
Of the five-year total of 49, 16 were listed as suicides and three as homicides.

(Marin County) Novato’s Gnoss Field needs tweaks, but here to stay, grand jury says

May 27, 2014
By Janis Mara
Marin Independent Journal

Jury recommends changes to security, financial reporting

The county airport at Gnoss Field is well-managed, beloved by many, resented by some, could use some improvements and is not going away, says the Marin County Civil Grand Jury.

"We see no reason to close Gnoss. In fact, there is no option but to keep the airport," the grand jury said in a report released late last week. "The Federal Aviation Administration has spent millions of dollars supporting the airport, and the county ... is obligated to keep it in place."

The report was mostly positive. The grand jury did make minor recommendations mostly focused on security improvements. The report also recommended that the county improve accounting of its enterprise fund to make sure the airport's revenues and expenses are reported within that fund and not the general fund.

An airplane climbs past parked aircraft at Gnoss Field on Tuesday, Feb. 4, 2014, in Novato, Calif. Plans are to extend the runway 1,100 feet to the north. (IJ photo/Frankie Frost)

The 120-acre airport north of Novato is home base for 300 aircraft, most of them privately owned, and it hosts about 95,000 take-offs and landings per year. An ambitious $17 million plan to improve the airport by extending the runway 1,100 feet is currently under consideration, though the plans depend largely on federal funding.

The airport provides "the advantage of convenience, the ability for some businesses to handle travel needs, and a lot of fun for those who enjoy the world of flying" to those who use it, the report said. In a previous grand jury report, the number of people using the facility was defined as less than one-tenth of 1 percent of Marin's population.

The report suggested that Marin residents "visit your airport," and praised the facility's employees and manager for their knowledge and experience. The grand jury described the airport's physical condition as "adequate."

The airport has four security and safety issues, plus one financial problem, the report said. The airport has only one full-time employee, the manager, who works five days a week, and two part-time employees, the grand jury noted. It recommended increased staffing to provide seven-day-a-week, 24-hour coverage.

Second, the grand jury recommended improving the airport's fencing and its video surveillance system to improve security. The report did note that the Transportation Safety Administration has determined that the probability of a major incident at a general aviation airport like Gnoss is relatively low.

Parts of the report were tongue in cheek, particularly in regard to the fencing issue. "Although the Grand Jury members decided not to try to scale the fences ourselves, we believe that a person with reasonable agility and a desire to enter the airport could do so at virtually any spot along the periphery," the report said.

The grand jury also recommended keeping gates and door locked at all times, locking hangar doors in unattended areas, posting emergency numbers and ensuring easy access to phones in various locations.

Third, "We recognize that there is potential to use the airport in times of disaster, but failed to find any evidence that the airport is ... included in the county's emergency plans," the report noted.

Hence, the grand jury recommended that Department of Public Works staff complete an emergency response plan using the template provided by the Department of Homeland Security.

Fourth, the report noted that the runway will likely need repairs before the proposed 2018 date of a possible runway extension. It recommended that the county inspect the runway and make needed changes including resurfacing as necessary.

Noise is a concern of those living in neighborhoods near the airport, and 90 people signed a petition asking for a review of the noise from planes taking off and landing, the report said.

"The airport website shows altered landing and takeoff patterns to minimize over flights of the neighborhoods," the report said, adding that "several interviewees told the Grand Jury that the current airport manager speaks to each pilot reported to have flown over homes and provides directions to avoid doing so."

With noise in mind, the grand jury recommended that the county keep in touch regularly with residents of the Rush Creek and Bahia neighborhoods in the vicinity "to address noise complaints and efforts undertaken by the county to reduce incidents."

While the report had many recommendations, none seemed to reflect serious problems. Much of the report took an upbeat tone, with one section suggesting that residents "some Saturday or Sunday, load up the family and drive out to Gnoss Field to watch a few takeoffs and landings."

Dan Jensen, the airport's manager, said he had not yet had time to digest the report and had no comment, though "we'll definitely provide the grand jury with a response."