RIVERSIDE COUNTY: Report critical of First 5 Riverside

BY JEFF HORSEMAN STAFF WRITER jhorseman@pe.com
Published: 24 April 2012 06:20 PM
First 5 Riverside sat on more than $60 million in unspent funding instead of putting it to use helping children, according to a grand jury report released this week. The report also alleges the agency had tampered with documents and had unqualified people conducting audits.
Grand juries of private citizens are convened each year to investigate public agencies and issue reports on their findings. The report issued this week scrutinized an agency created to help young children.
Known formally as the county Children and Families Commission, First 5 falls under the county Department of Public Social Services. First 5, funded by tobacco taxes that voters approved in 1998, serves children from before they’re born to age 5. Services include early childhood education and health initiatives.
As part of its investigation, the jury interviewed First 5 commissioners, employees and county staff and reviewed First 5 documents. Jurors found that unspent grant funds were not re-allocated. Testimony revealed “a total fund balance of over 60 million dollars,” the report read. “Concerns were expressed over the excessive amount kept in the reserve and not being used to fund children’s programs.” Management had been warned the state would take the money, some of which was meant for future programs, the report read.
In a phone interview Tuesday, First 5 Riverside Executive Director Harry Freedman said his agency had just received the report and would offer a detailed response later.
Freedman said that, while he hadn’t had a chance to look at the report in detail, “we believe there are some inaccuracies.” He said the $60 million figure is outdated. First 5 “spent down the fund balance to a significant degree,” he said. “At this point, we have virtually no dollars in fund balance that are not allocated for specific purposes.”
Citing sworn testimony, the report found “allegations of document tampering and mismanagement of both computer and hardcopy files, including grants and contracts.” No further details were given. Freedman said he wasn’t aware of any tampering allegations.
The report also scrutinized the makeup of the commission that oversees First 5. It includes a county supervisor, the county health officer and a representative from a health-related service agency.
“The commission’s structure could be perceived as causing conflicts of interest in the awarding of contracts in their areas of knowledge and interests,” the report read. “Though apparent care is taken to recuse those affected,” the perception of a conflict remains, the report added.
Other report findings included poor communication among First 5 officials, and “mini-audits” conducted by staff not trained as auditors. Among the jury’s recommendations:
A procedure to track who accesses documents.
Using leftover funds to expand programs.
An independent finance committee to review First 5’s budget.
The appointment of commissioners “not affiliated with agencies most likely to be awarded significant funding.”
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