City of Bell Leaders
Padded Salaries With Money Intended for Low-Income
Housing. State Controller John Chiang reported October 20
that audits of the City of Bell's redevelopment agency and gas tax funds found
at least $1.2 million in inappropriate payments and "management
failures." The Controller's Office explained the situation in a news
release:
"The City of
Bell's Low and Moderate Income Housing Fund, which is to be used only to
increase the local supply of affordable housing, was
instead used to pay for city cell phones, car washes and car batteries,
landscaping, and uniforms. The audit also found that $244,850 in salaries,
vacation, retirement contributions, holiday time, and other compensation was
inappropriately charged to the fund without any approval from the agency's
governing board. Of the amounts charged, $66,100 went to former Chief
Administrative Officer (CAO) Robert Rizzo, and $24,856 went to the Director of
Administrative Services (DAS) Lourdes Garcia. The city could not provide any
evidence that either person's work activities were specifically related to the
housing fund.
"A separate
redevelopment account, the Capitol Projects Fund, was also inappropriately
charged $242,268 for labor. The former CAO was paid $171,444, the DAS was paid
$38,117, and former Assistant CAO Angela Spaccia was
paid $27,066 from the fund. Once again, these payments were made without any
evidence that any work activity was related to the fund."
"Members of
the Bell City Council also served on the Redevelopment Agency's governing
board, and were authorized to charge $60 a month for serving on the agency's
board. The Controller's audit revealed, however, that the members were
receiving $55.38 every two weeks, instead of the maximum $60 a month. In
addition, two former board members received a stipend of $27.69 every two weeks
even though they were no longer members of the board. The audit revealed that
the agency's governing board rarely met, and when Bell City Council members did
convene as the agency's governing board, the majority of those meetings lasted
for three minutes or less."
A separate audit
of the city's Gas Tax Fund and Traffic Congestion Relief Fund disclosed a
number of inappropriate expenditures. For example, the city paid consulting
firm D&J Engineering – which at the time was owned by the city's director
of planning services – $301,810 from the Gas Tax Fund during the past three
years without a contract for services. Other unallowable payments made to
contractors from the Gas Tax Fund included:
·
$129,600
in overpayments for general maintenance services on public streets;
·
$76,992
for street sweeping services without a written contract;
·
$7,806
for painting house numbers on curbs – a benefit to property owners, not the
public;
·
$4,878
in overpayments to an asphalt contractor.
The controller
ordered Bell to fully reimburse $521,086 to the Gas Tax Fund, or the controller
may withhold future state highway user's tax apportionments from the city.
(Source: State Controller's Office news release, October 20.)
Cal-TaxReports, October 22, 2010
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