Storytime for Adults

..or how the City prepares and presents its yearly Audit for the time period BEGINNING July 1st 2012 and ENDING June 30th 2013

  JUNE 13, 2014

   Regularly scheduled City Council meeting Agenda posted  online sometime Friday in the afternoon.  According to the document properties 

CITY COUNCIL AGENDA JUNE 17, 2014

...this document is:

  Created 6/13/2014 1:02:07 PM

...and lists City business matters  for the meeting
as usual.

What seems  unusual is  how this "DRAFT AUDIT" makes its way into the Public Record.  Under the heading... 

 ...ITEM 5.A - BUDGET SCHEDULE
(http://www.ci.beaumont.ca.us/DocumentCenter/View/18865)

Which at first glance appears to be  only a timeline of Budgetary workshop items dating back to February.  Here is the exact wording and format it is presented as...(scroll to bottom of above link)

June 17, 2014 (Workshop and Discussion items)

                1)Public Hearing on General, Special and Capital Improvements Budgets for 2014-15
                2) Adoption of General, Special and Capital Improvements Budgets for 2014-15
                3) Discussion of draft audited financial statement

see actual draft audit @

(http://www.ci.beaumont.ca.us/DocumentCenter/View/18900)

OBTW the above Document properties read:

Created 6/11/2014  10:08:35 AM  (which would be 6 DAYS before Council Meeting)
 
and

Modified  6/17/2014  6:01:22 PM (or moments after Council meeting starts?)

Apparently financial wizards at the City would gladly have a Wimpy Burger today and pay for it tomorrow.  Likewise they expect the rest of us to approve tomorrows spending BEFORE we DISCUSS and RECONCILE the DEFICIT FINANCED SPENDING from years past!!!

It is obvious that the City believes it got screwed in the RDA dissolution deal.  I get it.   $20 million would solve a lot of headaches.  Lets keep it real tho and establish the facts.  Without getting into detail the City failed miserably in attempting to get approval for its "DDR" ( Due Diligence Review) pertaining to Asset transfers, Pass thru Payments to other Taxing Entities (like schools) regarding RDA dissolution  and the State Controller's Office smacked them upside the head and gave a Mathematics 101 lesson to City Staff.  The end result is nearly $3 MILLION in additional monies owed.  The City has agreed and will pay $300,000 per year for 10 years. WHEN this amount is PAID  IN FULL BY the CITY , in like 2022, THE CITY can get a "2 thumbs up DDR" and MAYBE POSSIBLY think about including the $20 million for repayment by way of EOPS (Enforceable  Obligation Payment Schedule)  Even the Auditor sees the folly in believing or relying on this fantasy solution that is years away.  WITHOUT SCO DDR APPROVAL THE CITY CANNOT ADD THIS $20 MILLION AS AN EOPS!

None of this EVEN addresses where the City came up with the $20 million it "loaned" to its now defunct RDA.  Does anyone remember Beaumont   running multi-million $$ Budget surplus for multiple years?  Of course not.  There is only one place the money CAN COME FROM.  It is the same source that the City has used and is using to stay afloat.  Illegal transfers from protected CFD accounts.  Auditors have warned the City about this.  The City response has been... "ITS OK"... because we are paying Interest on the money we are using (stealing).  So even if (or when) City of Beaumont is able to get its hands on the fabled $20 million, it was NEVER theirs to "borrow" much less "loan out" @ 12%AIR and OBVIOUSLY it wont be theirs to keep.  All this money was for and from the CFD areas FOR THEIR FACILITIES and FOR THEIR COMMUNITIES.  This is the REAL reason why no Capital Improvement Projects  (Other than the BOONDOGGLE known as Potrero) can or will go forward without SPECIFIC Council approval.  (Staff apparently wants to be able to say its not our fault...Council told us to steal from restricted CFD accounts)

OK lets take a step back and try and make sense of this.  The City raids CFD Accounts to the tune of $20 million to "loan" to its RDA.  And the City wants that money paid pack from the RDA @ 12% AIR.  City draws line around ENTIRE City declaring it blighted.  City goes on spending spree  and attempts to bill as RDA projects.  Apparently there are protocols and rules in this game the City neglects to follow...again. The State laughs heartily when presented with requests for reimbursement.  As stated above...its all a moot point until they have a clear DDR..in 2022.

So now the clamor from the City is "the State took this" and "the State did that".  In reality the Finance Dept and Staff need to take a long hard look in the mirror.  Its that "Pioneering" plan with little if ANY oversight that is problematic.  Its Council Meetings FOR years with 5-0 votes (or 4-1) with Council riding the wave.  Its been a great ride Im sure.  All I see is shallow water and this shore break is about to pound rocks.

Did any one on the Council ACTUALLY read the Auditor report where it says SPECIFICALLY that the Internal Controls Report is an INTEGRAL PART of this Audit!  ONCE AGAIN that portion has been removed!  Get the Audit an hour before and ask questions in writing?  Isnt that the way our Congressmen do business?  Isnt that THE PROBLEM?  Mr Castaldo has every right to be outraged.  If his own City finance Dept cant adequately track and reconcile his business property records with the Auditors, it begs the questions..Who is throwing Castaldo under the bus and why?   Who is driving this train wreck and does ANYONE else see a sharp turn approaching?

If this is how you accept  and expect  the way the City to "handle its business", vote as you have for the last 20 yrs.  If something seems amiss or no one will answer the questions you might have, take a closer look at what is really going on.  Consider alternatives!