SACRAMENTO -- A week after uncovering a hidden-funds scandal at the state parks department, finance officials are now trying to piece together why the balance sheets for similar "special funds" are off by $2.3 billion -- money that appeared to be right under their noses amid California's financial meltdown.
An analysis by this newspaper of California's little-known 500-plus special funds -- like the ones that included $54 million in parks money shielded from the Department of Finance -- shows tens of millions of dollars in discrepancies in numerous accounts.
The fund that gives restitution to violent crime victims was off by $29 million. The one that provides children with low-cost health insurance was $30 million out of balance. The fund that rewards people for recycling bottles and cans was $113 million off.
"Where are these dollars?" asked state Senate budget chairman Mark Leno, D-San Francisco, who said it was a "big problem" that the special funds "clearly have not been getting enough attention."
The newspaper's review found at least 17 accounts that appeared to have significantly more reserve cash than what individual departments reported to the finance department, though it's unclear why.
An account that helps build state courts had $27 million more on the controller's ledger than the figure reported to the finance department. A pool of money that helps problem gamblers was off by $7.9 million. Another fund that
assists in prison guard training was off by $6.4 million.
The problem could date back decades and is only now coming to light after discrepancies were discovered in the parks funds, costing longtime parks director Ruth Coleman and deputy director Michael Harris their jobs.
The potential error is especially remarkable considering how easy it would have been to catch.
Earlier this year, dozens of state departments told Gov. Jerry Brown's budget aides that they had a combined $8.8 billion left in "rainy day" reserves for their special fund accounts as of a year ago. At the same time, the controller's office tabulated a total of $11.1 billion in cash reserves for the accounts.
But finance officials, operating under a longtime honor system, never checked the controller's total -- and no oversight groups caught the discrepancy, even though the numbers are publicly available on two state websites. As a result, Brown and the Legislature used the smaller $8.8 billion figure when they approved the state's annual spending plan last month.
Finance officials are now going through each fund, line by line, to determine how much of the money is truly hidden.
"It's hard to ask people to increase their taxes when they hear about things like this," said state Sen. Mark DeSaulnier, D-Concord, a member of the Senate budget committee. "I don't know (how this happened), but it's completely unacceptable."
http://www.mercurynews.com/californ...up-2-3-billion-california-public-funds-hiding
Hopefully it will be very hard for Gov. Moonbeam to pass his tax increases that he wants this November.
An analysis by this newspaper of California's little-known 500-plus special funds -- like the ones that included $54 million in parks money shielded from the Department of Finance -- shows tens of millions of dollars in discrepancies in numerous accounts.
The fund that gives restitution to violent crime victims was off by $29 million. The one that provides children with low-cost health insurance was $30 million out of balance. The fund that rewards people for recycling bottles and cans was $113 million off.
"Where are these dollars?" asked state Senate budget chairman Mark Leno, D-San Francisco, who said it was a "big problem" that the special funds "clearly have not been getting enough attention."
The newspaper's review found at least 17 accounts that appeared to have significantly more reserve cash than what individual departments reported to the finance department, though it's unclear why.
An account that helps build state courts had $27 million more on the controller's ledger than the figure reported to the finance department. A pool of money that helps problem gamblers was off by $7.9 million. Another fund that
assists in prison guard training was off by $6.4 million.
The problem could date back decades and is only now coming to light after discrepancies were discovered in the parks funds, costing longtime parks director Ruth Coleman and deputy director Michael Harris their jobs.
The potential error is especially remarkable considering how easy it would have been to catch.
Earlier this year, dozens of state departments told Gov. Jerry Brown's budget aides that they had a combined $8.8 billion left in "rainy day" reserves for their special fund accounts as of a year ago. At the same time, the controller's office tabulated a total of $11.1 billion in cash reserves for the accounts.
But finance officials, operating under a longtime honor system, never checked the controller's total -- and no oversight groups caught the discrepancy, even though the numbers are publicly available on two state websites. As a result, Brown and the Legislature used the smaller $8.8 billion figure when they approved the state's annual spending plan last month.
Finance officials are now going through each fund, line by line, to determine how much of the money is truly hidden.
"It's hard to ask people to increase their taxes when they hear about things like this," said state Sen. Mark DeSaulnier, D-Concord, a member of the Senate budget committee. "I don't know (how this happened), but it's completely unacceptable."
http://www.mercurynews.com/californ...up-2-3-billion-california-public-funds-hiding
Hopefully it will be very hard for Gov. Moonbeam to pass his tax increases that he wants this November.