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Newly sworn-in County Auditor-Controller Eric Woolery is right; his job, to which he was elected by the people of Orange County, should include being the lead auditor of the County’s finances, contracts and fiscal operations. Assemblyman Tom Daly who has instigated legislation that would ostensibly return that authority to Woolery is right, too, but for the wrong reason.
After the disastrous bankruptcy of 1994 and the subsequent political fallout, the Board of Supervisors deemed it necessary to bring the “internal” auditing function – those not entrusted to outside audit firms – under their own purview in the form of an Internal Audit Department answerable only to them. Although Auditor-Controllers David Sundstrom pushed back against this fundamental change to the County’s “constitution” it was to no avail.
To badly paraphrase Oliver Wendell Holmes: big government disasters make bad government policy. The very independence that can be wielded by a qualified elected Auditor-Controller was lost by replacing that invaluable instrument with an individual who answers directly to the Supervisors and is beholden to them for his pay and the renewal of his contract. He becomes the political creature of the Supervisors and loses the necessary impartiality and objectivity of a real auditor.
My own experience in the County bears this out. In 2013 as an Executive Assistant for the 4th District I discovered a grossly mismanaged contract for the management of the Dana Point Harbor renovation. Mysteriously, this contract jumped the rails in 2007 and, in contravention of both County policy and best practice had been switched to a “fixed fee” arrangement in which the contractor automatically received about $50,000 a month, every month, regardless of what he actually accomplished and until the original contract amount was used up. Millions of dollars were paid out this way from 2008 through 2013 despite the fact that the project was almost completely stalled during those years. The balance of the contract had been burned through and the project was still years away from breaking ground.
I notified the Internal Auditor and supplied him with all the embarrassing details of this contract, as did two members of the public via the Internal Auditor’s so-called “Fraud Hotline.” After several months of delays – when demanding accountability was still possible – the Internal Auditor essentially provided cover for both the Dana Point Harbor Department and 5th District Supervisor Pat Bates, who had taken the investigation as a personal affront. In the end nobody asked where the millions went and why the contract – the only one of its kind at the County – was ever separated from the contractual scope of work in the first place. The issue was quietly brushed under the supervisorial carpet and the contractor was given even more millions and another five-year contract extension.
This result should in no way be considered surprising. For a good deal of the Winter of 2013 the Internal Auditor had been importuning me to intercede with my Supervisor to get him a pay increase; furthermore, his contract was ending in June. He had every reason to toe the Supervisorial line and almost no incentive to root out the underlying problem of the incompetence and mismanagement by the Dana Point Harbor Director.
How many other issues and projects at the County have gone without proper scrutiny because the audit function has been politicized? I don’t know. Nobody does. And that’s the real reason the County needs an Auditor independent of the Board of Supervisors.
Finally, let’s return to the aggrieved Mr. Daly: his assertion that as County Clerk-Recorder he was the victim of a political persecution by the Republican Board, via the Internal Auditor, is pure, self-serving nonsense. His ten-year serial abuse of Fund 12D and the accounting mess it represented actually went unaudited for far, far too long. If anything the tepid audit results were too tempered by the kindness of political diplomacy.
Ironically, it was the extent of Daly’s misappropriation of the Fund 12D money, the lack of any reasonable accounting, and – most importantly – the fact that Fund 12D was actually backfilling the General Fund, that all illustrate the absolute need for a completely independent auditor, not one encumbered by the byzantine politics of the Hall of Administration.
That auditor should be duly elected Auditor-Controller Woolery.
Dave Zenger is a former senior political aide to County Supervisor Shawn Nelson. Zenger left county service last year, filing a claim for wrongful termination, after a series of his investigative probes triggered the ire of other county supervisors.