Daly Tries Again to Strip Audit Power from County Supervisors

State Assemblyman Tom Daly (D-Anaheim) has again introduced a last-minute bill to scale back auditing authority from Orange County supervisors and shift responsibilities to the county’s elected auditor-controller, according to county officials.

County supervisors see the move as payback for a report by the county’s internal auditor, who reports to them, which found that a restricted fund at the county’s clerk-recorder’s office was badly mismanaged under Daly’s tenure before he took office in the Assembly in late 2012.

“This is obviously very targeted to us,” said supervisors’ Chairman Todd Spitzer during last week’s board meeting, noting the critical audit of Fund 12D.

The bill, he added, would be “single-handedly wiping out a tremendous amount of oversight.”

Supervisors unanimously decided to officially oppose the legislation.

What particularly frustrated them was that Daly’s office apparently didn’t notify the county to let them know about the bill.  County staff didn’t find out until last Tuesday, they said.

“It’s shocking to me he wouldn’t call somebody,” said Supervisor Shawn Nelson.  “It’s really inappropriate for a legislator to represent a county and be doing something like this, and not tell anybody.”

Daly’s office has yet to publicly respond to the critique.  His spokesman, David Miller, didn’t return a message seeking comment.

The exact language of Daly’s proposal is unclear; the state’s bill search website doesn’t list the measure when searching for Daly.

But Daly introduced a similar budget trailer bill last year, which called for repealing an auditing-delegating power of county supervisors.

The county’s internal audit centered on Fund 12D, which is financed by document recording fees and under state law can only be used for specific expenses, such as modernizing birth, death and marriage record systems.

Under Daly’s term as clerk-recorder, accounting of the fund was so bad that a record trail couldn’t be generated to legally justify nearly $7 million in spending over a two-year period, the audit found.

At the time, Daly criticized the audit as a political witch-hunt.

He then introduced last year’s budget trailer bill to shift supervisors’ auditing authority to the auditor-controller.

Supervisors had similar frustrations then regarding a lack of notification from Daly.

“The decision to insert this language without consultation with the County did a disservice to the Board of Supervisors and to our relationship with your office,” Nelson wrote in a letter to the assemblyman last June. “We would have preferred working with you on the policy implications of repealing this Government Code section before it was dropped upon us without notice.”

Daly wrote in response that the repealed code section was an outdated remnant of the 1994 county bankruptcy – during which supervisors lost faith in the oversight of county offices like the auditor-controller – and was only meant to be temporary.

Daly also noted that no other county in the state can “completely bypass an elected County Auditor-Controller.”

Although not stated outright, Daly’s response indicates that audits demanded by supervisors are at risk of being politically compromised.

“In my view, it’s clearly preferable for any necessary audits to be conducted by the independent directly-elected County Auditor-Controller, rather than a county employee who reports directly to the Board of Supervisors,” Daly wrote in his response letter.

“My proposed language supports transparency, good governance and proven checks and balances for our county government.”

Daly’s latest measure could be up for a vote as soon as Tuesday, according to county staff.

You can contact Nick Gerda at ngerda@gmail.com, and follow him on Twitter: @nicholasgerda.

  • Vern Pat Nelson

    You can really do that? Author and pass a bill meant mainly to protect yourself from the consequences of your actions?

    And I’m tired of hearing how lame and imperfect the Supes are, every layer of oversight politicians try to strip away is them trying to slip back into corruption.

  • Roger Butow

    Whether it’s the Great Pork, Daly, the DA’s office or the BoS, how is it possible that all of this corruption smoke is never investigated as a fire? Many who post here are as frustrated as I am, a few even more so—-Yet for all of our allegations regarding rampant, malignant, systemic corruption, shouldn’t we be our own Devil’s Advocate, ask ourselves: “Why, if the criminal and civil corruption is so blatant and near the surface, haven’t the State Attorney General’s offices and/or federal DOJ intervened?”
    Literally, “Where’s the beef?”
    That’s a legitimate question, a line of inquiry that begs for resolution.
    They got the Sheriff (rhymes with that reggae tune “I shot the sheriff”), what about the rest of these officials, their flacks and hacks, their insinuated and networked minions of darkness?
    It’s like the entire County dominated by Repubs is under a dark cloud of suspicion, malfeasance, graft and failed fiduciary trust incalculable, oaths of office broken, but higher enforcement oversight powers sit on their hands?
    We have a Democrat AG, a Democrat in the White House, so this “No harm, no foul” logic doesn’t add up.
    Talk about voodoo math, here behind the orange curtain we have voodoo (non-existent or ephemeral at best) justice.

  • David Zenger

    Daly systematically ripped off Fund 12D for a decade, paying “consultants” for not doing anything and worst of all spending over $2,000,000 for a worthless piece of real estate to house the archive and his idiotic County sports hall of fame. The latter swindle was perpetrated by hiding a document that clearly explained the true costs of this fiasco.

    Current County spokesperson Jean Pasco knows all about what happened. She was supposed to be in charge when employed by Tom Daly (in a job she had no professional qualification to hold).

    Daly belongs in jail.

    The only reason nobody in Building 10 (like current CEO Frank Kim – who knew all about it) made a serious issue of the Fund 12D debacle was because the General Fund got an annual kickback from Daly. Nobody knows how many millions were ripped of from the fee payers by this scam.

    • OCservant_Leader

      This building…(I’m glad the issue has floated back up from the sewer) can uncover one of the networks of organized crime currently operating.

      WHO pocketed 2 MILLION DOLLARS? Trace the corporations right back to the Band of Brothers. Put them in prison- strip them of their pensions!

      Everyone involved in the cover up got a piece of that deal- otherwise they wouldn’t have risked it- although it was easy to pull off. I agree Jean Pasco would be a key witness. Where’s this document?

      Put the heat on Daly & Pasco (Federal Indictment) and they will start to talk…only defense of “the Republicans have been doing it for years” won’t fly.

      If one Democrat has to be sacrificed to expose the organized crime – so be it. What Mauk did makes this 2M look like chump change. (Didn’t he kill some people)?

      Zenger- (on a side note) You are a wealth of information! You are a gift! I enjoy your wit as well. I have never heard of an EA getting fired…and wIth every post – you remind them of why they shouldn’t have done that!

  • Philmore

    And this on the heels of previous unsolicited long-distance meddling attempting to arbitrarity reshuffle the County Fire Authority to REMOVE the voices of smaller municipalities !
    For the same reason you don’t give your kid a chainsaw for Christmas, is the total lack of wisdom of electing someone to Sacramento to remove their incompetence from OC now APPARENT? How is the PEOPLES interest well served with VINDICTIVE change replacing the sorely needed CONSTRUCTIVE change?

  • OCservant_Leader

    The building involved in this (#16) is where the real stench is coming from. He purchased a building for over 3M and it has to be demolished? Who owned that building? Who got that gift of over 3M?

    Either the Band of Brothers own that building or they got a huge “finders fee” to secure that deal.

    Anyone have an update ?

    • David Zenger

      No, the building in question is 433 W. Civic Center Drive.

      • OCservant_Leader

        Yes that is it! I’m sorry I got the internal number wrong – what was the building number?

        • David Zenger

          Building 16 is a whole other Supervisorial scam foisted by Nguyen and harvested by all. I’ll tell y’all about it some day.

  • Greg Diamond

    It really comes down to who is more willing and equipped — which may be two different things in this case — to do a serious and effective audit. I could imagine it being either — or neither. (Frankly, at this point, I’d probably rather that it were outsourced to some county that had their act together.)

    Daly’s turning this into a sneak attack, as your report suggests, doesn’t give a lot of confidence that he has the better of the argument.

    Daly’s history with the 12 D Fund — and with his $49,000 gift of public funds to Brett Barbre and $25,000 gift of public funds to Jordan Brandman, with everyone being allowed to walk away unblemished by our District Attorney — leads me to lean towards the Supervisors’ position until more information comes out. (And apparently, if more information does come out, it will have to come from you.)

    • KateD

      Ordinarily, I would agree with your well stated and backed up viewpoint. But when employees bring horrible embezzling and theft to the BoS, and even a Congressman from another county brings it, only for each and every one of them to ignore it? I don’t mean put it aside and get back to it. I mean ignore it for YEARS! That tells me that these clowns are not capable of running a lemonade stand, much less millions of taxpayer dollars.

      • Greg Diamond

        I agree that there is a serious problem with the County BoS’s investigations. But I have serious doubts, based on the distribution of political power in the County, if the Auditor-Controller’s office can (or would) do much better.

        If we start to take the corruption in the County seriously, I think that we’re going to find that we will need outside help. And tragically — I don’t use that word likely — Daly has pretty much disqualified himself as someone who can lead or engineer an anti-corruption effect. He has other good qualities, but being the go-to guy on corruption isn’t one of them. He and other of his supporters seem to be completely in denial about this — which is pretty extraordinary.

        • KateD

          Problem is, in the case I am referring to, they have tried going to the state, been interviewed by the FBI and HHS and done all they can. But unless they have a political enemy in the mix, or billions of dollars at stake, they drag their feet. The DA might hate Spitzer, but he won’t rock that boat. Frankly, I don’t know who you could get on this.

          • Greg Diamond

            I’m aware of some cases in some areas where a county farms out an investigation to another county. Maybe it could be Los Angeles, maybe Sacramento, maybe Santa Barbara for all I know.

            This would be a drastic step and one we’d presumably be unlikely to take. And yet, as a mental exercise, it encourages us to ask the question of why we think that this county *HASN’T* crossed such a line. Maybe this really is as bad as it should have to get before one does.

          • KateD

            Drastic, yes. Necessary? Oh, yeah.

  • KateD

    I agree completely with Daly. The County sips have shown that they are completely incapable of handling the money. They waste too much on their perks and pets, and not enough on the important issues that really matters. Like a kid with a credit card, they are enjoying the lifestyles of the rich and famous, while we go to the poor house.