State parks hoarded $54 million, claimed budget shortfall
July 21, 2012
The director of California’s state parks resigned and a deputy was fired Friday following the discovery the department had stashed away nearly $54 million in surplus money while parks were threatened with closures because of budget cuts.
While the under-reported cash remained untapped, the California Department of Parks and Recreation claiming dire financial health was soliciting donations slated to help keep some of the to state parks scheduled for closure open, including Morro Strand State Beach campground in San Luis Obispo County.
A preliminary investigation into Parks’ finances has revealed that for at least 12 years the department underreported tens of millions of dollars to the state Department of Finance. As a result, the Department of Finance was not aware that the State Parks and Recreation Fund and the Off Highway Vehicle Fund held $20,378,000 and $33,492,000 respectively above their official, most recently reported balances. The underreporting occurred over the course of two prior gubernatorial administrations.
Governor Edmund G. Brown Jr. asked the state Attorney General’s Office to investigate the circumstances surrounding the underreporting by the parks system that dates back to at least 2000. Governor Brown has also directed the state Department of Finance to conduct a comprehensive audit of Parks’ fiscal controls and the California Natural Resources Agency Secretary John Laird to conduct a sweeping review of Parks’ management.
“I welcome Governor Brown’s swift action to address these hidden assets,” Laird said. “We will get to the bottom of this situation and work with the Attorney General, the Legislature and the Department of Finance to make sure nothing like this ever happens again. We will also work with the Legislature to see how this money can be used to mitigate park closures.”
Governor Brown has accepted the resignation of Parks Director Ruth Coleman and Chief Deputy Michael Harris was fired.
Governor Brown appointed California Natural Resources Agency Undersecretary Janelle Beland as acting interim director of Parks. He has directed her to promptly report to him and Secretary Laird on further actions that should be taken to ensure that the Department is being managed with honesty, accountability and transparency, according to a press release.
In addition to their audit of Parks, the Department of Finance is reviewing all special funds across state government to verify that departments have provided identical fiscal information to Finance and the Controller. The Department of Finance has also put new protocols in place to strengthen how special fund figures are verified and reconciled with data from the Controller and other sources.
The State Parks and Recreation Fund was established in 1979. Its sources of revenue are fees, rentals and returns collected for the use of any state park system area. It can be used for resource management and protection, planning, acquisition and development projects.
The Off-Highway Vehicle Trust Fund was established in 1971. Its sources of revenues are off-highway vehicle registration fees, transfer fees, penalties, fines and forfeitures. It can only be used for acquisitions, development, construction, maintenance, administration and conservation of areas for the use of off-highway motor vehicles.
The hidden assets were brought to light when new Parks fiscal staff began an internal review of accounts, following a separate investigation by the Attorney General over unauthorized vacation buy-outs.