Oceano general manager under investigation

May 31, 2011


An investigation into the Oceano Community Services District’s beleaguered general manager’s questionable increases in his own pay is underway following a CalCoastNews exclusive.

Raffaele Montemurro, the manager of the financially strapped district, consistently brags of his ability to cut costs on items such as light bulbs and printer paper while employee expenses skyrocketed during the past few months.

In his defense, Montemurro said that he had given only one employee a step raise and all other wages had remained the same.

However, after remaining constant for months, following the March resignation of Jim Hill, the only board member who regularly examined the district’s financial records, Raffaelle Montemurro’s net pay appears to have increased above his contracted amount, according to district records.

For example, in the latest payroll period that ran from May 12 through May 25, Montemurro logged in 110 hours in two weeks. He paid himself his regular salary as well as 20 hours sick pay, according to payroll records.

Montemurro did not respond to phone calls asking for comment.

On Friday, Oceano board members Matt Guerrero and Mary Lucey examined payroll records at the district office in an attempt to verify information uncovered by CalCoastNews.

“We don’t disagree with your findings,” said Matt Guerrero, an Oceano board member. “We are doing our own investigation.”

According to his contract, Montemurro can accrue one day of unused sick leave per month. If he leaves the district in good standing, he can transfer a portion of his accrued sick leave into his retirement account.

At a special board meeting tonight, board members are scheduled to discuss the discipline, dismissal or release of Montemurro. If terminated, Montemurro is contracted to receive three months salary.

However, if members of the board terminate Montemurro with cause, the district is no longer obligated to pay any severance pay.

During a CalCoastNews investigation, financial records where garnered through individuals and the district’s website. However, shortly after Guerrero and Lucey began reviewing financial records, someone mysteriously dismantled the district’s website.

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Another bit of information to go along with my last comment.

A director at the Santa Maria Youth and Family Center during the time Montemurro was employed there was Vince Martinez, an attorney. He’s the same attorney that defended Lori Angello in her lawsuit for her illegal appointment and intrusion onto the OCSD board. I bring this up because Montemurro was the person who changed the appointment procedures in order for Lori Angello to be on the board. Of course Jim Hill directed him to do it.

I am not ever going to defend Monte but it looks as if you’re really stretching to go after Angelo. So Monte mentioned that he knew an attorney that could advise her, I’m not sure that she used that attorney out of malice or if there is anything wrong with that. The only people that are to blame for the way the Angelo was appointed was the seated board (not including Vern). Monte is hood IMO but Hill was no dummy, he could have directed a different direction regarding the appointment of Angelo but he didn’t and lets not forget that even Dean was in on that. She only saw the light after the fact regarding the mismanagement of that appointment.

Don’t get me wrong, I feel it’s a good thing Monte’s gone but lets hope for the best for the OCSD and not go after the rest of them unless they now show that they’re not competent. Angelo did vote to get rid of Monte so I’ll giver her credit for that. Now if she’ll stop muttering under her breath at others then I’ll give her chance to work with the others to change that board around for the good of the residents of Oceano. I don’t believe that she has ulterior motives as to why she’s there, I don’t believe that she’s ripping them off or doing anything to deliberately hurt Oceano.

TQueen, I think it is unreasonable to lay the burden of responsibility for Montemurro’s perhaps criminal actions on Hill, especially since he was the only one who predictably reviewed the financial records for OCSD, and after he and Henson resigned, none of the three remaining board members bothered to DO THEIR FRACKING JOBS and provide oversight for OCSD, especially in the historical debaclery of everything related to OCSD’s financial matters.

IMO, that is flat-a**ed negligence. They allowed Montemurro to apparently embezzle the extra pay with which he awarded himself. The question is this: did the allow him out of negligence, or did they allow him because the were co-conspirators?

As far as waiting to see if the remaining three show they are incompetent–hello? They have already shown they are incompetent and negligent, at the very least, and may be co-conspirators in Montemurro’s embezzlement of OCSD funds.

In addition, if Montemurro had to rig the appointment procedures so Angelo could become a board member, and she sat by silently, without doing her duty as a board member to provide fiscal oversight for OCSD while Montemurro embezzled funds—I think Angelo should be removed from the board right now, before she has a chance to allow any more embezzlement–or worse–to occur.

Hill always supported Monte. I was shocked that Hill walked out over Monte. Every meeting other than the very last one he seemed to support Monte, he never cracked down on him at all. Even at his last meeting Hill didn’t seem that upset with Monte. Hill was very supportive of Monte and if there is blame for Monte’s hiring Hill has a hand in it. Monte is a thug but I don’t believe that he rigged the appointment procedures. All of their appointment procedures were always a joke, not just Angelo’s. They simply don’t understand how to do those things. I’m not a fan of Lucey but I would take her over Hill any day. At least she stuck with the OSCD and worked to rid them of Monte. When the going got tough Hill bailed. I never liked Hill or Lucey for that matter but when Hill bailed it only verified what I already thought about him, he’s a goofball.

I’m not a big fan of that board but I don’t believe that Lucey and Angelo were co-conspirators at all regarding any possible embezzlement. Lucey called Monte to the table in recent meetings and played a roll in investigating him and although I don’t always agree with Angelo she’s been around a long time and has never ever done anything criminal and I certainly don’t believe that she needs the money.

I don’t agree with many of the things that Lucey and Angelo have done in the past, I don’t like the way that Vern and Dean were treated at all but I am giving hope that they will now finely work together in a cohesive manner to benefit the town of Oceano….I never had convidence when Hill was there. I feel that if Hill wasn’t there that Lucey might have gotten along better with Vern and Dean, Lucey is just easily swayed by the ‘popular’ kids so she was vicious to them, she’s like a school yard bully. But she’s showing improvement.

FYI – Montemurro, Hill and Angello at the time of Angello’s appointment were all buddy-buddy.

I hope all of Montemurro’s actions amounted to a firing with cause, no additional money.

Why did it take so long in closed session? I think Lucey and Angello still need watching. Lucey was right in the thick voting for the computer, Montemurro’s raise, etc. It looks like either her vendetta against Dean/Dahl was more important than doing the right thing, or she just wasn’t paying attention to the job she was hired to do. Dean/Dahl have certainly been vindicated.

As for the new board members, Guerrero and Hurdle appear to be the leaders and have probably played a big role in the justice that appears to have been served.

I have new hope for the OCSD.

Disgusted…… I think you are right on.

That is VERY interesting, Catnip. It may develop into something of significance.

I’m cautious when it comes to guilt-by-association, because usually there isn’t a strong link as to WHY that association would be of concern.

In the situation you bring up, Catnip, there is at least the connection of Montemurro changing the appointment procedures to apparently enable Angelo to become an OCSD board member. IMO, that in and of itself is enough for concern, especially in light of Montemurro’s apparently illegally anointing himself with pay raises, starting right after the resignation of Hill and Henson, when Hill was the only board member who predictably reviewed the financial transactions at the OCSD.

The connection between Martinez and Montemurro, IMHO, needs a little more than just the fact that Martinez was a director at the Santa Maria center when Montemurro worked there.

In the City of Bell case, as heinously corrupt as Rizzo was/is, there was one Bell board member, and many employees and even a manager who do not appear to have been in on the systematic theft of Bell’s funds.

I’ve wondered about Montemurro’s time spent at the Santa Maria center. There seems to be very, very little information available about that.

As my midwestern mother used to say, “A skunk doesn’t change its stripes overnight.” The fact that Montemurro had issues with his previous employer before his time at the SM center, and that he had issues with his employer after his time at the SM center, IMO, would make it unlikely he didn’t have problems at the SM center, too.

“In his defense, Montemurro said that he had given only one employee a step raise and all other wages had remained the same.”

That other employee is Alma Diaz. Montemurro and Diaz worked together at the Santa Maria Youth and Family Center, which was Montemurro’s last job. When Montemurro got hired with Oceano CSD, he brought Diaz along with him without telling the board or going through the hiring process. Her job title is Accounts Payable clerk, which is a job title without a description. She makes more money than anyone at the district, with the exception of Montemurro, without anyone really knowing what she is doing. She needs to go also.

I attended a personnel meeting where Director’s Guerrero and Henson tried to get an answer out of Montemurro as to why he hired Ms. Diaz for $10,000 more a year than the other two office staff made. He did not provide an answer. They directed him to bring job descriptions for all office staff to the next personnel meeting. A month later at the next meeting he did not have job descriptions. He simply would not do as directed. In my opinion I don’t believe he could justify the salary discrepency. No one else who worked in the office could understand what Ms. Diaz did to justify the difference. I kept asking why were were paying contractors $100-$150 an hour to do the accounting and, again, no answer. It has been extremely frustrating to watch month after month this go on and nothing being done. The residents of Oceano are the ones who pay for this travesty.

Cathy, that is really interesting. Of course, as “accounts payable clerk,” Diaz was in a position to assist Montemurro with any financial shenanigans he might be inspired to commit. I think that would make her worth $10,000 more a year–to Montemurro, that is.

I bet it was frustrating to have to watch the board majority allow Montemurro simply ignore a direct order. Good for you for your tenacity in asking the right question at the right time!

Also, the fact that Montemurro brought her along like a favorite chair, not bothering to inform the Board she was part of his employment package, raises questions about why the Board didn’t act at that very moment, and why red flags weren’t raised about this newly-contracted GM.

Hill was the only one who reviewed the finances. After he and Henson resigned because of frustration with Montemurro’s refusal to follow direct orders from the board and his unwillingness to be financially accountable, , none of the remaining three board members bothered to review the finances.

I think this raises some questions bout the three board members that remained after Hill and Henson resigned. Were they part of the Montemurro embezzling?

Clearly, a forensic audit needs to be done of not only Montemurro, but others who allowed him to have free rein at OCSD without demanding accountability.

I also would like to see a forensic audit done of the Santa Maria Youth and Family Center. It is unrealistic to believe Montemurro, perhaps with Diaz’s assistance, did not repeat the financial issues from his prior employment and the problems from his employment subsequent to his time at the SM facility.

These accountants need to be looked at, too. Who are they? There should not have been such issues getting the financial records in order, over time.

Yes Mary, He and his personal friend were the only ones who accually had access to the books. His first move was to get his personal friend in position. Then once she was there, he got rid of Gina Davis, the only other person who would and could know and see what was going on with the books. And remember, at the time, this was exactly what Hill was pushing for. Interesting, isn’t it?

Holy Toledo. This is like being in the middle of a bad remake of the movie “Chinatown.”

AND water rights are involved, too!! I wonder if Angelo stands to gain anything by the sale of Oceano’s water rights?

You are absolutely right Catnip in everything you’ve said here. Her job title is not only a title without a description; it is a job without a pay scale. What he did, was to take the job of Office Manager, line out with pencil the words “Office Manager” and hand write “Accounts Payable” above “Office Manager.” Then he completely ignored the job description for Office Manager but used the pay scale for Office Manager to determine her pay. Then when he hired her without going through the legal hiring procedures, he started her at the second step on the pay scale even though the rules require her to be started at the beginning of the scale. This is like having an opening in a business for an executive, hiring a janitor to do janitorial work and then pay the janitor an executives’ salary. The board later legitimized this when they passed the budget the next year on a 3-2 vote. And they knew this was going on at that time.

Just heard that they fired him. GREAT NEWS! Now maybe Oceano can finally actually move in a positive direction. You know, Dahl and Deen recognized how bad Montemurro was within a month of him being hired. They wanted to get rid of him at that point. One of his first illegal things he did was to hire his personal friend to work for the district. If Hill or Lucey and then Angello (any one of them) would have done the right thing then, Oceano would not have had to deal with him all this time. Instead, they gave him a big raise and extended his contract. They gave him this raise even though he didn’t fulfill the requirements spelled out in the contract he was hired under. I don’t think it took Rip-Van-Winkle as long to wake up as it did those three.

The problem as I see it was the board was split and if Dahl and Dean had said the sky was blue the other three would vote that it was green. I remember when Dean pointed out the terms of Montemurros contract had not been met and she and Dahl voted against a raise. I know I was completely flabbergasted when the other three voted to give him a raise. He hadn’t completed the audits as promised. He had made no effort to get his California CSD Manager certification which was also a condition of his contract (and he never did begin that process). Same thing with the computer program. A lot of research was done to show this company was the highest priced and had been sued by other California cities. The public kept asking where are the other two written bids? Montemurro would schmooze and say he talked to other companies. I personally asked to see three bids and there were no other bids to see. Dahl and Dean voted no for this program and the others voted yes.

I am going to be hopeful these days are behind us and personal feelings are put aside and the board will now all work together and with and for the people they have taken an oath to serve. I was happy to see it was a unanimous vote. I believe the five people there all sincerely care about Oceano and the people of Oceano. It is a tough job and a lot of lessons have been learned the hard way.

I am glad more people are paying attention to this, and I hope more people take a keener interest in all of their local government’s expenditures and activities. Who knows, maybe responsibility might come back in vogue. Nah… but we can hope.

Keep up the great work CCN! I’m glad I donate to CCN – money well spent (even if it’s a paltry monthly sum).

It sounds as if Guerrero and Lucey were the only ones investigating this, I wonder why it was just them and I hope that if this reaches a criminal investigation that they didn’t hurt themselves by doing this. It seems as if it should have either the entire board, or some other entity involved in this. I might be wrong and I hope that I am wrong and that they have covered all their bases. He might be able to claim that they did something to the books/computer because they have an axe to grind.

You are wrong….

Good, I hope so.

You are absolutely, Ms. TQueen.

They need to get an independent professional who is familiar with forensic audits (gosh, where have I heard that term before?). If it goes to court, who would look better discussing what was wrong with the bookkeeping? A brand-new board member, or a professional, licensed, forensic auditor?

With the long-standing issues between the board and Montemurro, the board should not be doing it. There are too many conflicts of interests, because everyone is going to be looking for a landing point for the blame they want to place.

This is a great part, too:

“During a CalCoastNews investigation, financial records where garnered through individuals and the district’s website. However, shortly after Guerrero and Lucey began reviewing financial records, someone mysteriously dismantled the district’s website….”

I would hope Montemurro isn’t desperate enough to harm District property. That puts his alleged crimes at a whole new level.

I can’t see any reason for the board to “dismantle” the website…Karen already accessed the documents and published her findings.

I hope she also downloaded everything she could before it was dismantled. If Montemurro did do it, and corrupted information, it will be helpful to the District to have hard copies of the content. I’m sure they regularly backup the website, but if someone dismantled the website for malicious reasons, they probably took the backup drive/tape/whatever, as well.

You can’t dismantle bank statements. It will catch up with him, and he is dishonest! as well as incompetent.

YEAH, KAREN! Great work!

I loved this line:

“However, after remaining constant for months, following the March resignation of Jim Hill, the only board member who regularly examined the district’s financial records…”

WTF? Aren’t they presented warrants at board meetings? How long can it take to look down a list of checks that had been written before you sign them?

Surely, Montemurro doesn’t have the right to sign checks!

I also like the part, “…after remaining constant for months, following the March resignation of Jim Hill…” I would think that is a strong indication that Montemurro had knowledge of the crimes before and during the time he committed them.

He waited until Hill was gone to embezzle the money…un-freaking-believable.

We may see him in an orange jumpsuit, doing the frog-march, yet.

It is a humiliation to the three board members remaining after Hill resigned that not one of them picked up the reins and started reviewing the warrants/checks to be signed before okaying them.

I believe these are things paid as an auto pay type thing and because it is checks paid on an ongoing basis they are not signed by board members. However….they get this info in the financial report and should have reviewed it. Not good that a newspaper reporter is the one doing the board members jobs.

Definitely not good Montemurro is doing this. But a lot of things he has done is not good.

Even if it is an autopay, someone has to authorize the extra money going into Montemurro’s account.

I think the whole board should be recalled, frankly, for not doing their duty as board members and staying on top of the financial situation. Jeeze, especially with Montemurro’s history!

FYI – Although not an excuse, Montemurro would keep as much knowledge from the board as possible. When he would give information to the board, it was always last minute. Remember when the board (Hill, Lucey, and Angello) on a 3-2 vote approved the purchase of an expensive new accounting system? Montemurro didn’t tell the board how much it would cost until just before the baord was ready to vote on the issue. And then, when he did tell the board, the price he gave the board was about half of what the actuall cost was. …….and those three voted for it anyway. Amazing!

Yes, it is clear Montenurro was unfit for duty. He failed in his position.

It is also clear that some of the board members were/are also unfit for duty, and failed in their position.

Just getting rid of Montemurro and addressing his malfeasance won’t fix the problem. There is always a chance that a GM will turn out to be unfit for duty.

The real problem here, IMO, is the board members who refused to take action against Montemurro and, after Hill resigned, did not perform their duty of providing financial oversight for OCSD.

If you had a city where there were criminals and also a police departmetn that was incompetent or perhaps in collusion with the criminals, refusing to provide adequate oversight and policing of the population so as to be able to identify and catch the criminals–would you think getting rid of a few criminals but leaving the police department as is would solve the problem of crime in the city?

No, it wouldn’t.

That’s the situation with OCSD. The board, which should be policing the administration of the district, is not. Therefore, criminals are allowed to flourish and wreak havoc.

The criminal and the incompetent–or corrupt–board members have to all go, otherwise the situation is likely to occur again.

Good Point.

Time for a county Grand Jury investigation. From SLO county GJ website:

“The primary function of the grand jury is to examine all aspects of local government, ensuring that the county is being governed honestly and efficiently and that county monies are being handled judiciously.

A grand jury is a body of the required number of persons (19 in San Luis Obispo County) returned from the citizens of the county before a court of competent jurisdiction and sworn to inquire of public offenses committed or triable within the county.

Each grand jury is charged and sworn to investigate or inquire into county matters of civil concern. [Penal Code Section (PC) § 888]”

Yep, sounds like it is right up their alley.

We need the Grand Jury and we need to accept help from the county. Apparently, they county offered to help getting the audits out and Montemurro turned them down. No surprise.

It is my opinion boards and employees have done things improperly for years and there really was a good old boy system going on. In the past 10 years more people have moved into Oceano who care about the community and their property values. I know that is why I took an interest in the OCSD circus.

I was criticized for standing by Pamela Dean in going to court to force the district to comply with California law. Complying with the law is not something previous board members or staff felt they had to do. Because the courts had to step in now the people of Oceano will be paying for those legal fees when it all could have been avoided if they would have just complied with the law.

There are a lot of people who are watching, paying attention and want things to be done in compliance with the law. Hopefully there will be a lot more changes, for the better, in the months to come.

Bravo Cathy. You have always stood up to do the right thing. I wish you were on the board. Hopefully, at the next election. I will support you.

This isn’t surprising. I can’t wait to hear the details of tonight’s dog and pony show but I’m afraid that we might not hear those details..

Let’s hope for the sooner the better.