The East Contra Costa Fire Protection District has announced it has uncovered and corrected a financial mistake that resulted in under-reporting of carryover funds.
At a 3:00 pm special meeting at 3:00 pm on Monday, the East Contra Costa Fire Protection District’s Finance Committee will receive a proposed final budget for Fiscal Year 2017-18. This budget includes an additional $6.2 million above the starting balance in the Preliminary Budget approved by the Board of Directors on June 5, 2017.
The District has made it clear that the funds are one-time money and cannot be used for staffing or re-opening of fire stations.
According to the Press Release by the District, they have identified the underreporting of the starting fund balance based on financial information contained in the recently completed external audit of the Fiscal Year 2014-15 budget. Ongoing discussions with the Contra Costa Auditor Robert Campbell and his staff further clarified the results, and the audit was accepted by the District Board of Directors on August 7, 2017.
Through further inquiry, the District has determined that the underreporting resulted from an incomplete transition of District funds and financial operations from Contra Costa County to the District, dating back to late 2014-early 2015. As a result, carry-over funding was understated in each of the following years, compounding the problem.
“This is a frustrating situation for all involved, but it would be much worse if the District had lower-than-expected funds rather than higher,” said Board of Directors President Joel Bryant. “This Board and staff of the District has done the best they can to serve our community despite being dramatically underfunded and understaffed. I wish the newly discovered funds meant we could proceed with an expanded service model beyond the three stations we have now to protect nearly 249 square miles and 115,000 residents, but access to these “found” monies is not a long-term solution for the District. I look forward to working with the Board and our constituents on a plan for how to put these one-time funds to their most worthy use in service to our community.”
Auditor Robert Campbell added, “My staff and I will continue to work with an assist the District to finalize its financial transition from the County.”
The District said it was grateful for the assistance of its auditor at Maze & Associates, Contra Costa County Auditor-Controller Robert Campbell and his staff, and the finance staff from the City of Brentwood for their help in identifying, confirming, quantifying and correcting the error.
In response to the news, Assemblyman Jim Frazier, who also previously service on the ECCFPD Board while on the Oakley City Council, released a statement saying he has put his funding bill aimed to assist the ECCFPD “on hold” saying the news raised troubling questions.
Here is Frazier’s statement.
“While East Contra Costa Fire Protection District’s discovery of an additional $6.2 million is positive news for residents, it also raises some very troubling questions. I am pleased that my East County constituents will be better protected in the short term with unexpected new funds to improve fire service. But I ask the following: How did the District not know it had $6.2 million in surplus funds – especially when it had repeatedly asked residents to increase their taxes to pay for improved fire service?
The discovery of these funds, while it does represent a sizable percentage of the District’s yearly operating budget, does nothing to solve ECCFPD’s long-term funding problem. All of us who call East County home have been and continue to be concerned about keeping families and property safe. As an East County resident and as your representative in the State Assembly, I authored AB 898 as one method of identifying funds to improve fire safety and emergency medical response – a solution that did not rely in any way on raising taxes. I can see that there is much more work to be done to get the District’s finances stabilized and on track. Given this revelation, I am placing a hold at this time on moving AB 898 forward.
I will remain open to helping ECCFPD any way I am able once we know more about what this audit found, and what future mandated audits may find, in order to evaluate and reassess the district’s financial situation.”
Check back for updates.