County agency pressed for audit

Dave Brooks

To pay or not to pay, that was the question.

In an attempt to force the Orange County Division of the League of

California Cities to undergo an audit, Councilman Dave Sullivan

proposed at Monday’s City Council meeting a plan to withhold the

city’s $30,000 membership dues until the lobbying group agreed to

open its books.

Councilwoman Debbie Cook later convinced Sullivan to call off his

attempt to force the issue to a council vote, but the exchange

underscores an increasing concern by government officials about the

financial vitality of the lobbying agency.

A change in leadership at the Orange County division’s steering

committee, where Cook sits as vice president, might finally result in

the introspection that city officials, tracing back to former

Councilman Ralph Bauer, said should be required of any agency that

operates with taxpayer dollars. The division recently launched an

audit headed by the city of Orange, and Sullivan said the probe is

long overdue.

“It’s been three years since Ralph Bauer asked for a full audit of

the Orange County Division of the League of California Cities, and it

seems to finally have proceeded,” Sullivan said. “I hope that it will

be a thorough accounting. It’s long past overdue.”

The Orange County Division of the League of California Cities is a

lobbying group that advocates for local cities with the California

legislature and other government bodies. It is the only self-funded,

independent division of the statewide League of California Cities.

Concerns about the finances of the Orange County division began

when Bauer served as Huntington Beach’s representative on the

league’s board of directors from 2001 to 2002. He said he began to

hear rumors about possible financial mismanagement and asked the

Orange County league’s executive director Janet Huston to call for an

outside audit of the books.

“I brought it up two or three times and it never went anywhere,”

Bauer said. “I constantly reiterated this was public money and there

ought to be an audit.”

Bauer said he was never presented a check registry or quarterly

financial reports, but most suspicious was the resistance to an

audit.

“I was to believe there was nothing going on out of the ordinary,

except that they were so vigorous at opposing an audit,” he said.

Several other cities got involved in the fracas when the League

lobbied against a plan to expand the membership of the Orange County

Transportation Authority. Despite being the third largest city in the

county, Huntington Beach had never been able to secure a spot on the

transportation authority’s board of directors. When former

Assemblyman Lou Correa drafted a bill requiring the largest city in

each Orange County supervisorial district be granted an automatic

seat, mandating Huntington Beach and other large cities be given a

place at the table, the League opposed the legislation.

In response Anaheim refused to pay its membership dues for 2004.

In previous years, Bauer tried to convince the Huntington Beach City

Council to take the same action, but was unable to get a majority

vote.

Correa’s legislation was eventually signed by Gov. Arnold

Schwarzenegger and Huntington Beach’s former mayor Cathy Green was

granted a seat on the transportation authority’s board of directors.

Anaheim’s City Manager David Morgan even sent the League a letter

on Jan. 11 explaining that his city planned to begin paying its full

dues for 2005.

“However, we follow with interest the current audit of League

financials for any possible implications,” he wrote. “We strongly

encourage that the audit effort be completed expeditiously so that

cities can make final membership decisions from an informed

position.”

Huston said the disagreement has more to do with the position on

the transportation authority legislation than finances, but warned

that withholding dues is a fiscally irresponsible way of changing

Orange County division protocols. She said the group already has had

to make several last-minute budget revisions because local cities had

neglected to pay their dues.

“The city of Huntington Beach undergoes an audit each year, but do

city residents get to withhold their property taxes until the audit

is complete?” she said. “I think the real question is whether

Huntington Beach thinks being a member of this organization is

valuable.”