San Jose City

CITY OF SAN JOSE Audit Report DOMESTIC VIOLENCE ARREST POLICIES AND STANDARDS PROGRAM Chapter 246, Statutes of 1995 July 1, 2018, through June 30, 2021 M M. C ALIA OHEN California State Controller April 2024 MALIA M. COHEN CALIFORNIA STATE CONTROLLER April 29, 2024 CERTIFIED MAIL—RETURN RECEIPT REQUESTED Rick Bruneau, CPA, Finance Director City of San Jose 200 E. Santa Clara Street, 13th Floor San Jose, CA 95113 Dear Mr. Bruneau: The State Controller’s Office audited the costs claimed by the City of San Jose for the legislatively mandated Domestic Violence Arrest Policies and Standards Program for the period of July 1, 2018, through June 30, 2021. The city claimed $619,419 for costs of the mandated program. Our audit found that $529,478 is allowable and $89,941 is unallowable. The costs are unallowable because the city overstated salary and benefit costs, and related indirect costs. The State paid the city $616,866. Following issuance of this audit report, the Local Government Programs and Services Division of the State Controller’s Office will notify the city of the adjustment to its claims via a system- generated letter for each fiscal year in the audit period. If you have any questions regarding this report, please contact Lisa Kurokawa, Chief, Compliance Audits Bureau, by telephone at (916) 327-3138. Sincerely, Original signed by Kimberly Tarvin, CPA Chief, Division of Audits KT/ac MAILING ADDRESS P.O. Box 942850, Sacramento, CA 94250 SACRAMENTO 3301 C Street, Suite 700, Sacramento, CA 95816 | 916.324.8907 LOS ANGELES 901 Corporate Center Drive, Suite 200, Monterey Park, CA 91754 | 323.981.6802 Mr. Rick Bruneau April 29, 2024 Page 2 of 2 Copy: The Honorable Matt Mahan, Mayor City of San Jose Jennifer Maguire, City Manager City of San Jose Victor Lo, Principal Accountant City of San Jose Anthony Mata, Chief San Jose Police Department Jennifer Otani, Administrative Officer San Jose Police Department – Fiscal Unit Sylvia Perez, Senior Analyst San Jose Police Department – Fiscal Unit Chris Hill, Principal Program Budget Analyst Local Government Unit California Department of Finance Kaily Yap, Finance Budget Analyst Local Government Unit California Department of Finance Darryl Mar, Manager Local Reimbursements Section State Controller’s Office Everett Luc, Supervisor Local Reimbursements Section State Controller’s Office MAILING ADDRESS P.O. Box 942850, Sacramento, CA 94250 SACRAMENTO 3301 C Street, Suite 700, Sacramento, CA 95816 | 916.324.8907 LOS ANGELES 901 Corporate Center Drive, Suite 200, Monterey Park, CA 91754 | 323.981.6802 City of San Jose Domestic Violence Arrest Policies and Standards Program Contents Audit Report Summary ............................................................................................................................ 1 Background ........................................................................................................................ 1 Audit Authority .................................................................................................................. 1 Objective, Scope, and Methodology ................................................................................. 1 Conclusion .......................................................................................................................... 3 Follow-up on Prior Audit Findings .................................................................................. 3 Views of Responsible Officials .......................................................................................... 4 Restricted Use .................................................................................................................... 4 Schedule—Summary of Program Costs .............................................................................. 5 Findings and Recommendations ........................................................................................... 7 Attachment—City’s Response to Draft Audit Report City of San Jose Domestic Violence Arrest Policies and Standards Program Audit Report Summary The State Controller’s Office (SCO) audited the costs claimed by the City of San Jose for the legislatively mandated Domestic Violence Arrest Policies and Standards Program for the period of July 1, 2018, through June 30, 2021. The city claimed $619,419 for costs of the mandated program. Our audit found that $529,478 is allowable and $89,941 is unallowable. The costs are unallowable because the city overstated salary and benefit costs, and related indirect costs. The State paid the city $616,866. Background Penal Code (PC) section 13701, subdivision (b) (added by Chapter 246, Statutes of 1995), required local law enforcement agencies to develop, adopt, and implement written arrest policies for domestic violence offenders by July 1, 1996. The legislation also required local law enforcement agencies to obtain input from local domestic violence agencies when developing the arrest policies. Under previous law, local law enforcement agencies were required to develop, adopt, and implement written policies for response to domestic violence calls and were encouraged, but not obligated, to consult with domestic violence experts. On September 25, 1997, the Commission on State Mandates (Commission) determined that Chapter 246, Statutes of 1995, imposed a state mandated program reimbursable under Government Code (GC) section 17561. The program’s parameters and guidelines establish the state mandate and define the reimbursement criteria. The Commission adopted the parameters and guidelines on August 20, 1998, and amended them on October 30, 2009. In compliance with GC section 17758, the SCO issues the Mandated Cost Manual for Local Agencies (Mandated Cost Manual) to assist local agencies in claiming mandated program reimbursable costs. Audit Authority We conducted this performance audit in accordance with GC sections 17558.5 and 17561, which authorize the SCO to audit the city’s records to verify the actual amount of the mandated costs. In addition, GC section 12410 provides the SCO with general authority to audit the disbursement of state money for correctness, legality, and sufficient provisions of law for payment. Objective, Scope, The objective of our audit was to determine whether claimed costs represent increased costs resulting from the legislatively mandated and Methodology Domestic Violence Arrest Policies and Standards Program. Specifically, we conducted this audit to determine whether claimed costs were supported by appropriate source documents, were not funded by another source, and were not unreasonable and/or excessive. Unreasonable and/or excessive costs include ineligible costs that are not identified in the program’s parameters and guidelines as reimbursable costs. -1- City of San Jose Domestic Violence Arrest Policies and Standards Program The audit period was July 1, 2018, through June 30, 2021. To achieve our objective, we performed the following procedures: • We reviewed the annual mandated cost claims filed by the city for the audit period and identified the significant cost components of each claim as salaries and benefits, and related indirect costs. We then determined whether there were any errors or unusual unexpected variances from year to year. We reviewed the claimed activities to determine whether they adhered to the SCO’s Mandated Cost Manual and the program’s parameters and guidelines. • We completed an internal control questionnaire by interviewing key city staff members. We discussed the claim preparation process with city staff members to determine what information was obtained, who obtained it, and how it was used. • We assessed the reliability of the data (payroll and expenditure records) generated from the city’s information management system and the city’s record management system (RMS) by interviewing city staff members and examining supporting documentation. We determined that the data was sufficiently reliable to address the audit objectives. • We verified that the city used the uniform time allowance and applied it properly. • We reviewed and analyzed the claimed domestic violence incident report counts and verified that these counts were supported by the city’s RMS; see Finding 1. • We used simple random sampling to select the following statistical samples from the audited population of incident reports: o We sampled 145 of 4,257 incident reports for fiscal year (FY) 2018-19. o We sampled 143 of 3,159 incident reports for FY 2019-20. o We sampled 145 of 4,397 incident reports for FY 2020-21. • We determined whether the sampled incident reports included interviews with both parties involved in the domestic violence incident, and whether the officer considered the 17 factors listed in the parameters and guidelines to identify the primary aggressor. We identified the following errors: o Of the 145 sampled incident reports for FY 2018-19, 48 were partially reimbursable and 44 were non-mandate-related. o Of the 143 sampled incident reports for FY 2019-20, 47 were partially reimbursable and 17 were non-mandate-related. o Of the 145 sampled incident reports for FY 2020-21, 41 were partially reimbursable and 43 were non-mandate-related. Errors found were projected to the intended (total) population; see Finding 2. • We recalculated the allowable costs using the audited incident report counts. -2- City of San Jose Domestic Violence Arrest Policies and Standards Program • We interviewed city staff members to determine what employee classifications were involved in performing the mandated activities during the audit period. • We traced the average productive hourly rate calculations for the claimed employee classification to supporting information in the city’s payroll system. • We traced the benefit rate calculations for the claimed employee classification to the city’s expenditure reports. • We verified that indirect costs claimed for each fiscal year in the audit period were for common or joint purposes, and that the indirect cost rates were properly supported and applied. • We inquired with city staff members, reviewed the independent auditor’s reports (with accompanying financial statements), and reviewed revenue reports to identify potential sources of offsetting revenues and reimbursements for the audit period. We determined that the claimed costs were not funded by another source. We did not audit the city’s financial statements. We conducted this performance audit in accordance with generally accepted government auditing standards. Those standards required that we plan and perform the audit to obtain sufficient, appropriate evidence to provide a reasonable basis for our findings and conclusions based on our audit objective. We believe that evidence obtained provides a reasonable basis for our findings and conclusions based on our audit objective. Conclusion As a result of performing the audit procedures, we found instances of noncompliance with the requirements described in our audit objective. We did not find that the city claimed costs that were funded by other sources; however, we found that it claimed unsupported and ineligible costs, as quantified in the Schedule and described in the Findings and Recommendation section. For the audit period, the City of San Jose claimed $619,419 for costs of the legislatively mandated Domestic Violence Arrest Policies and Standards Program. Our audit found that $529,478 is allowable and $89,941 is unallowable. The State paid the city $616,866. Following issuance of this audit report, the SCO’s Local Government Programs and Services Division will notify the city of the adjustment to its claims via a system-generated letter for each fiscal year in the audit period. Follow-up on The city has not resolved the findings noted in our prior audit report for the period of July 1, 2012, through June 30, 2015, issued on October 20, Prior Audit 2017, as described in Findings 1 and 2. Findings -3- City of San Jose Domestic Violence Arrest Policies and Standards Program Views of We issued the draft audit report on February 14, 2024. The City of San Responsible Jose’s representative responded by letter dated February 23, 2024, acknowledging the audit findings. This final audit report includes the Officials city’s response as an attachment. Restricted Use This audit report is solely for the information and use of the City of San Jose, the California Department of Finance, and the SCO; it is not intended to be, and should not be, used by anyone other than these specified parties. This restriction is not intended to limit distribution of this audit report, which is a matter of public record and is available on the SCO website at www.sco.ca.gov. Original signed by Kimberly Tarvin, CPA Chief, Division of Audits April 29, 2024 -4- City of San Jose Domestic Violence Arrest Policies and Standards Program Schedule— Summary of Program Costs July 1, 2018, through June 30, 2021 -5- C o s t E le m e n ts J u ly 1 , 2 0 1 8 , th ro u g h J u n e 3 0 , 2 0 1 9 D ire c t c o s ts : S a la rie s a n d b e n e fits In d ire c t c o s ts T o ta l d ire c t a n d in d ire c t c o s ts 2 L e s s o ffs e ttin g re v e n u e s a n d re im b u rs e m e n ts T o ta l p ro g ra m c o s ts 3 L e s s a m o u n t p a id b y th e S ta te A m o u n t p a id in e x c e s s o f a llo w a b le c o s ts c la im J u ly 1 , 2 0 1 9 , th ro u g h J u n e 3 0 , 2 0 2 0 D ire c t c o s ts : S a la rie s a n d b e n e fits In d ire c t c o s ts T o ta l d ire c t a n d in d ire c t c o s ts 2 L e s s o ffs e ttin g re v e n u e s a n d re im b u rs e m e n ts S u b to ta l L e s s a llo w a b le c o s ts th a t e x c e e d c o s ts c la im e d T o ta l p ro g ra m c o s ts 3 L e s s a m o u n t p a id b y th e S ta te A m o u n t p a id in e x c e s s o f a llo w a b le c o s ts c la im J u ly 1 , 2 0 2 0 , th ro u g h J u n e 3 0 , 2 0 2 1 D ire c t c o s ts : S a la rie s a n d b e n e fits In d ire c t c o s ts T o ta l d ire c t a n d in d ire c t c o s ts 2 L e s s o ffs e ttin g re v e n u e s a n d re im b u rs e m e n ts T o ta l p ro g ra m c o s ts 3 L e s s a m o u n t p a id b y th e S ta te A m o u n t p a id in e x c e s s o f a llo w a b le c o s ts c la im e 4 e e d d d A c tu a l C o s ts C la im e d $ 1 7 3 ,5 1 7 3 6 ,0 4 9 2 0 9 ,5 6 6 - $ 2 0 9 ,5 6 6 $ 1 3 8 ,6 0 1 2 9 ,2 1 8 1 6 7 ,8 1 9 - 1 6 7 ,8 1 9 - $ 1 6 7 ,8 1 9 $ 2 0 7 ,8 0 7 3 4 ,2 2 7 2 4 2 ,0 3 4 - $ 2 4 2 ,0 3 4 A llo w a b le p e r A u d it $ 1 3 7 ,9 8 2 2 8 ,6 6 7 1 6 6 ,6 4 9 - 1 6 6 ,6 4 9 (2 0 9 ,5 6 6 ) $ (4 2 ,9 1 7 ) $ 1 4 9 ,1 6 1 3 1 ,4 4 4 1 8 0 ,6 0 5 - 1 8 0 ,6 0 5 (1 2 ,7 8 6 ) 1 6 7 ,8 1 9 (1 6 7 ,8 1 9 ) $ - $ 1 6 7 ,4 3 3 2 7 ,5 7 7 1 9 5 ,0 1 0 - 1 9 5 ,0 1 0 (2 3 9 ,4 8 1 ) $ (4 4 ,4 7 1 ) A u d it A d ju s tm e n t $ (3 5 ,5 3 5 ) (7 ,3 8 2 ) (4 2 ,9 1 7 ) - $ (4 2 ,9 1 7 ) $ 1 0 ,5 6 0 2 ,2 2 6 1 2 ,7 8 6 - 1 2 ,7 8 6 (1 2 ,7 8 6 ) $ - $ 1 2 ,7 8 6 $ (4 0 ,3 7 4 ) (6 ,6 5 0 ) (4 7 ,0 2 4 ) - $ (4 7 ,0 2 4 ) F F F F F F in in in in in in R d d d d d d e fe re n c e in g s 1 , 2 in g s 1 , 2 in g s 1 , 2 in g s 1 , 2 in g s 1 , 2 in g s 1 , 2 ¹ City of San Jose Domestic Violence Arrest Policies and Standards Program Schedule (continued) -6- C o s t E le m e n ts S u m m a ry : J u ly 1 , 2 0 1 8 , th ro u g h J u n e 3 0 , 2 0 2 D ire c t c o s ts : S a la rie s a n d b e n e fits In d ire c t c o s ts T o ta l d ire c t a n d in d ire c t c o s ts 2 L e s s o ffs e ttin g re v e n u e s a n d re im b u rs e m e n ts S u b to ta l L e s s a llo w a b le c o s ts th a t e x c e e d c o s ts c la im e d T o ta l p ro g ra m c o s ts 3 L e s s a m o u n t p a id b y th e S ta te A m o u n t p a id in e x c e s s o f a llo w a b le c o s ts c la im 1 4 e d A c tu a l C o s ts C la im e d $ 5 1 9 ,9 2 5 9 9 ,4 9 4 6 1 9 ,4 1 9 - 6 1 9 ,4 1 9 - $ 6 1 9 ,4 1 9 A llo w a b le p e r A u d it $ 4 5 4 ,5 7 6 8 7 ,6 8 8 5 4 2 ,2 6 4 - 5 4 2 ,2 6 4 (1 2 ,7 8 6 ) 5 2 9 ,4 7 8 (6 1 6 ,8 6 6 ) $ (8 7 ,3 8 8 ) A u d it A d ju s tm e n t $ (6 5 ,3 4 9 ) (1 1 ,8 0 6 ) (7 7 ,1 5 5 ) - (7 7 ,1 5 5 ) (1 2 ,7 8 6 ) $ (8 9 ,9 4 1 ) F F R e fe re n in d in g s 1 in d in g s 1 1 c e , 2 , 2 _________________________ 1 See the Findings and Recommendations section. 2 We determined that the claimed costs were not funded by any other sources. 3 Payment amount current as of February 27, 2024. 4 GC section 17568 stipulates that the State will not reimburse any claim more than one year after the filing deadline specified in the SCO’s claiming instructions. That deadline has expired for FY 2019-20. City of San Jose Domestic Violence Arrest Policies and Standards Program Findings and Recommendations The city claimed $519,925 in salaries and benefits for the Implementation of the New Domestic Violence Arrest Policies to Identify the Primary Aggressor cost component during the audit period. We found that the city understated salaries and benefits by $172,971. The related indirect costs total $33,498, for a total finding of $206,469. For the audit period, the city’s claims identified a total of 8,857 domestic violence incident reports (3,123 for FY 2018-19; 2,324 for FY 2019-20; and 3,410 for FY 2020-21). During testing, the city provided, at our request, the summary incident report listings generated by the city’s RMS to support the number of domestic violence incident reports claimed for the audit period. We compared the information in the summary incident report listings generated by the city’s RMS with the number of domestic violence incident reports that the city claimed. Based on our review, we found that the city understated the number of domestic violence incident reports claimed for the audit period. The city understated the number of reports because it did not adhere to the program’s parameters and guidelines or the SCO’s Mandated Cost Manual. The following table summarizes the audit adjustment for the understated number of incident reports: -7- N u m b e r o f d o m e s tic v io le n c e in c id e n t re p o rts p e r R M S L e s s n u m b e r o f d o m e s tic v io le n c e in c id e n t re p o rts c la im e d U n d e rs ta te d n u m b e r o f d o m e s tic v io le n c e in c id e n t re p o rts U n ifo rm tim e a llo w a n c e (h o u rs ) U n d e rs ta te d h o u rs C la im e d p ro d u c tiv e h o u rly ra te - s a la rie s o n ly U n d e rs ta te d s a la rie s [A ] C la im e d b e n e fit ra te U n d e rs ta te d b e n e fits [B ] U n d e rs ta te d s a la rie s a n d b e n e fits [C ] = [A + B C la im e d in d ire c t c o s t ra te [D ] 1 R e la te d in d ire c t c o s ts [E ] = [A x D ] A u d it A d ju s tm e n t [F ] = [C + E ] ¹ R e la te d in d ire c t c o s ts w e re c o m p u te d u s in g ] s a la 2 0 1 8 -1 9 4 ,2 5 (3 ,1 2 1 ,1 3 x 0 .4 5 4 x $ 6 4 .1 3 4 ,9 0 x 8 0 .4 1 2 8 ,0 6 6 2 ,9 6 x 3 7 .4 8 1 3 ,0 8 $ 7 6 ,0 5 rie s o n ly . 7 3 48 46 3% 6 9% 2 1 ) F is c a l Y e a r 2 0 1 9 -2 0 3 ,1 5 (2 ,3 2 8 3 x 0 .4 4 0 x $ 6 6 .2 2 6 ,5 8 x 8 7 .4 3 2 3 ,2 4 4 9 ,8 2 x 3 9 .5 1 1 0 ,5 0 $ 6 0 ,3 2 9 4 58 19 2% 1 3% 3 6 ) 2 0 2 0 -2 1 4 ,3 9 (3 ,4 1 9 8 x 0 .4 4 7 x $ 6 6 .9 3 1 ,7 2 x 8 9 .7 2 2 8 ,4 5 6 0 ,1 7 x 3 1 .2 5 9 ,9 1 $ 7 0 ,0 9 7 0 78 42 0% 9 9% 3 2 ) T o ta l $ 1 7 2 ,9 3 3 ,4 $ 2 0 6 ,4 7 9 6 1 8 9 FINDING 1— Understated costs (Repeat Finding) Section IV, “Reimbursable Activities,” of the parameters and guidelines begins: To be eligible for mandated cost reimbursement for any fiscal year, only actual costs may be claimed. Actual costs are those costs actually incurred to implement the mandated activities. Actual costs must be traceable and supported by source documents that show the validity of City of San Jose Domestic Violence Arrest Policies and Standards Program such costs, when they were incurred, and their relationship to the reimbursable activities. A source document is a document created at or near the same time the actual cost was incurred for the event or activity in question. Source documents may include, but are not limited to, employee time records or time logs, sign-in sheets, invoices, and receipts. . . . The claimant is only allowed to claim and be reimbursed for increased costs for reimbursable activities. . . . Increased cost is limited to the cost of an activity that the claimant is required to incur as a result of the mandate. Section IV.E, “Uniform Cost Allowance,” of the parameters and guidelines states: Pursuant to Government Code section 17557, the Commission on State Mandates has adopted a uniform cost allowance for reimbursement in lieu of payment of total actual costs incurred. The uniform cost allowance is applied only to Section IV, Reimbursable Activities, Component D (Implementation of the New Domestic Violence Arrest Policies to Identify the Primary Aggressor) and covers all costs (direct and indirect) of performing activities described under Component D. The uniform cost allowance provides the following: A standard time of twenty-nine (29) minutes may be claimed to identify the primary aggressor in any domestic violence incident. The standard time of twenty-nine (29) minutes is broken down as follows: • Seventeen (17) Minutes – Interview of both parties • Twelve (12) Minutes – Consideration of the factors listed [under Component D] The total cost will be determined by multiplying the number of reported responses × the average productive hourly rate, including applicable indirect costs as specified in section V., paragraph B, herein, × .48 (29 minutes divided by 60 minutes). Recommendation We recommend that the city: • Follow the program’s parameters and guidelines and the SCO’s Mandated Cost Manual when preparing its reimbursement claims; and • Claim costs based on the number of domestic violence incidents that its RMS supports. City’s Response . . . We have reviewed the findings of the audit and acknowledge the discrepancies identified in our claimed costs. We understand the importance of adhering to the program's parameters and guidelines and acknowledge the discrepancies made in our reimbursement claims. . . . We agree with the conclusion reached by the State Controller’s Office regarding the understated and non-reimbursable costs identified in our claimed expenses, except for the disallowed costs that exceeded the -8- City of San Jose Domestic Violence Arrest Policies and Standards Program claimed costs in fiscal year 2019-2020. Based on the results of the audit, the City incurred actual costs greater than the amount claimed under the Domestic Violence Arrest Policies and Standards Program in fiscal year 2019-2020. While Government Code section 17568 stipulates that the State will not reimburse any claim more than one year after the filing deadline, it seems one-sided to only apply the audit adjusted results when it works to reduce costs reimbursed by the State. As defined in Government Auditing Standards, auditors should perform audits with objectivity, which includes maintaining independence and impartiality. Therefore, audits performed with impartiality in accordance with Government Auditing Standards, should result in fairly applying audit adjustments regardless of whether the adjustment results in reduced or increased claimed costs. With a shared goal of ensuring accuracy in the claimed costs, we request you reconsider disallowing the underclaimed amount for fiscal year 2019-2020 and apply a credit to offset the other fiscal years audited. SCO Comment Our finding and recommendation remains unchanged. The city disagrees with the adjustment made to total allowable costs that were in excess of the total amount claimed in FY 2019-20. The adjustment made to FY 2019-20 is legal and proper. The city is not entitled to reimbursement for costs that it did not claim. Furthermore, as the city recognizes in its response, GC section 17568 stipulates that the State will not reimburse any claim more than one year after the filing deadline specified in the SCO’s Mandated Cost Manual. The deadline for the city to amend its claim for FY 2019-20 has expired. Therefore, the costs that were determined to be in excess of the total amount claimed in FY 2019-20 is ineligible for reimbursement and may not be applied as an offset to audit adjustments made in FY 2018-19 or FY 2020-21. FINDING 2— The city claimed non-reimbursable salaries and benefits totaling $238,320. The related indirect costs total $45,304, for a total finding of $283,624. Non-reimbursable costs (Repeat Finding) As noted in Finding 1, the city understated the claimed number of domestic violence incident reports for the audit period. The following table summarizes the audited population of incident reports and the claimed hours attributable to the audited population: Fiscal Year 2018-19 2019-20 2020-21 Documented number of domestic violence incident reports (audited population) 4,257 3,159 4,397 Uniform time allowance (hours) 0.48 0.48 0.48 Total hours attributable to documented incident reports (audited population) 2,043 1,516 2,111 The reimbursable activities for this cost component consist of interviewing both parties involved in the domestic violence incident, and considering the 17 factors identified in the program’s parameters and guidelines to identify the primary aggressor. -9- City of San Jose Domestic Violence Arrest Policies and Standards Program To calculate the claimed costs, the city multiplied the number of reported responses to incidents by the average productive hourly rate, including the applicable indirect costs, then multiplied the resulting amount by the standard time allowed of 29 minutes (0.48 hours). For each fiscal year, we selected a statistical sample from the documented number of domestic violence incident reports (the audited population) based on a 95% confidence level, a precision rate of ±8%, and an expected error rate of 50%. We used statistical samples so that the results could be projected to the population for each fiscal year. For testing purposes, we selected a random sample of 433 incident reports (145 for FY 2018-19; 143 for FY 2019-20; and 145 for FY 2020-21). We reviewed the sample incident reports to determine whether the city had performed the required mandated program activities. Our review found the following results: • 193 incident reports were fully reimbursable under the mandated program. These reports are reimbursable at 29 minutes (0.48 hours) per report. • 136 incident reports were partially reimbursable, because the officers did not interview both parties involved in the domestic violence incident. These reports are reimbursable at 20.5 minutes (0.34 hours) per report, based on 8.5 minutes to interview one party and 12 minutes to consider the various factors identified in the program’s parameters and guidelines. • 104 incident reports were not reimbursable because they were not mandate-related. The incidents did not meet the definition of domestic violence provided in PC section 13700. The incidents were related to violation of a restraining order, harassing and/or annoying text messages, or verbal arguments; and the relationships between individuals did not satisfy the criteria described in PC section 13700(b). During testing, we found that the city had claimed the entire standard time of 29 minutes for incident reports that were only partially reimbursable and claimed reimbursement for ineligible incident reports. The city overstated these costs because it did not claim costs in accordance with the program’s parameters and guidelines or the SCO’s Mandated Cost Manual. The following table summarizes the results of the statistical samples: Fiscal Year 2018-19 2019-20 2020-21 Total Allowable incident reports 5 3 7 9 6 1 1 93 Partially reimbursable incident reports 4 8 4 7 4 1 1 36 (only one party interviewed) Non-mandate-related incident reports 4 4 1 7 4 3 1 04 Total reports sampled 145 143 145 433 -10- City of San Jose Domestic Violence Arrest Policies and Standards Program The following table summarizes the unallowable hours based on the results of the statistical samples by fiscal year: Fiscal Year 2018-19 2019-20 2020-21 Total Allowable incident reports 53 79 61 193 Uniform time allowance (hours) x 0.48 x 0.48 x 0.48 Subtotal [A] 25 38 29 Partially reimbursable incident reports (only one party interviewed) 48 47 41 136 Allowable uniform time allowance (hours) x 0.34 x 0.34 x 0.34 Subtotal [B] 16 16 14 Total reimbursable hours for sampled reports [C] = [A + B] 41 54 43 Statistical sample size ÷ 145 ÷ 143 ÷ 145 Reimbursable hours per report 0.28 0.38 0.30 Documented number of domestic violence incident reports (audited population) x 4,257 x 3,159 x 4,397 Total reimbursable hours 1,192 1,200 1,319 Less hours attributable to audited population (2,043) (1,516) (2,111) Total unallowable hours (851) (316) (792) The following table summarizes unallowable costs based on the unallowable hours identified in the statistical samples by fiscal year: -11- U n a llo w a b le h o u rs C la im e d a v e ra g e p ro d u c tiv e h o u rly ra te (s a la ry ) U n a llo w a b le s a la rie s [A ] C la im e d b e n e fit ra te R e la te d u n a llo w a b le b e n e fit c o T o ta l u n a llo w a b le s a la rie s & b [C ] = [A + B ] C la im e d in d ire c t c o s t ra te R e la te d in d ire c t c o s ts [D ] A u d it a d ju s tm e n t [E ] = [C + D s ts [B ] e n e fits ] x x x 2 0 1 8 -1 9 (8 5 $ 6 4 .1 (5 4 ,6 0 8 0 .4 1 (4 3 ,9 0 (9 8 ,5 0 3 7 .4 8 (2 0 ,4 6 $ (1 1 8 ,9 6 1 6 0% 4 4 % 4 8 ) ) ) ) ) ) x x x F is c a l Y e a r 2 0 1 9 -2 0 (3 1 $ 6 6 .2 (2 0 ,9 4 8 7 .4 3 (1 8 ,3 1 (3 9 ,2 6 3 9 .5 1 (8 ,2 7 $ (4 7 ,5 4 6 9 8% 5 3 % 7 0 ) ) ) ) ) ) x x x 2 0 2 0 -2 1 (7 9 $ 6 6 .9 (5 3 ,0 0 8 9 .7 2 (4 7 ,5 5 (1 0 0 ,5 5 3 1 .2 5 (1 6 ,5 6 $ (1 1 7 ,1 1 2 2 1% 2 3 % 3 6 ) ) ) ) ) ) T o ta $ (2 3 8 (4 5 $ (2 8 3 l ,3 ,3 ,6 2 0 2 0 4 4 ) ) ) Section IV, “Reimbursable Activities,” of the parameters and guidelines begins: To be eligible for mandated cost reimbursement for any fiscal year, only actual costs may be claimed. Actual costs are those costs actually incurred to implement the mandated activities. Actual costs must be traceable and supported by source documents that show the validity of such costs, when they were incurred, and their relationship to the reimbursable activities. A source document is a document created at or near the same time the actual cost was incurred for the event or activity in question. Source documents may include, but are not limited to, employee time records or time logs, sign-in sheets, invoices, and receipts. . . . City of San Jose Domestic Violence Arrest Policies and Standards Program The claimant is only allowed to claim and be reimbursed for increased costs for reimbursable activities. . . . Increased cost is limited to the cost of an activity that the claimant is required to incur as a result of the mandate. Section IV, E, “Uniform Cost Allowance,” of the parameters and guidelines states: Pursuant to Government Code section 17557, the Commission on State Mandates has adopted a uniform cost allowance for reimbursement in lieu of payment of total actual costs incurred. The uniform cost allowance is applied only to Section IV, Reimbursable Activities, Component D (Implementation of the New Domestic Violence Arrest Policies to Identify the Primary Aggressor) and covers all costs (direct and indirect) of performing activities described under Component D. The uniform cost allowance provides the following: A standard time of twenty-nine (29) minutes may be claimed to identify the primary aggressor in any domestic violence incident. The standard time of twenty-nine (29) minutes is broken down as follows: • Seventeen (17) Minutes – Interview of both parties • Twelve (12) Minutes – Consideration of the factors listed [under Component D] The total cost will be determined by multiplying the number of reported responses × the average productive hourly rate, including applicable indirect costs as specified in section V., paragraph B, herein, × .48 (29 minutes divided by 60 minutes). Recommendation We recommend that the city: • Follow the program’s parameters and guidelines and the SCO’s Mandated Cost Manual when preparing its reimbursement claims; • Claim costs based on the number of domestic violence incidents that its RMS supports; • Claim costs for only those reports that document incidents meeting the definition of domestic violence provided in PC section 13700; and • Claim only the portion of the uniform time allowance that is attributable to the mandated activities performed. City’s Response The city did not respond separately to Finding 2. The city’s response to Findings 1 and 2 is reproduced in Finding 1, and the city’s complete response is included as an attachment to this report. SCO Comment Our finding and recommendation remains unchanged. Our comment on the city’s response appears in Finding 1. -12- City of San Jose Domestic Violence Arrest Policies and Standards Program Attachment— City’s Response to Draft Audit Report State Controller’s Office Division of Audits Post Office Box 942850 Sacramento, CA 94250 www.sco.ca.gov S22-MCC-0019