Santa Ana City

CITY OF SANTA ANA Audit Report DOMESTIC VIOLENCE ARREST POLICIES AND STANDARDS PROGRAM Chapter 246, Statutes of 1995 July 1, 2017, through June 30, 2021 M M. C ALIA OHEN California State Controller November 2023 MALIA M. COHEN CALIFORNIA STATE CONTROLLER November 20, 2023 CERTIFIED MAIL—RETURN RECEIPT REQUESTED Kathryn Downs, Executive Director Santa Ana Finance and Management Services 20 Civic Center Plaza Santa Ana, CA 92701 Dear Ms. Downs: The State Controller’s Office audited the costs claimed by the City of Santa Ana for the legislatively mandated Domestic Violence Arrest Policies and Standards Program for the period of July 1, 2017, through June 30, 2021. The city claimed $227,307 for costs of the mandated program. Our audit found that $165,969 is allowable and $61,338 is unallowable. The costs are unallowable because the city overstated salary and benefit costs, and related indirect costs. The State paid the city $226,779. 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, 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 Attachment 300 Capitol Mall, Suite 1850, Sacramento, CA 95814 | P.O. Box 942850, Sacramento, CA 94250 | Fax: 916.322.4404 sco.ca.gov Ms. Kathryn Downs November 20, 2023 Page 2 of 2 cc: The Honorable Valerie Amezcua, Mayor City of Santa Ana Susan Gorospe, Administrative Budget Manager Santa Ana Police Department Leo Martinez, Senior Management Analyst Santa Ana Police Department Chris Hill, Principal Program Budget Analyst Local Government Unit California Department of Finance Ted Doan, Finance Budget Analyst Local Government Unit California Department of Finance Daryl Mar, Manager Local Reimbursement Section State Controller’s Office Everett Luc, Supervisor Local Reimbursement Section State Controller’s Office 300 Capitol Mall, Suite 1850, Sacramento, CA 95814 | P.O. Box 942850, Sacramento, CA 94250 | Fax: 916.322.4404 sco.ca.gov City of Santa Ana 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 .......................................................................................... 3 Restricted Use .................................................................................................................... 4 Schedule—Summary of Program Costs .............................................................................. 5 Finding and Recommendation .............................................................................................. 7 Attachment—City’s Response to Draft Audit Report City of Santa Ana Domestic Violence Arrest Policies and Standards Program Audit Report Summary The State Controller’s Office (SCO) audited the costs claimed by the City of Santa Ana for the legislatively mandated Domestic Violence Arrest Policies and Standards Program for the period of July 1, 2017, through June 30, 2021. The city claimed $227,307 for costs of the mandated program. Our audit found that $165,969 is allowable and $61,338 is unallowable. The costs are unallowable because the city overstated salary and benefit costs, and related indirect costs. The State paid the city $226,779. Background Penal Code (PC) section 13701(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 Santa Ana Domestic Violence Arrest Policies and Standards Program The audit period was July 1, 2017, 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 activities claimed 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 traced the average productive hourly rate and benefit rate calculations for the claimed employee classification performing the mandated activities to supporting information in the city’s payroll system. • 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 report management system. • We used simple random sampling to select the following statistical samples from the audited population of incident reports: o We sampled 133 of 1,142 incident reports for fiscal year (FY) 2017-18. o We sampled 132 of 1,116 incident reports for FY 2018-19. o We sampled 127 of 838 incident reports for FY 2019-20. o We sampled 127 of 845 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 133 sampled incident reports for FY 2017-18, 30 were partially reimbursable and 34 were non-mandate-related. o Of the 132 sampled incident reports for FY 2018-19, 43 were partially reimbursable and 29 were non-mandate-related. o Of the 127 sampled incident reports for FY 2019-20, 51 were partially reimbursable and 13 were non-mandate-related. o Of the 127 sampled incident reports for FY 2020-21, 44 were partially reimbursable and 12 were non-mandate-related. Errors found were projected to the intended (total) population; see the Finding. -2- City of Santa Ana Domestic Violence Arrest Policies and Standards Program • We recalculated the allowable costs using the audited incident report counts. • We verified that the indirect costs that were 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, and reviewed the independent auditor’s reports (with accompanying financial statements) to identify potential sources of offsetting revenues and reimbursements for the audit period. We determined that the 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 did find that it claimed unsupported and ineligible costs, as quantified in the Schedule and described in the Finding and Recommendation section. For the audit period, the City of Santa Ana claimed $227,307 for costs of the legislatively mandated Domestic Violence Arrest Policies and Standards Program. Our audit found that $165,969 is allowable and $61,338 is unallowable. The State paid the city $226,779. 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 satisfactorily resolved the finding noted in our prior audit Prior Audit report for the period of July 1, 2001, through June 30, 2004, issued on May 18, 2007. Findings Views of We issued the draft audit report on September 5, 2023. The City of Responsible Santa Ana’s representative responded by letter dated September 13, 2023, concurring with the audit finding. This final audit report includes the city’s Officials response as an attachment. -3- City of Santa Ana Domestic Violence Arrest Policies and Standards Program Restricted Use This audit report is solely for the information and use of the City of Santa Ana, 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 November 20, 2023 -4- City of Santa Ana Domestic Violence Arrest Policies and Standards Program Schedule— Summary of Program Costs July 1, 2017, through June 30, 2021 Actual Costs Allowable Audit Cost Elements Claimed per Audit Adjustment ¹ July 1, 2017, through June 30, 2018 Direct costs – salaries and benefits: Implementation of the New Domestic Violence Arrest Policies to Identify the Primary Aggressor $ 51,797 $ 34,565 $ (17,232) Total direct costs 51,797 34,565 (17,232) Indirect costs 11,270 7,520 ( 3,750) Total direct and indirect costs 63,067 42,085 (20,982) Less offsetting revenues and reimbursements2 - - - Total program costs $ 63,067 42,085 $ (20,982) Less amount paid by the State3 (63,067) Amount paid in excess of allowable costs claimed $ (20,982) July 1, 2018, through June 30, 2019 Direct costs – salaries and benefits: Implementation of the New Domestic Violence Arrest Policies to Identify the Primary Aggressor $ 55,785 $ 38,290 $ (17,495) Total direct costs 55,785 38,290 (17,495) Indirect costs 12,080 8,292 ( 3,788) Total direct and indirect costs 67,865 46,582 (21,283) Less offsetting revenues and reimbursements2 - - - Total program costs $ 67,865 46,582 $ (21,283) Less amount paid by the State3 (67,865) Amount paid in excess of allowable costs claimed $ (21,283) July 1, 2019, through June 30, 2020 Direct costs – salaries and benefits: Implementation of the New Domestic Violence Arrest Policies to Identify the Primary Aggressor $ 36,209 $ 27,917 $ (8,292) Training Officers About New Written Domestic Violence Arrest Policies 8 34 8 34 - Total direct costs 37,043 28,751 ( 8,292) Indirect costs 9,232 7,165 ( 2,067) Total direct and indirect costs 46,275 35,916 (10,359) Less offsetting revenues and reimbursements2 - - - Total program costs $ 46,275 35,916 $ (10,359) Less amount paid by the State3 (46,275) Amount paid in excess of allowable costs claimed $ (10,359) -5- City of Santa Ana Domestic Violence Arrest Policies and Standards Program Schedule (continued) -6- C o s t E le m e n ts 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 : Im p le m e n ta tio n o f th e N e w D o m e s tic V io le n c e A to Id e n tify th e P rim a ry A g g re s s o r T ra in in g O ffic e rs A b o u t N e w W ritte n D o m e s tic V A rre s t P o lic ie s T o ta l d ire c t c o s ts 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 d S u m m a ry : J u ly 1 , 2 0 1 7 , 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 : Im p le m e n ta tio n o f th e N e w D o m e s tic V io le n c e A to Id e n tify th e P rim a ry A g g re s s o r T ra in in g O ffic e rs A b o u t N e w W ritte n D o m e s tic V A rre s t P o lic ie s T o ta l d ire c t c o s ts 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 d rre s t P io le n c rre s t P io le n c o e o e lic lic ie ie s s A c tu a l C o s ts C la im e d $ 3 6 ,8 1 8 2 ,8 4 9 3 9 ,6 6 7 1 0 ,4 3 3 5 0 ,1 0 0 - $ 5 0 ,1 0 0 $ 1 8 0 ,6 0 9 3 ,6 8 3 1 8 4 ,2 9 2 4 3 ,0 1 5 2 2 7 ,3 0 7 - $ 2 2 7 ,3 0 7 A llo w a b le p e r A u d it $ 2 9 ,9 1 8 2 ,8 4 9 3 2 ,7 6 7 8 ,6 1 9 4 1 ,3 8 6 - 4 1 ,3 8 6 (4 9 ,5 7 2 ) $ (8 ,1 8 6 ) $ 1 3 0 ,6 9 0 3 ,6 8 3 1 3 4 ,3 7 3 3 1 ,5 9 6 1 6 5 ,9 6 9 - 1 6 5 ,9 6 9 (2 2 6 ,7 7 9 ) $ (6 0 ,8 1 0 ) A u d it A d ju s tm e n t ¹ $ (6 ,9 0 0 ) - (6 ,9 0 0 ) (1 ,8 1 4 ) (8 ,7 1 4 ) - $ (8 ,7 1 4 ) $ (4 9 ,9 1 9 ) - (4 9 ,9 1 9 ) (1 1 ,4 1 9 ) (6 1 ,3 3 8 ) - $ (6 1 ,3 3 8 ) _________________________ 1 See the Finding and Recommendation section. 2 We determined that the claimed costs were not funded by any other sources. 3 Payment amount current as of September 18, 2023. City of Santa Ana Domestic Violence Arrest Policies and Standards Program Finding and Recommendation FINDING— The city claimed $180,609 in salaries and benefits for the Implementation of the New Domestic Violence Arrest Policies to Identify the Primary Unallowable salaries, Aggressor cost component during the audit period. We found that benefits, and related $130,690 is allowable and $49,919 is unallowable. Unallowable related indirect costs indirect costs total $11,419, for a total finding of $61,338. 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. To calculate its 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 allowance of 29 minutes (0.48 hour). For each fiscal year, we selected a statistical sample from the documented number of domestic violence incident reports (the 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 519 incident reports (133 for FY 2017-18, 132 for FY 2018-19, 127 for FY 2019-20, and 127 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: • Two hundred and sixty-three incident reports were fully reimbursable under the mandated program. These reports are reimbursable at 29 minutes (0.48 hours) per report. • One hundred and sixty-eight 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. • Eighty-eight 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 restraining order violations, harassing and/or annoying text messages, verbal arguments, and physical assault between family members where no domestic violence occurred. During testing, we found that the city had claimed the full time-increment (e.g. 29 minutes) for incidents that were only partially reimbursable, and had also 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. -7- City of Santa Ana Domestic Violence Arrest Policies and Standards Program The following table summarizes the results of the statistical samples: Fiscal Year 2017-18 2018-19 2019-20 2020-21 Total Allowable incident reports 69 60 63 71 263 Partially reimbursable incident reports 30 43 51 44 168 (only one party interviewed) Non-mandate-related incident reports 34 29 13 12 8 8 Total reports sampled 133 132 127 127 519 The following table summarizes the unallowable hours based on the results of the statistical samples by fiscal year: -8- A llo w a b le in c id e n t r e p o r ts U n if o r m tim e a llo w a n c e ( h o u r s ) S u b to ta l [ a ] P a r tia lly r e im b u r s a b le in c id e n t r e ( o n ly o n e p a r ty in te r v ie w e d ) A llo w a b le u n if o r m tim e a llo w a n c S u b to ta l [ b ] T o ta l r e im b u r s a b le h o u r s f o r s a m p le d r e p o r ts [ [ a ] + [ b ] ] S ta tis tic a l s a m p le s iz e R e im b u r s a b le h o u r s p e r r e p o r t N u m b e r o f d o c u m e n te d in c id e n t r e p o r ts T o ta l r e im b u r s a b le h o u r s L e s s h o u r s p e r d o c u m e n te d in c id e n t r e p o r t T o ta l u n a llo w a b le h o u r s p e o r ts ( h o u r s ) × × ÷ × 2 0 1 7 - 1 8 6 0 .4 3 3 0 .3 1 41 0 .3 1 ,1 4 3 ( 5 4 ( 1 8 9 8 3 0 4 0 33 2 2 6 8 3 3 5 ) ) × × ÷ × F is c a 2 0 1 8 - 1 9 6 0 0 .4 8 2 9 4 3 0 .3 4 1 5 4 4 1 3 2 0 .3 3 1 ,1 1 6 3 6 8 ( 5 3 6 ) ( 1 6 8 ) l Y × × ÷ × e a r 2 0 1 9 - 2 0 6 3 0 .4 8 3 0 5 1 0 .3 4 1 7 4 7 1 2 0 .3 7 8 3 8 3 1 ( 4 0 2 ( 9 2 7 0 ) ) × × ÷ × 2 0 2 0 - 2 1 7 1 0 .4 8 3 4 4 4 0 .3 4 1 5 4 9 1 2 0 .3 9 8 4 5 3 3 ( 4 0 6 ( 7 6 7 0 ) ) T o ta 2 1 l 6 6 3 8 City of Santa Ana Domestic Violence Arrest Policies and Standards Program The following table summarizes the unallowable costs based on the unallowable hours identified in the statistical samples by fiscal year: -9- 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 [c ] 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 s ts [d ] T o ta l u n a llo w a b le s a la rie s & b e n e fits [[e ] = [c ] + [d ]] C la im e d in d ire c t c o s t ra te [f] R e la te d in d ire c t c o s ts [[g ] = [f] x [c ]] A u d it a d ju s tm e n t [[h ]= [g ] + [e ]] × × × 2 0 1 7 - 1 8 (1 8 $ 6 0 .3 $ (1 1 ,0 4 5 6 .0 0 (6 ,1 8 (1 7 ,2 3 3 3 .9 5 (3 ,7 5 $ (2 0 ,9 8 3 6 6% 6 2 % 0 2 ) ) ) ) ) ) × × × F 2 0 1 8 - 1 9 (1 6 $ 6 5 .5 $ (1 1 ,0 1 5 8 .8 4 (6 ,4 8 (1 7 ,4 9 3 4 .3 9 (3 ,7 8 $ (2 1 ,2 8 is c 8 ) 6 4 ) % 1 ) 5 ) % 8 ) 3 ) a l Y × × × e a r 2 0 1 9 - 2 0 (9 $ 6 6 .1 $ (6 ,0 8 3 6 .1 8 (2 ,2 0 (8 ,2 9 3 3 .9 5 (2 ,0 6 $ (1 0 ,3 5 2 8 9% 3 2 % 7 9 ) ) ) ) ) ) × × × 2 0 2 0 - 2 1 (7 $ 6 5 .2 $ (4 ,9 5 3 9 .1 9 (1 ,9 4 (6 ,9 0 3 6 .6 0 (1 ,8 1 $ (8 ,7 1 6 2 7% 3 0 % 4 4 ) ) ) ) ) ) T o $ (3 (1 $ (4 (1 $ (6 ta l 3 ,1 6 ,8 9 ,9 1 ,4 1 ,3 0 1 1 1 3 6 3 9 9 8 ) ) ) ) ) Criteria 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. . . . 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, subsection 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 City of Santa Ana Domestic Violence Arrest Policies and Standards Program 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 mandated program’s parameters and guidelines and the SCO’s Mandated Cost Manual when preparing its reimbursement claims; • 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 that were actually performed. City’s Response The city concurred with the audit finding. -10- City of Santa Ana 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 S23-MCC-0001