EXPENDITURES OUT OF CONTROL By Linda Sutter – August 18, 2022 The Crescent City Harbor District is in grave reprehensible repair. In their most recent published audit report conducted by Stephen Denny it was determined there has been no oversight, no transparency, and the financial reports in the meeting materials do not reflect the Harbor Districts transactions. The first paragraph of the report states: “The Harbor District is not compliant with the California Public Records Act. The Enterprise Systems Catalog is outdated. The Financial transparency page does not contain financial reports. The financial reports in the meeting materials do not reflect the Harbor District’s financial transactions and account balances in its general ledger.” Additionally, the report goes onto say, “The Harbor District does not reconcile aged receivables with the general ledger, correct transactions recorded erroneously as receivables, nor write off aged receivables balances in a timely manner. As a result, the Harbor District’s account balances are misstated for the current and prior fiscal years (e.g., revenue/expense balances overstated/understated).” Lastly, the report goes on to state, “The Harbor District lacks proper oversight and accountability of accounting and financial reporting requirements. Required tasks are not properly tracked or followed up on enabling tasks to become forgotten or deadlines to be missed (e.g., annual financial reports to SLC, audit response, annual inventories).” How do you like that report thus far? But wait, it isn’t over yet. Now the state Controller’s office is getting involved, “The Harbor District is at risk of being non-compliant with the State of California Government Code § 53891 for FY2020/2021 that mandates submission to the State Controller’s Office (SCO) within seven months of fiscal year end the Special Districts Financial Transactions Report (FTR) containing data from the audited financial statements.” “The Harbor District is in violation of Public Resources Code § 6306 for failing to comply with the State Lands Commission (SLC) reporting requirements for FY2018/ 2019 and FY2019/2020. The Harbor District is at risk of being non-compliant for the fiscal year that ended June 30, 2021 (FY2020/2021) with annual reports due at the end of the calendar year.” And, this, “The Harbor District has not completed its FY2019/2020 audit 18 months after the fiscal year ended and is at risk of being non-compliant with government reporting standards for the prior fiscal year (FY2020/2021).” “The Harbor District does not have or is unable to deliver documented accounting policies and procedures. The district does not have documented processes for month-end/year-end close, expense and revenue recognition, reconciliations, collections, recordkeeping, asset management, inventory, and depreciation.” During the Meeting of August 16, 2022, It was noted the Harbor District is approximately $26,000.00 dollars in the red. That is according to the Comptroller that has been assigned to this district due to their noncompliance with the State Controller. So what do the Commissioners do during the meeting? They voted to spend $25,000.00 for a grant application and voted to allow the Harbor Master to attend a week long meeting in Santa Barbara where the Harbor Master, Tim Petrick was allocated by Harry Adams $400.00 dollars per night for a Hotel. When the public questioned that amount Harry Adams response was, “Well it’s Santa Barbara.” According to California State Reimbursements for travel and food, a manager or County worker is entitled to $250.00 per day for a Hotel in certain areas of the state, such as San Jose and San Francisco, mileage is now at 62.5 cents per mile. Mr. Petrick indicated he would be driving. Meals are $7.00 for breakfast, $11.00 for lunch, and $23.00 dollars for dinner. Incidentals are 5.00 dollars per day. The mileage to get to Santa Barbara one way will cost $422.85. Mr. Petrick is allocated $3,500.00 per year for training purposes. The current elected have failed the harbor and allowed sharks such as Alex Lemus to breeze in. The Harbor Commissioners did not indicate to the public how they would recover the $25,000.00 dollars they are in the red for. Nor did they disclose where the $25,000 dollars was coming from to spend on a grant.