Budget, Budget, Who’s Got The Budget?

It all seemed so simple: We would sit down with top County leaders fresh into the new year and a new term of office, to get their views on the big-ticket issues facing the county, and opportunities to address those problems.  We would do it during a relative lull in the steady drumbeat of natural disasters that take their eyes off the long game.  But as often happens in the strange looking-glass world of Mendocino County, instead of hearing about new water projects and transportation infrastructure, or plans to preserve more forest land, the conversation was hijacked by the latest crisis – the crisis du jour in Ukiah, a familiar story line in these parts.  Some days it seems as though that crisis is all that happens in county government.  

Only this time it was not a natural disaster or earthquake.  It was a firestorm alright, but it was lit up by and swirling around Chamise Cubbison, the elected County Auditor.  She had figuratively lit her hair on fire and run across State Street by her failure, more than a year and a half into her job, to do her job.  Or at least the essential functions of that job, namely audit the county financial books.  

Of course, things are not presented that crisply in the county building, where the wording can be about as clear as a glass of Mendo Mud.  But Chamise Cubbison, and her performance in her job function (or lack thereof) is the white elephant in the room that nobody’s talking about; and the single thing occupying most time and thought and energy in County administrative offices.

Here are some of the facts: 

• As we go to press in late February, more than nine months since the close of the last fiscal year (06/30/2022), no audit of that year has been produced (the audit is typically completed and available to leaders and the public by Labor Day) 
• A budget for the current fiscal year (07/01/2022-23 – that’s the one we’re in right now) was proposed, debated and adopted by the Board of Supervisors all without ever knowing what the actual spending results were from the past year.  This is because Chamise Cubbison had not performed the Audit and made it available prior to the deadline – set by state law – for the Board to adopt the new budget.  Thus they had to adopt the budget for FY 2022-23 in the dark, without an audit of the results of last years’ finances. This had never before happened in county history.
• The fact that Mendocino County is well over halfway into its current budget and expense cycle, with department heads and county leaders spending money – tax revenue – without any knowledge of current financial information – a “balance sheet”.  This means money is being spent blindly; it is akin to a person writing checks out of an account for over 6 months without ever knowing how much is in that account.  That would be crazy.  That would be a crime.

We planned to interview all the leaders of Mendocino County for this series, and most all of them responded and were generous with their time, including:

• Mendocino County Chief Executive Officer Darcy Antle
• Sheriff Matthew Kendall
• Registrar-Recorder Katrina Bartolomie
• Supervisors Maureen Mulheren and Ted Williams
• Public Safety Advisory Board Member Lee Finney

Interestingly, the person with the most  knowledge of the budget process and why it is not forthcoming – the County Auditor Chamise Cubbison – was one of only two people that did not respond to a request for an interview.  In fact she did not respond to several requests.  

Neither did District Attorney David Eyster, who apparently does not deign to engage with either the public or the press. The staffer that answers Eyster’s phone informed a caller that the District Attorney “could not be reached” and that he “didn’t have an email address.”  

While some leaders were no-shows, other people stepped forward unexpectedly and provided crucial insight.  Chief among these is Lloyd Weer, the recently retired (September 2021) former Auditor of the County – Ms. Cubbbison’s direct predecessor.

Mr. Weer said that no other reporter had ever reached out to him; a fact he found surprising, what with all the controversy and all.  But your intrepid reporter tracked him down; (it wasn’t that hard actually) and found Mr. Weer more than willing to share on selected topics in the public square.

But before we get further into the details of the current fiasco, it might be helpful to step back outside Ukiah to try to put everything into context. Into a Mendocino County context.  A very useful grid to help understand this county can be made by intersecting the sage wisdom of two county leaders interviewed for this story:

Supervisor Ted Williams:  “Mendocino County is huge geographically – three times larger than Rhode Island – with a tiny population (the total county population of 90,000 is only half the size of the City of Santa Rosa).”  And those 90,000 people are sparsely settled in isolated areas, strung out in a spider’s web of roads that traverse rugged terrain. Yet residents often expect – and demand big-city-style government service delivery.  “We are a place with high demand for government services and very limited revenue streams.”

Sheriff Matt Kendall:  “You can’t understand this place without three key concepts:  Guns, gravity and greed.”

And to understand the current budget scandal, it is important to clarify a few financial concepts and definitions.  As noted, the county operates on a budget, a financial document that outlines spending and income for the year.  The current budget generally takes shape from last year’s template.  County officials evaluate results of the last budget by looking at the audit. Then department heads make necessary changes, additions and deletions for the coming year.  The proposed budget is then debated and finally adopted by the Board of Supervisors.  The County budget runs off the Fiscal Year calendar, from 07/01 to 06/30.  

The budget forms the basis for the “books” , the financial statement or summary of audited amounts that is just like a checkbook register.   Knowing how much is in there, how much is coming in and going out, and when, is obviously crucial to prudent financial operations.  Informed, accurate financial data is foundational to government and corporate finance, and negligent – possibly criminal – to operate in the blind.
Ted Williams, who represents the 5th District on the Mendocino County Board of Supervisors (basicly the southwest section of the County) is reserved and almost professorial in his bearing.  He could hardly be described as an extremist; yet he seems relentless in his focus on this budget issue:  The absence of financial information from the County Auditor is “shocking” to him and “puts the County in a position of extreme vulnerability”.  He has been quite vocal in pursuit of an audited balance sheet, the current monthly running total of where the county revenue and spending is, as compared with budgeted and closed audited books on prior periods and fiscal years such as 2020. 

This seems a reasonable request.  Indeed it is pretty much standard operating procedure in government, business and personal finance.  Sort of “Basic Finance 101”. The person tasked with developing these products is the elected County Auditor, Chamise Cubbison.

We began our interviews with high hopes in mid-January.  Darcy Antle was first on our list.  Ms. Antle is the Chief Executive Officer of Mendocino County, fairly new to her role, coming up on a year in the post. Her background is in finance and healthcare administration. She has a lot of experience with budgets. Our entire interview was consumed with her efforts and frustrations since joining the county in 2019 to bring County budget and accounting systems into the current technology or at least the current century. She’s been working hard at it by her accounts.

Ms. Antle was quite clear and forthright in her views, though she was careful, almost cautious in her phrasing.  She said it was “unprecedented” in her 20-plus year career in financial administration to produce a budget for a given period of time without the results of the last budget.  It is “unprecedented” to be spending money in a current period without auditing and closing the prior period.  Without current balance sheets, “it’s impossible to say where we are in time and space.”  

It would seem to be spending money without knowing what’s in the bank account.  But that’s exactly what’s happening. “Unprecedented.”

She started at the County in 2019 in the Executive Department and began what she calls the “budget initiative”.  Iit comprises a set of ideas and hardware that would bring systems into current technology.  We are now four years into the “initiative”.  How is it going?   “It is” says Ms. Antle, “not completed yet. We are having some difficulties getting on the same page.”

She sounded some ominous notes:

• There are significant “health plan liabilities” for the huge county workforce that are growing, but no one is sure by how much.
• There are “cost overruns on the jail.”
• Federal disaster recovery funding has gone missing or is “unaccounted.”
• The county has lost grant funding because it could not meet basic financial reporting criteria.

It’s hard to overstate just how much interference this budget information gap is causing.

We can only surmise Ms. Cubbison’s thoughts because she steadfastly ducked all interview requests, and declined comment.  

However, a  form of explanation – a defense of sorts – was offered by her predecessor, the former Mendocino County Auditor Lloyd Weer.  In an exclusive series of interviews stretching over several days, Mr. Weer confirmed that:

• He served for 40 years in Mendocino county government, beginning with the DOT and ending in September 2021 with his retirement from the county as elected County Auditor.
• He was one of two County elected leaders to resign their term early and turn their offices over to hand-picked successors (the other is former Sheriff Tom Allman, who resigned only one year into a four-year term in 2019.  Allman’s Undersheriff, Matthew Kendall, assumed the office upon his resignation; Kendall won election to a full term as Sheriff in 2022.)  Interestingly, like Allman, Weer retired “to spend time with grandkids” but almost immediately returned to work, though Weer went back as part-time temp in the Auditor’s Office to help bail out his friend.  Allman took up “resident deputy” status in Southern Humboldt County almost immediately upon his departure from the Mendocino County Sheriff’s office.
• He personally identified Chemise Cubbison as a person capable of taking on his job, he selected Cubbison to be his successor, and he assured the Board of Supervisors – over their objections – that she could do the job.
• While he was Auditor he had no problem in producing the documents in question. (the year-end Fiscal Year audit, and the monthly Balance Sheets) Indeed he said he “never had a problem producing those reports on time” when he had the job; by Labor Day for the FY ending 06/30, and at the end of each month.
• Chamise Cubbison has not done those jobs on time or at all
• He is not certain why she is not performing. He said  “If she’s not getting those (jobs) done, there must be a reason.”  Such as?  “I don’t know – could be new or changed responsibilities, or staffing issues.”  But didn’t he have to deal with all those issues as well during his time?  And don’t all the other leaders and department heads have those same challenges? “Yes.  But there must be a reason.”  But he is “not sure and would not want to speak for her.”
• He still supports her and still believes she can do the job.

Since Cubbison refuses to engage or explain herself to her constituents, and with little apparent leverage to force her to do her job, the bizarre and byzantine methods of the Auditor can only be guessed at.  And a curious waiting game has developed, with everyone knowledgeable about county finances on edge.  Waiting to see when those numbers will be coming.  

Periodically, as if to keep interest high, a teaser emerges from the Auditor’s office, like the email last week informing county leadership that the books had finally been closed for FY 2021-22.  

But there was no document attached.