In a rare rebuke, a City panel last week voted against approving a financial report that included a $2 million transfer from one City fund to another because it believed the City was wrong to allocate the funds this way.
The open space preservation district’s financial accountability and audit panel voted 3-1, with one absence, to reject the report after the City Council approved moving the money from the preservation district’s account to cover a shortfall in the facilities fund.
The shortfall comes from the city using facilities-fund monies to build the Canyon Country Community Center, Councilmember Cameron Smyth said. Smyth said the city finalized the land purchase for the center in 2017.
The panel’s action changes nothing, City spokesperson Carrie Lujan wrote in an email. Mayor Marsha McLean said the City Council’s actions were legal and within the parameters of the bylaws set forth when the open space preservation district was created in 2007. “Just because you don’t like something that was done doesn’t mean it was wrong,” she said.
Still, McLean said, City Manager Ken Striplin and City Attorney Joe Montes will schedule a meeting with the panel “and let them know what the rules are and tell them they were done under the parameters of the open space rules put in place.”
According to panel member Sandra Cattell, City officials repeatedly told the panel that it had to approve the action because it was handled correctly, and then if the panel wanted to discuss it, it was free to do so.
“We were given a phrase — funding gap. We asked, ‘Why $2 million?’ ‘It was a funding gap.’ That sends up a big red flag,” Cattell said. “What if the gap would have been $8 million?”
The City correctly told the panel that ten percent of the land bought with open space funds could be used for active parkland. Cattell said she believes the Community Center is a redevelopment and not part of open space. “That in itself is disturbing to me, that they called it open space,” she said.
Cattell also said the transfer, which made up exactly one sentence in the report, “was kind of hidden.”
“Transparency is missing,” she said. “I don’t want to see the money used this way. I understand this is an important activity center in a park-poor section of the city. It’s a vital need. It’s just wrong how they’re funding it.”
McLean said the panel’s rejection is unprecedented. The closest similar incident came in 2015 when it became public knowledge that the City wanted to use open-space funds to purchase land that was too far outside the city (the limit is three miles). According to McLean and Councilmember Bob Kellar, the City corrected the discrepancy and used different funds to buy the land.
As for this action, McLean said the report had to be, and was approved, by an independent auditor before the Council could approve.
“I’m assuming that all of this was looked at before the decision was made to go ahead and use the money to build the active park at the Community Center,” McLean stated.
Asked why she didn’t check it herself, she responded, “When we receive information that an action is OK to take, we go by what our staff puts forth, and if there’s something wrong with it, then there’s something wrong with it and we’ll need to look at it. As far as I know, this was all done the way it was supposed to have been done, and until something different comes up, that’s what we go by.”
Smyth said he appreciates the panel’s value, and that city staff is providing the members with any additional information they seek. He said he expects the meeting between Striplin, Montes and the panel to take place some day before the Aug. 27 city council meeting. He said the meeting’s purpose would be to “provide clarity.”