SACRAMENTO, Calif. - The new director of the state agency that oversees the most beautiful and historic places in California vowed Tuesday to restore the public's trust diminished last summer by revelations of financial mismanagement.
After months of scrutinizing problems at the Department of Parks and Recreation, the joint legislative audit committee grilled the director and state accountants to determine why a secret fund held millions of dollars even as 70 parks were targeted for closure.
"We acknowledge that unfortunate and improper actions occurred and need to be fixed," said Anthony Jackson, a retired Marine Corps major general tapped by Gov. Jerry Brown late last year to turn around the beleaguered department.
Jackson said the department now has a new leadership team in place.
The discovery of the secret $54 million fund was a public relations debacle that came as dozens of volunteer groups were scrambling to raise private funds and form partnerships to keep open most of the parks on the closure list.
Investigations led the state's auditor, controller and department of finance to other management problems, including the fact that decisions were made to close budget gaps without knowing the cost of operating the targeted parks.
Communities across the state depend on visitors to the state's 278 parks to help sustain local economies. Some lawmakers were angry last summer when they couldn't explain to constituents why parks their districts were targeted.
"State agencies simply don't have the right to choose which funds they want to disclose," said Assembly member and audit committee chair Adam Gray, D-Merced. "It is every department's responsibility to be transparent about how they spend taxpayer money."
Audits and investigations ordered by the legislature and governor's office showed that former department heads hid up to $20 million in a State Parks and Recreation Fund and another $34 million in an off-highway vehicle fund.
Investigators found that the Department of Finance had known about the accounts as early as 1999, and sent emails to the parks department asking they be reconciled. Finance never followed up to see whether they had been, state Auditor Elaine Howle told the committee.
"Finance was aware there was a problem and notified DPR, which had a responsibility to reconcile. We didn't see any action subsequent to that," Howle said.
The existence of the accounts was perplexing because the parks department could not have spent the money without legislative authorization, authorities said.
Parks Director Ruth Coleman resigned and a senior department official was fired last summer.
"As a taxpayer and heavy parks user I'm very concerned about what happened, but so far apparently the unique thing is that they were hidden - and not used," said Peter Southworth of the Attorney General's Office, which conducted a civil investigation.
Department officials had said they feared if the funds were discovered, the legislature would further cut the parks department budget, which had been squeezed for years. Over the past decade more than $1 billion in deferred maintenance costs have accrued, and many parks have cut hours and services.
The department has a budget of nearly $574 million in the current fiscal year, which comes from the state general fund, various bond funds, user fees and off-highway vehicle registration fees.
Howle's audit recommended the parks department establish detailed procedures that compare year-end financial statements to ensure that the ending fund balances reported to the governor's budget and state controller's budget are the same.
She also recommended that officials determine how much it costs to fully operate each park. Jackson told the committee that he will try to have that information by the time the governor updates his budget in May.
"My highest priority has been taking the findings and recommendations of the audits to set a new course," Jackson said. "I have said from the first day that I'm committed to transparency and accountability and to regaining the trust of the people of California."