OAKLAND, Calif. (July 14, 2011): Today Oakland City Auditor Ruby released two performance audits analyzing the City's use of parcel tax proceeds from the Emergency Medical Services Retention Act of 1997 (Measure M) and the Paramedic Services Act of 1997 (Measure N). The audits focused on whether or not the proceeds from the Measures were properly disbursed in accordance with the ballot measure and if the Administration implemented the 2008 audit recommendations.

The Measure N audit found that the Measure's Fund balance had grown by 50 percent and that the City did not take steps to reduce the Fund balance and establish an appropriate reserve, as was recommended in the 2008 audit. However, for each of the last ten years, City staff requested that City Council approve an increase on taxpayers despite a Fund balance with a peak of $2.1 million in FY 2009-10 ($1 million above Oakland Fire Department's identified needs). For Measure M, the Administration reduced the Fund balance, as was recommended in the 2008 audit but failed to establish a reserve policy. Both the Measure M and N audits found that, when disbursed, the proceeds were in accordance with the Measures.

"It is not in Oakland residents' best interest for the City to accumulate special tax funds when the General Fund is overburdened to the point Oakland is reducing city services and laying-off City employees," said City Auditor Ruby. "As the City struggles with record deficits, ballooning pension liabilities and an aging infrastructure in dire need of repair, the Administration now more than ever should be committed to ensuring policies and procedures are in place and operating, reassuring the public that their parcel tax dollars are being utilized in a timely manner."

Ballot measures are designed specifically to address the public's desire to fund certain services annually; the continued practice of increasing the Measure N fund balance and not expending voter-approved monies was inconsistent with the intent of Measure N. For both Measure M and N, the audit found that Oakland Fire Department's (OFD) Projected Balance and Spending Plan did not accurately project or otherwise account for Measures' fund balances, though OFD did possess valid reasons for maintaining a portion of the fund balance.

"We are in extraordinary times, and yet these audits highlight the Administration's choice to abandon management systems. This approach does not reassure the public that their tax dollars are being monitored appropriately or that the intents of Measure M and N are being met." City Auditor Ruby concluded, "If the City wants to show voters it's serious about managing parcel tax dollars, addressing these audits' recommendations is a first step in reestablishing the public's trust."

In 1997, the voters of the City of Oakland passed Measure N, which imposed a special tax on all parcels in the City to raise the necessary revenue to increase, enhance, and support paramedic services in the City. Voters also passed Measure M in 1997, which imposed a special tax on all parcels in the City to raise the necessary revenue to retain and enhance emergency medical services.

For copies of the reports, visit: www.OaklandAuditor.com.

ABOUT OAKLAND CITY AUDITOR RUBY

City Auditor Courtney A. Ruby, CPA, CFE, took office in January 2007 and was reelected November 2, 2010. Performance audits of the Fox Theater Renovation Project, Oakland Police Department, Parking Department, Online Payment, and Accounts Payable are in progress. Earlier audits reviewed the City's hiring practices, public campaign financing, funding for children and youth services, library services, CEDA and PWA receivable series, Public Works Agency and the grant management for the Measure Y Violence Prevention Programs. In March 2010, an Association of Local Government Auditors peer review team found the Office of the City Auditor met the highest government standards in performance auditing. Visit www.OaklandAuditor.com to learn more about Oakland's Office of the City Auditor.

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