Oxnard: Major investigation of employee leave time abuse – $2.6MM+

Also: headhunter retained, harbor contract extension, $10 in bond funds transferred

By George Miller

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Consultant Dania Torres-Wong of Renne, Sloan, Holtzman, Sakai delivers initial employee leave time abuse investigation report at 11-18-14 City Council meeting. (Photo: Citizensjournal.us)

Oxnard does investigation of employee vacation/leave time abuse- Tipsters have been trying to get action on this for a long time. It took a tag team of Councilman Bert Perello and new City Manager Greg Nyhoff to get it going. Other Council members have been supportive. Oxnard has been beset with multiple scandals- public works, illegal supplemental retirement benefits, possibly illegal firings and now- this. This project is just part of a larger cleanup effort underway as part of the overall reorganization, now that Greg Nyhoff is on board and has the tools and desire to get it done, with his staff and City Council working together.

Nyhoff hired consultant Renne Sloan Holtzman Sakai to investigate/audit. They found $2.6 million in leave accruals and for untaken leave $1.9 million.  White Nelson Diehl Evans LLP, CPA identified this problem in its report in 2013.  The consultant said the problem dates back at least to 2005.

What’s been happening is a longstanding practice of allowing employees to work without taking vacation and sick leave, to where huge balances, payable in cash, are run up. Some could be forfeited if kept too long. Theoretically this is not allowed to happen, but does. Some employees feel pressure to do this because of understaffed departments. Mayor Flynn strongly believes that employees should utilize that leave and that it enhances well-being and productivity. It is estimated that employees each have about 350 hours of compensation leave annually.

OxnardLeaveAccrual11-18-14

Source: Renne Sloan Holtzman Sakai

It’s more complicated than it seems since different departments followed different rules, most of them illegal. Enforcement of the policy simply has not occurred in most departments. The Fire Department looks like a major exception, with a small accrual of unused leave. Mayor Tim Flynn said all levels of the organization right up to the top were involved, either through willful collusion or failure to ensure compliance. 

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Fire Dept. stayed out of trouble with one of lowest per capita accruals- shown- Chief Williams.

Councilman Perello, unsuccessful City Council candidate Aaron Starr and Mayor Tim Flynn all made memorable speeches on it and showed their mettle. all council members were dismayed and want to make it right.

Unwinding this mess won’t be simple. The consultant, Dania Torres Wong,  said you can’t just drop de facto policies, even if they conflict with actual written policies. They must be negotiated back.

Councilman MacDonald warned that insistence on quick rectification could result in potentially hundreds of employees taking leave and creating severe manpower shortages, service deterioration and mammoth overtime bills for the city. Flynn and City Manager Greg Nyhoff both had concerns about employee morale from this and other scandals. So, it could be a double-whammy budget buster and cause management and service level headaches- thanks for the warning, Councilman MacDonald (he is a retired Oxnard PD  Assistant Chief, so he knows about such things.

More than one resident speaker was outraged over  this scandal and what  they thought were the already lavish compensation plans of many employees.

Some say that it was cynical and opportunistic to wait until after the election to do so, but on the other hand it might also be allowing a calmer and less politicized handling of this.

The Council seemed very supportive of the investigation and accepted the report after commenting. Consultant was ubale to answer some questions about the extent and number of people involved. Work on this will continue and a remedial plan will be developed.

Read report and watch video at 1:04

SUBJECT: Internal Control Over Financial Reporting Related to Employee Leave Balances. (001)
RECOMMENDATION: Receive a report and provide comments.
Legislative Body: CC Contact: Greg Nyhoff Phone: 385-7430Document: Staff Report (pdf 463 KB)
Name Date Duration Agenda Minutes Video
City Council Meeting November 18, 2014 05h 17m Agenda Minutes Video

 

Other business

The Council authorized a four month extension to the one year extension the expired contract between Oxnard and Ventura County to operate Channel Islands Harbor. The harbor businesses have deteriorated badly in past decades, with Fisherman’s Wharf now closed, along with the Lobster Trap, Casa Sirena, Port Royale Restaurant and others. There are many many empty slips in the marinas, even as capacity has greatly expanded via SeaBridge Marina and new docks on the East shore of the harbor.

It was announced that a private group, “Friends of the Harbor” (President Steve Kenny spoke at the meeting) is working on a harbor proposal/plan and that they meet  the third Thursday of the  month at 6PM in the SeaBridge club house. Well, it wasn’t this month- a Citizensjournal.us reporter went there at the appointed time and found no meeting there or at the nearby yacht club. We were told at the council meeting that they favored having a developer buy the land now owned by the county, which is mostly the area south of the bridges. If we ever find a meeting, we’ll go and report on it.

The Council  moved on approving the transferring the remaining half of redevelopment bond proceeds, totally nearly $10 million of the original 20.5 million from a fund allocated to do road reconstruction in Ormond Beach, Southwinds and the HERO area. The municipal redevelopment agencies, such as Oxnard’s,  were terminated statewide several years ago and must wrap up their business and dispose of all assets. Document: Staff Report (pdf 1,720 KB)

Council approved retention of  a headhunter: 

SUBJECT: Selection of Executive Recruitment Firm. (045)
RECOMMENDATION: Approve and authorize the City Manager to execute an agreement with William Avery & Associates, Inc. (6947-14-HR) in the amount of $79,100 for executive recruitment services for the positions of City Attorney, Housing Director, Human Resources Director, and Utilities Director.
Legislative Body: CC Contact: Greg Nyhoff Phone: 385-7430

Document: Staff Report (pdf 1,291 KB)

 The only dispute was whether Greg Nyhoff should be involved in the recruiting of the City Attorney, who would report directly to City Council, unlike the other positions, which report to City Manager. Motion approved, but Councilman Perello voted against it because he doesn’t see how a potential conflict of interest would be avoided.

 

George Miller is Publisher of Citizensjournal.us and a “retired” operations management consultant, active in civic affairs, living in Oxnard.

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