The California state controller has demanded that two former top leaders of the state National Guard remit substantial sums in "double-dip" earnings – two days' pay for a single day of work – received improperly while in office.
Maj. Gen. William H. Wade II owes $80,720, while Maj. Gen. Mary J. Kight was billed for $30,407.
Kight, now a part-time Guard member, repaid the amount in full, she said, based on guidance from state personnel officials about her vacation allowance.
Capt. Thomas Beindorf, an attorney assigned by the California Military Department to assist Wade, now based in Italy as NATO deputy chief of staff for operations, said the general was disputing the charges but had not yet prepared a detailed response.
The ruling was based on an evaluation by the state Military Department and the Department of Personnel Administration, following a Bee investigation in April showing evidence that Wade was overpaid by about $155,000 during his nearly five-year tenure as the Guard's top officer. The state billed him only for the last 22 months of his tenure, due to the statute of limitations for recoupment.
State law permits Guard members who also are state employees to collect dual payments – federal military pay and state pay at the same time – for up to 30 days annually. The generals were found to have exceeded those limits by a wide margin. Wade previously argued that he was not subject to state rules limiting dual pay.
"Gen. Kight has taken the right step by paying back the state treasury," said Sen. Ted Lieu, D-Torrance, a member of the Senate Veterans Affairs Committee, and a reserve U.S. Air Force officer.
In response to the Bee investigation, Senate Bill 806 recently was passed by the Veterans Affairs Committee. It would extend the period for recouping improperly paid funds to six years, from the current three. That legislation is now under consideration by the Assembly.
But Lieu said Wade should repay the full amount he received above dual-pay limits, not just the amount billed, regardless of that legislation's outcome.
State authorities should "bring a civil or criminal action against Maj. Gen. Wade should he refuse to pay," Lieu said. "Under California's discovery rule, the statute of limitations for fraud or grand theft does not start until the crime is discovered. What Maj. Gen. Wade allegedly did amounts to fraud or theft upon the state treasury."
As leaders of the Guard, Wade and Kight each earned an annual state salary of more than $200,000. On average, Wade claimed $50,000 extra in federal pay each year. Wade left his post in early 2010. Kight succeeded him and served a little more than one year.
Adjutant General David S. Baldwin, appointed by Gov. Jerry Brown to lead the Guard in April, asked the Department of Personnel Administration to examine pay records for his two immediate predecessors.
"Fiscal accountability is a cornerstone of my command philosophy," Baldwin said. "We will be effective stewards of the taxpayers' money and we will exemplify the principles of selfless service."
The Bee found that several other generals might have violated dual-compensation rules. Records did not indicate whether apparently improper payments were deliberate or due to errors. Baldwin ordered separate reviews, which are pending, for improper payments to all generals who worked for the Guard full time at any time since January 2007.
He said the Guard's system for cross-checking federal and state orders that determine dual payments will be improved to help prevent excess compensation in the future.
Baldwin also ordered an audit of his own pay records and those of Col. Matthew P. Beevers, assistant adjutant general, and Col. Robert A. Spano, chief of staff. He said the reviews will be made public when complete.
A BEE INVESTIGATION
Read Inside the California National Guard, a series of Bee stories that uncovered financial lapses.