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Grand jury slams Herald fire district for financial, personnel mismanagement

07/01/2014 12:00 AM

10/08/2014 12:07 PM

A new Sacramento County Grand Jury report calls for an audit of the Herald Fire Protection District, saying fire officials used an unauthorized bank account to conduct business and the fire chief is not managing district personnel in accordance with state law.

The report also found that Fire Chief Chris McGranahan has at times viewed photos of “nude and scantily-clad women on his work computer” that were then emailed to another employee.

The grand jury report cited numerous irregularities regarding the financial affairs and management of the fire district, which serves a rural community of about 1,200 people in southeast Sacramento County and is governed by a board of five elected officials.

“It was very unfortunate in that the actual firefighters we found were doing an amazingly good job,” grand jury foreman Michael Arkelian said Monday. “It was the administrative stuff and the problems with the board that kept undermining all the good work that all the actual firefighters were doing.”

McGranahan was out of the office Monday and did not respond to phone calls and emails from The Bee for comment. Calls also were not returned asking for comment from district board members.

The grand jury found the district for many years had a shared bank account with the Herald Volunteer Firefighter’s Association at the Farmers and Merchants Bank that it did not disclose to auditors of the Sacramento County Finance Department.

An investigation sparked by complaints from residents and civic organizations revealed the existence of the unauthorized bank account, which the fire district used for business transactions related to the rental of two district-owned buildings.

“This practice shielded the existence of these funds and transactions from public knowledge, review and accountability,” according to the grand jury report issued last week.

In July 2012, the volunteer firefighters association withdrew its funds and opened a separate account at another bank. The fire district board voted in 2013 to close its account and deposit the funds with the Sacramento County treasurer.

The review of the district’s finances unveiled other misdeeds, according to the grand jury report, including an instance in which the district paid a salaried employee cash for non-firefighter services and intentionally excluded those payments from the employee’s earnings to understate the income reported on his W-2 tax form.

Jackie Barton, president of the Herald Area Civic Association, said the district’s mismanagement has been going on for years and that people in the community find it hard to change.

“No one can audit what they turn over because it’s so elusive and hidden and illegal,” Barton said. “The money has been so comingled and been used with no documentation. The mismanagement is tremendous.”

In addition to financial violations, the grand jury found the district violated the Firefighters Procedural Bill of Rights Act. The district and the fire chief have failed to adopt policies that the law requires to provide firefighters protections in disciplinary proceedings, according to the report.

Current policies do not provide full-time firefighters the opportunity to appeal a punitive action, as required by the the act. “The fire chief and his administrative staff have repeatedly demonstrated their lack of knowledge of the act’s requirements,” the report said.

The report also cited the chief for possibly violating district policy when he viewed the racy photos of women on his computer and raised the possibility that he may be unwilling to discipline himself and others.

“Over several months, in at least three instances, the fire chief viewed photos of nude and scantily-clad women on his work computer, which were then emailed from his district email account to another firefighter employee, who claimed to be offended,” according to the report. “(The fire chief) has interpreted the district disciplinary policy that he is obliged to enforce in a manner that insulates his own conduct and protects him from punitive action.”

The reported recommended that the district take certain actions to correct its deficiencies in financial and personnel management, including:

•  Establishing adequate internal accounting controls.
•  Adopting policies compliant with the Firefighters Procedural Bill of Rights Act and ensuring that firefighters are aware of the act’s requirements.
•  Considering consolidation of its fire and emergency services with a nearby fire district.

The fire district board made headlines a year ago when it voted to oust one of its members, a move that community residents and county Supervisor Don Nottoli said was illegal in the absence of a recall election or a grand jury finding of misconduct. Board member Lance Newhall was reinstated on a subsequent vote.

Sacto 911 Staff

Bill Lindelof
blindelof@sacbee.com
@Lindelofnews

Cathy Locke
clocke@sacbee.com

Andy Furillo
Superior Court
afurillo@sacbee.com
@andyfurillo

Denny Walsh
Federal Court
dwalsh@sacbee.com

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