The State Worker

July 15, 2012

Unauthorized vacation buyouts secretly pushed through at state parks department, audit says

A high-ranking official at the California Department of Parks and Recreation carried out a secret vacation buyout program last year for himself and other headquarters staff, according to an internal audit, former employees and other documents obtained by The Bee.

The State Worker

Jon Ortiz chronicles civil-service life for California state workers

A high-ranking official at the California Department of Parks and Recreation carried out a secret vacation buyout program last year for himself and other headquarters staff, according to an internal audit, former employees and other documents obtained by The Bee.

The buyouts cost more than $271,000, said Richard Stapler, a spokesman for the California Natural Resources Agency, which oversees the parks department. The money was spent even as the department was planning the unprecedented closure of 70 state parks due to budget cuts.

The program, in which employees were allowed to sell unused vacation time back to the state, was not approved by the California Department of Human Resources, as required by state law, said Lynelle Jolley, a spokeswoman for the human resources department. Due to the state's precarious budget condition, she said, no vacation buyouts have been approved by the agency since 2007.

"They definitely did not authorize this," Stapler confirmed.

To avoid a paper trail, the buyout requests were submitted in some cases only on Post-It notes, not official forms, according to an internal parks department audit obtained by The Bee.

Investigators were told that "the knowledge of the leave buy out plan was not to go out to anyone and that the leave buyout plan was not to be referred to or discussed in email communications," according to the audit.

In total, 56 employees took advantage of the buyout, Stapler told The Bee, mostly between May and July 2011. The program was made available only to employees at parks headquarters. It occurred while the parks department was slashing expenses at parks across the state to achieve $22 million in budget cuts ordered by the governor and Legislature.

Ted Jackson, a retired deputy director of operations at the parks department, said he was appalled that the buyouts occurred with so many state parks on the verge of closure.

"People I care about are being hurt and the parks are being hurt," said Jackson, a 30-year state employee who worked at parks headquarters for five years. "These are sensitive resources that were given to us to hold in trust for ourselves and future generations."

State workers are allowed to accrue up to 640 hours of unused leave time during their career, but that cap is routinely ignored. The state is obligated to pay for accrued leave when an employee leaves state service, at the rate of the employee's final salary.

The secret program at the parks department was unusual because it allowed a select group of workers to cash out their leave.

The money spent to buy out vacation time would have been enough to keep several state parks open.

For example, the city of Benicia offered to operate Benicia State Recreation Area if the parks department would agree to contribute $77,000 – a fraction of actual operating costs. The department refused, and the park remains threatened with closure.

In another case, Malakoff Diggins State Historic Park in Nevada County avoided closure with just $25,000 contributed by its nonprofit cooperating association. Because of that gift, the nonprofit had no money left to operate the campground, which will remain closed.

'An egregious, bad thing'

The Natural Resources Agency would not divulge the name of the executive responsible for carrying out the vacation buyouts, citing state laws that forbid disclosing personnel matters.

"We have certain privacy constraints," Stapler said.

But numerous people, including Jackson and department sources who requested anonymity, told The Bee that the person responsible is Manuel Thomas Lopez, 45, who was deputy director of administrative services at the parks department.

Jackson worked alongside Lopez at state parks headquarters until February 2009, when he resigned to protest what he called a "hostile" work environment at headquarters.

Brent Marshall, spokesman for the State Park Peace Officers Management Association, also told The Bee that Lopez was responsible for initiating the vacation buyout. The group represents park rangers at the supervisory and managerial level, including some who work at headquarters.

"People did not know about it except at the highest levels," Marshall said of the buyout. "There was definitely discontent. The practice was questionable while we were trying to keep parks open."

Lopez, a Granite Bay resident, did not respond to numerous requests for comment left on an answering machine at his home phone number.

State Parks Director Ruth Coleman said the buyout occurred without her knowledge. She said she felt "shock and dismay" when she learned about it months later after rumors about the program had spread through the department.

"From the minute I found out about it, I knew it was an egregious, bad thing," Coleman said, "and I immediately directed staff to get to the bottom of it."

That included an internal audit, then an investigation by the state attorney general's office. The Bee obtained copies of both investigations from the Natural Resources Agency.

Deputy director demoted

The attorney general's investigation states that an employee was relieved of his position on Oct. 19, 2011, after the buyout became known to other top executives at the parks department. On the same date, Manuel Lopez was removed from his deputy director position and reassigned to a lower-paying job in another unit of the department, Stapler told The Bee.

Lopez's salary was cut as a result, from $9,476 per month to $7,474, Stapler said.

Lopez resigned from the department on May 16, Stapler said.

The department considered bringing criminal charges against various employees when it learned about the buyout but concluded that was not possible, Stapler said.

"In the end what they did determine was that because the employees who benefited from the cashouts had actually earned that leave, criminal charges could not be brought against those responsible," Stapler said.

Nevertheless, he said, more employees may be held culpable. "Additional discipline is still being determined," Stapler said via email.

In his deputy director post, Lopez oversaw the administrative services division at the department. This is the unit charged, among other things, with disbursing hundreds of millions of dollars in operating funds to keep parks functioning.

The vacation buyout cost a total of $271,264, Stapler said. According to payroll records obtained by The Bee, Lopez received one of the largest single payouts, amounting to at least $20,600, or nearly 20 percent of his annual pay.

The total cost of the buyout program may be greater than Stapler's estimate.

The internal audit, completed in November, confirms that the parks department "overstepped its authority" by buying out vacation time. But the auditors acknowledge many questions remain unanswered.

"Time and staffing constraints have precluded the audits office from a thorough and exhaustive review of leave accounting and payroll records," the document states.

The auditors turned up evidence of additional unauthorized vacation buyouts at parks headquarters in 2004, 2005 and 2008. The cost of these buyouts is unknown, either because the auditors did not fully investigate those leads or records could not be found.

Payroll codes falsified

Rumors of the 2011 buyout had been rampant for weeks in the early fall. According to the attorney general's report, a formal investigation began in mid-October after a top official at the parks department found a document on his chair that "appeared to substantiate the rumors."

On Jan. 9, department officials asked the attorney general's office to investigate.

The attorney's general's report, completed April 27, confirms the findings of the internal audit. According to the report, investigators were told that several managers involved in meetings when the buyout was announced warned that it could not or should not be done.

The investigators found that payroll codes were falsified to obscure what was happening. The payouts were coded as overtime, not as vacation, personal leave or compensatory time off.

"This was not an accurate or truthful representation of the leave that was being purchased," the attorney general's report states.

The report says some managers were told the buyout was necessary to liquidate an even larger cash surplus that had accumulated at the end of the 2010-11 fiscal year. The reasons for this surplus and its size are not revealed in the report.

Adure Renee Velazquez, a former acting assistant personnel officer who worked in the administrative services division at park headquarters, was among the employees who said Lopez authorized the buyout.

"We were instructed as managers to go to our subordinates and ask if they wanted to cash out their vacation time," Velazquez said.

Velazquez said she did not put in for a buyout herself and recalls expressing doubts about it. "I was told we've got authorization to do that," she said.

Velazquez was fired from her job in September. In June, she filed a civil lawsuit in Sacramento Superior Court against Lopez and the state, alleging she was fired unfairly.

In an official notice of the firing signed by Lopez, he alleges Velazquez engaged in fraud by participating in Zumba dance classes while on disability leave for back injuries sustained in a car accident. Velazquez said she told Lopez the classes were specifically recommended as therapy by her doctor. She said Lopez never bothered to verify that.

Velazquez alleges that Lopez fired her because she objected to the way two other female employees were treated by him and other managers after the two women alleged they were sexually harassed at parks headquarters. An earlier lawsuit on these harassment claims is also winding its way through the county court system.

Editor's Note: This story has been corrected from online and print editions to state that California state employees can accrue up to 640 hours of leave time, not 680 hours. Updated July 16, 2012

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