County’s debt collection is badly broken

Sacramento County CEO Nav Gill speaks to The Bee’s editorial board on June 21. A grand jury report on the county’s debt collection system is a test of his leadership.
Sacramento County CEO Nav Gill speaks to The Bee’s editorial board on June 21. A grand jury report on the county’s debt collection system is a test of his leadership. lsterling@sacbee.com

Every year, citizens across California volunteer to serve on civil grand juries – important watchdogs over local government. Their reports sometimes fly under the radar, but they deserve our attention.

The 18 members of Sacramento County’s grand jury issued their 2015-16 reports just before the holiday weekend. As ever, they had a wealth of recommendations. They call for all local police departments to use the best ways to handle domestic violence cases, for instance, and suggest that mentally ill inmates not be released at night from the main county jail, but only when they can be handed off to services.

The reports also spotlight conflicts of interest at the Twin Rivers school district and a lack of transparency in Sacramento City Council members’ discretionary spending.

But the most significant and damning finding is about Sacramento County’s debt collection system, which is clearly not doing the job.

Indeed, it is so dysfunctional and inefficient that uncollected debt at the end of 2015 totaled $658 million, up from $370 million in 2008, according to the grand jury. That’s a lot of money that could help pay for a host of needed county services.

The Department of Revenue Recovery collected only $43 million in 2015, or about 6 percent of the outstanding amount. But it apparently doesn’t have a plan to improve the collection rate, and isn’t properly keeping track of debt payments that are made, the report says.

If that isn’t bad enough, the grand jury found that department officials have not responded to concerns and even cut off a 2014 audit by the county’s finance department, though the auditors said there could be fraud.

The grand jury faults top county officials and county supervisors for not paying enough attention to a failing system and say they “need to address this travesty with some urgency.”

This is an early test for new county CEO Nav Gill. Will he respond effectively to outside criticism, or not?

In a statement, a county spokeswoman said “if there’s something wrong with our system or operation, we are 100 percent committed to fixing it.”

Grand jury reports often piggyback on media investigations, as does this one. The Sacramento Bee’s Brad Branan reported in 2011 about a no-bid contract to replace the county’s debt-recovery computer system. The county counsel concluded an analyst who took part in the contract didn’t have a conflict of interest although the vendor once lived with her.

The $4.4 million contract has ballooned to more than $12 million over its seven years. The new system was supposed to increase the recovery rate from 32 percent to 38 percent, but it’s become much worse. The 57-employee department collects court-ordered fines and restitution and other fees, but not child support or property taxes.

By bringing more attention to an issue, grand juries can help force action. In this case, the grand jury says the county should seek alternative ways to collect the outstanding debt and should consider a full management review of the department.

The county plans to issue a point-by-point response to the grand jury report before the Sept. 29 deadline. County officials have a lot of explaining to do.