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Grand jury slams Tuolumne Economic Development Authority over transparency

The annual Tuolumne County Civil Grand Jury blasted the Tuolumne County Economic Development Authority over a lack of transparency and for not following the same procedures and best practices as other taxpayer-funded public agencies.

The 183-page report released Friday detailed the jury’s findings and recommendations from its investigation of the TCEDA conducted over the past year, in addition to investigations of Sierra Conservation Center, Tuolumne County Jail, the Mother Lode Regional Juvenile Detention Facility, Groveland Community Services District, and deteriorating county roads.

Civil grand juries in California are required to inspect any correctional facilities in the county each year and can also look into complaints received about other public entities.

Larry Cope, executive director of the TCEDA, did not respond to a request for comment on the report Friday afternoon.

The jury’s investigation of the TCEDA comes in the midst of a transparency lawsuit filed against it earlier this month by Sonora resident Ken Perkins, who is seeking data to support the agency’s claims of being involved with $393 million in investment projects that have created more than 2,000 jobs at an average wage of about $20 an hour over the past eight-plus years.

This year’s jury launched an investigation into TCEDA in the fall after becoming aware of concerns from citizens regarding to the agency’s transparency and effectiveness, the report stated.

The report stated the jury chose to investigate TCEDA based on the county’s ongoing financial challenges, lack of tax revenue, limited jobs that pay family wages, and the fact that the agency had not been reviewed by a grand jury since it was created in 2009.

Aspects of the investigation included reviewing dozens of documents and reports, attending TCEDA board meetings, and conducting 23 interviews with TCEDA board members and staff, local and federal government officials, and businesses in both Sonora and county.

Although the TCEDA is a joint-powers authority funded primarily by the county and city, the jury found that it has established its own rules of governance that don’t follow the same best practices as its founding partners.

One of the jury’s chief recommendations is for the city and county to hire an independent firm to conduct a “management audit” that would look at the agency’s checks and balances on travel and entertainment expenses, metrics to evaluate performance, and policies on disclosure of interactions with private businesses, among other things.

For example, the jury found that Cope is allowed to authorize his own travel and approve his own expense reports without input from the authority’s board.

Cope is also allowed to expense alcohol for entertainment purposes under the authority’s “travel and entertainment policy,” while most other public agencies don’t allow alcohol to be purchased on the public’s dime.

The report stated that entertaining expenses are supposed to be for “clients” under the terms of Cope’s contract, but the jury reviewed expense reports and found that 53 percent of his 162 entertainment meal expenses were spent on TCEDA board members, county supervisors as well as local and federal officials.

A person interviewed by the jury said he paid for his own meals while dining with Cope, but the report stated there is no documentation or procedure to keep track of whether it was deducted from the bill.

One of the jury’s recommendations is for the TCEDA board to develop a formal policy specifically defining “clients” and what’s acceptable when it comes to entertaining clients, board members, and government officials.

The jury also recommended establishing a maximum amount of vacation that Cope can accrue each year after finding out that he used a cumulative of 120 hours and cashed out a total of 720 hours of vacation time from 2015 through 2017.

In addition, the jury found that Cope’s calendar for last year showed him to be in England from Sept. 11 through Oct. 9, though only four days of that were listed as vacation time while the rest was listed as “comp time and remote working.”

Cope’s compensation plan for next year includes a base salary of $163,634 that includes $500 per month car allowance, $200 per month phone allowance, and a severance package for up to six months of pay if his contract is terminated before it expires.

The jury also determined TCEDA could be in violation of the Brown Act, the state law guaranteeing public access to local government meetings, by having external interactions with private businesses behind closed doors.

“This may be a Brown Act violation because interactions with and assistance provided to businesses are not being discussed at public TCEDA meetings,” the jury’s report stated.

Perkins sued TCEDA after the agency denied his request for data under a provision of the California Public Records Act intended to protect the trade secrets of private companies from public disclosure.

The jury requested a comprehensive list of businesses assisted and information on assistance provided by TCEDA but was told that such information doesn’t exist, according to the report.

However, the report stated that the jury was told by TCEDA board members during interviews that the information does exist. Ultimately, the jury never received the information.

Some of the business owners interviewed by the jury had positive things to say about the support they received from the TCEDA for services such assistance with regulations and red tape, while other businesses weren’t aware of the agency or what services it provides.

The jury stated TCEDA doesn’t maintain a database of businesses served, issues addressed, and lessons learned, and described it as a “very informal agency with few standard operating practices or best practice procedures.”

Another recommendation is for the County Counsel’s Office to review possible conflicts of interest for TCEDA board members who also serve on boards for other entities.

The TCEDA board consists of two members from the county Board of Supervisors, two members from the Sonora City Council, and three “at-large” members from the public.

District 4 Supervisor John Gray and District 1 Supervisor Sherri Brennan represent the county, while Sonora Mayor Connie Williams and Councilman George Segarini represent the city.

The three at-large members on the board are Dave Thoeny, executive director of Mother Lode Job Training, Barry Hillman, executive director of the nonprofit health literacy group HealthLitNow, and Sonora attorney Jim Gianelli, who also serves on the board of HealthLitNow.

The jury noted that Cope and the TCEDA board also serve as the respective board and director for the Economic Prosperity Council of Tuolumne County, a tax-exempt corporation that receives private donations and grants primarily for job training and has given funding to HealthLitNow.

Other highlights from the grand jury’s report include:

• Management at Sierra Conservation Center in Jamestown sat in on the jury’s interviews with inmates about conditions at the prison and would offer their opinions and give explanations in response to statements made by inmates.

• The policy concerning transgender inmates at Tuolumne County Jail references “gender identity disorder” that was removed from the American Psychiatric Association’s list of recognized psychiatric disorders in 2012.

• The Sheriff’s Office had yet to update the jail’s procedures on immigration holds to reflect the California Values Act, sometimes referred to as the “sanctuary state” law.

• There are not enough youth being housed at Mother Lode Juvenile Regional Detention Facility to enter into a cost-efficient contract for meal service, so they receive the same meals as inmates at the jail.

• Prior general managers and board members at Groveland Community Services District engaged in activity that eroded public trust in the entity, but new General Manager Pete Kampa and three board members who were appointed during the jury’s investigation have made improvements.

• The jury recommends that the county Board of Supervisors put a ballot measure to voters for a sales tax increase that would be used specifically to fund maintenance and repairs to the county’s deteriorating local road network.

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