State Auditor also questions Measure U spending

California State Auditor website, source Fiscal Year 2017-18 General Fund Budget for the city of Hemet
The California State Auditor points out that the presentation is misleading.

■ By Melissa Diaz Hernandez / Editor

The California State Auditor added an update to Hemet’s Corrective Action Plan and Assessment pointing out that the city of Hemet seems to be misleading the public on how it intends to spend the funds generated by Measure U, the 1 percent sales tax passed by voters in November 2016.
Earlier this month, The Valley Chronicle reported what appeared to be an absorption of Measure U funds into the general fund after the Hemet City Council approved 2017-18 budget adjustments in a 3-1 vote at the Feb. 27 council meeting. Mayor Pro Tem Karlee Meyer voted against the adjustments and Councilwoman Linda Krupa was absent from the meeting.
It is also unclear to The California State Auditor how the additional Measure U funds are being used. In its latest update, the Auditor noted that, Hemet “revised its budget to incorporate Measure U revenue and expenditures. However, this presentation is misleading because it does not accurately reflect how the city plans to spend the additional revenue generated by Measure U.
“Although Hemet’s August 2017 update indicates that its general fund revenue will exceed expenditures by $1.3 million, its fiscal year 2017-18 budget states that its revenue will exceed expenditures by $1.8 million in fiscal year 2017-18, as shown in Table 1 [shown],” the report states.
“Included in Hemet’s fiscal year 2017-18 general fund budget is an assumption that Measure U will generate $10 million for the city and that new public safety spending promised in the passage of Measure U would be $7 million,” states the update. The auditor apparently noticed what we had seen in our earlier story.
In the issue of March 15, The Valley Chronicle reported, “The adjusted budget set total resources at $50,359,660 and total uses at $50,009,992. The total resources calculation includes the projected $10,000,000 generated by the 1 percent tax Measure U passed by voters in November 2016. Under total uses, $6,221,366 is allocated for the police department and $1,475,099 for the fire department, totaling $7,696,465. This means that $2,303,535 from the projected Measure U revenue is being included in the total resources.”
The adjusted budget reflects the city of Hemet in good fiscal standing. However, it appears that Measure U funds are being used to make that happen. The Auditor’s update states, “According to Hemet’s city manager, the city intends to designate the remaining $3 million of funds for future public safety spending. Because Measure U funds will not be available to support any type of general fund expenditures, it should not be factored in determining whether Hemet’s general fund revenues will exceed expenditures. If Measure U revenues and expenditures are excluded from the general fund budget, Hemet’s projections will show that its expenditures exceed its revenues.”
It is the opinion of The Valley Chronicle that because the Hemet City Council passed Resolution No. 4731 stating that all Measure U funds will be used explicitly for public safety, the accounting should be clearly defined and brought back to council for reapproval.

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