It's In My Other Wallet 2: More Hidden Billions In California Gov't

The discovery of tens of millions of the Parks Dept. budget stashed away in two hidden accounts has inspired further sleuthing, leading to - son of a gun! - more hidden millions; or, rather, billions:

A week after uncovering a hidden-funds scandal at the state parks department, finance officials are now trying to piece together why the balance sheets for similar "special funds" are off by $2.3 billion -- money that appeared to be right under their noses amid California's financial meltdown. 

An analysis by this newspaper of California's little-known 500-plus special funds -- like the ones that included $54 million in parks money shielded from the Department of Finance -- shows tens of millions of dollars in discrepancies in numerous accounts. 

The fund that gives restitution to violent crime victims was off by $29 million. The one that provides children with low-cost health insurance was $30 million out of balance. The fund that rewards people for recycling bottles and cans was $113 million off. 

"Where are these dollars?" asked state Senate budget chairman Mark Leno, D-San Francisco, who said it was a "big problem" that the special funds "clearly have not been getting enough attention." 

The newspaper's review found at least 17 accounts that appeared to have significantly more reserve cash than what individual departments reported to the finance department, though it's unclear why.

Here's some quick rationalization for you Big Gov't fans out there:

The problem could date back decades and is only now coming to light after discrepancies were discovered in the parks funds, costing longtime parks director Ruth Coleman and deputy director Michael Harris their jobs. 

The potential error is especially remarkable considering how easy it would have been to catch. 

Earlier this year, dozens of state departments told Gov. Jerry Brown's budget aides that they had a combined $8.8 billion left in "rainy day" reserves for their special fund accounts as of a year ago. At the same time, the controller's office tabulated a total of $11.1 billion in cash reserves for the accounts. 

But finance officials, operating under a longtime honor system, never checked the controller's total -- and no oversight groups caught the discrepancy, even though the numbers are publicly available on two state websites. As a result, Brown and the Legislature used the smaller $8.8 billion figure when they approved the state's annual spending plan last month.

Now, someone like me might look at these 500 "special" funds, all of which the public has likely never heard of, can't easily access, and just kind of lay there, and say "Here is Exhibit A for the sort of stuff we could cut from the budget tomorrow and no one would miss it." But, instead, I'll bet the solution will be creating a special Office In Charge of Reviewing Special Funds and Checking the Controller's Numbers. 


State Dems, of course, are trying to treat this as a big nothing with Jerry Brown joshing that this is the first time he's heard of a scandal where gov't was saving money. Har. Har. Guess there's no reason, beyond grim-visaged class warfare, to vote for any tax increases this November.