The Fire Safe Council’s Lack of Fiscal Responsibility
The fire threat in Nevada County is nothing new. Experts have been warning us and our local Board of Supervisors for over a decade that it is not if, but when, there will be a catastrophic event, absent stringent urgent measures.
In the interim, we’ve witnessed many events too close to home for comfort. Almost every election, more taxes are requested for fire safety, now in the billions, to fund preventative and suppression efforts. Local and state lawmakers dictate what fire district or other organization will receive the funds and reports are generated by various sources, but the threat remains quite real and dangerous to human and animal life, homes and property. Insurance rates are skyrocketing and the state has now taken on insuring property owners with huge premiums, which provide minimal coverage while deductibles are extraordinarily high - from $20,000 to $50,000 and more.
The Legislative Analyst’s Office (LAO) provided a report for the 2022-23 state budget for “Wildfire and Forest Resilience Package,” indicating that while the governor proposed $1.2 billion more over the next two years including $800 million in new funding, information on the use of these funds in various “programs” is limited. The report further states that while many “good practices” are being implemented to reduce hazardous fuels, defensible space and home hardening, the available information on cost effectiveness of many programs is somewhat limited, making it difficult to know whether the new package represents the most effective way to allocate funds for wildfire prevention and mitigation.
In other words, billions of taxpayer dollars are being spent with increased allotments for fire safety every year, but is it effective?
Nevada County Fire Safe Council’s potential violations
Locally, the non-profit Nevada County Fire Safe Council (FSC), has been in operation for many years with the purpose of providing critical wildfire mitigation support to the county and wildfire hardening services to residents with a stated mission “To make Nevada County safer from destructive wildfire.” In 2021, FSC received a $3.3 million taxpayer funded grant for such services. In June 2021, usage by FSC of that $3.3 million was brought into question by a concerned citizen and former accountant of the FSC. Grave concerns were raised with corroborating evidence indicative of the diminishing financial viability of the program and transactions that could expose the program to federal IRS, state Franchise Tax Board (FTB) and Labor Board violations that potentially violate the rules and regulations for operation of a non-profit. Subsequently, a journalist for The Union extensively investigated the claims with additional corroboration and as a result of its’ article on 8/26/21, the County informed FSC that they would not award contracts for any new projects until items of concern about the organization’s financial practices and internal controls were properly addressed. In September 2021, findings from a special audit corroborated ongoing issues and in October 2021, I personally addressed the Nevada County Board of Supervisors in a public meeting. Despite growing corroboration of concerns, the FSC continued to be funded with taxpayer funded grant monies and on October 12, 2021, the Nevada County Board of Supervisors passed the FSC’s renewal contract as “routine, noncontroversial.” On October 19, 2021, I sent a letter of dismay to the Board with attachments detailing the apparent problems with continued grant funding to FSC and finally, the Civil Grand Jury issued its report in June of 2022.
The 2022 Grand Jury observed unusual continuous FSC financial employee turnover and issued their report with substantial findings and recommendations, including FSC’s failure to ensure adherence to applicable laws and regulations. The Grand Jury found a lack of operational and financial transparency and failure to comply with five Jury document requests over three months to the FSC Executive Director and the Board of Directors with documents to be presented to the Judge of the Superior Court for Grand Jury review. The Jury report recommended implementation of “fund accounting for grant revenues” after indicating that the FSC was seeking an additional nearly $24 million in taxpayer funded grant monies.
Now, a second 2023-2024 Grand Jury report has issued, entitled “Follow the Money: Fire Safe Council’s Accountability Problems from 2022 Continue . . . and Appear to Worsen,” addresses “sizable unexplained [financial] discrepancies” and “revenue FSC has received from the county,” “co-mingling,” “a dozen [audit] ‘irregularities’”, violations of the State’s Brown Act, “FSC’s refusal to cooperate,” with the Grand Jury, lack of appropriate FSC licensing by the California State Licensing Board, as well as the “county’s performance with respect to [not properly overseeing and monitoring] the two [FSC] contracts,” all preventing transparency and opening the door to potential fraud.
Documents: Wildfire and Resilience Package (download PDF), Grand Jury Report 2022 (download PDF), Grand Jury Report 2024 (download PDF).
Fire Safe Council Executive Salary has more than doubled in the last two years
In fiscal year 2019-2020 the Executive Director’s reportable compensation was about $111,000; in 2020-2021, $173,000; in 2021-2022, $230,000, and in addition, the Executive Director’s husband served as Director of Operations for FSC, earning $162,000, for a total household income of $392,000. For the fiscal year 2022-2023, no reportable compensation filing has been made by FSC. These incomes, in addition to numerous furloughed employees have been provided by continuing taxpayer funded grants.
I appreciate the state’s Legislative Analyst’s Office and the Nevada County Civil Grand Jury’s 2022 and 2024 reports that spell out the need for a determination as to whether the “non-profit” programs being implemented and financed by millions of dollars in taxpayer grants are making a valuable impact in preventative and suppression programs or are a waste of taxpayer money. Hopefully voters will direct their elected officials as to whether they think those dollars would be put to better use elsewhere.
However, “reports” require review and decisive action. Further, if a temporary government program cannot meet its intended goals, it is no longer necessary. That review must be undertaken locally by the Board of Supervisors and other elected representatives in Nevada County and their appointed staff. In the case of FSC, that does not appear to have occurred. Our government has chosen to take millions of hard-earned dollars from private taxpayers by force of law and must secure every individual’s right to a proper return on these funds to ensure fire safety.
Households and private businesses manage their funds responsibly, frugally and sensibly. If they didn’t, their business would fail. The same is expected from our government. The 2024 Grand Jury report is damning and hopefully this evidence of neglect of oversight and monitoring of taxpayer funded grants of this “non-profit” will be finally and appropriately addressed by those receiving taxpayer funded salaries, such as our elected Auditor, Board of Supervisors, Sheriff and District Attorney as well as the Board’s appointed staff, the County CEO and County Counsel.
Will Taxpayers Get Stuck with Fire Safe Council’s Debt Exceeding $1.6 Million?
As referenced above in the 2022 and 2024 reports, two Nevada County Civil Grand Juries each reported grave concerns regarding local non-profit Nevada County Fire Safe Council’s (FSC) financial operations. Moreover, the County Auditor and Office of Emergency Services has recently determined that the FSC non-profit organization is a “high risk vendor.”
The March 24, 2024, meeting packet submitted to the FSC Board of Directors (BOD), contains a “Statement of Financial Position,” indicating that as of January 31, 2024, the FSC had accumulated a debt of more than $1.6 million dollars. That report indicates that $374,480 was for “Advances Against Projects” for the “Nevada County Chipping” program, and additionally over $1.2 million dollars in “Total Long-Term Liability” loans (see below) to at least Tri-Counties Bank, Kubota and RDO Equipment Company, the only creditors to file a UCC Statement (see below) with the California Secretary of State.
Document 1: Total Long-Term Liability (download PDF). Document 2: UCC Statement (download PDF). Document 3: FSC Compensation, July 2021 - June 2022 (download PDF).
The entire debt accrued between 2019-2024 years representing the term of current Executive Director, Jamie Jones. Jones’ last reported salary and benefits from FSC for fiscal year July 2021 to June 2022 was nearly $400,000 per year (see above), including that of her husband, also employed by the FSC. FSC has now purportedly “furloughed” its employees.
In the past, the Fire Safe Council was a true asset to Nevada County. Will taxpayers now be left holding the bag on this $1.6 million debt?
The Fire Safe Council’s current financial situation certainly gives a whole new meaning to the term “non-profit.”
