Hidden Funds Revelation Undermines Tax Hike Campaign

Amid a fervent campaign to convince the public that they should tax themselves $8.6 billion dollars more, Governor Brown’s Parks Department is under fire for a secret stash of $54 million dollars that was recently uncovered.  A smaller scandal – an illegal slush-fund vacation payout to state park employees – led to the discovery.

Here is a scenario:  Lets say you are a regular guy.  You are minding your own business, walking down the street, and checking your pockets for change for a cup of coffee.  Voila!  You find a forgotten surprise! $20 dollar bill in the pocket of a pair of jeans you haven’t worn for a while.  This would be, let’s say:  Feasible.  Unexpected.  Welcome!

Unfortunately, this is not what happens in state government.  You don’t stumble across $54 million dollars in a forgotten account.  Whether it was concealed by mismanagement or malfeasance, it does not matter.  It is the way government operates when, at best, there are not proper checks and balances in place; or at worst, people play loose and fast with other people’s money.  The only surprise is to the taxpayers.

When government malfeasance is unearthed, politicians and bureaucrats feign shock, and the public feels – rightly – duped again.  But there is nothing shocking or unexpected about these revelations.   And they are not welcome news for Governor Brown who is trying to foist the unwieldy tax hike on the public by telling them that there is no more that the state can afford to cut.

Apparently, demonstrably, there is more that the state could cut if it only knew where to find it.

The good news is, there is enough money in the secret stash bucket — $54 million, remember – to keep all 70 parks open that were threatened with closure this year.

The bad news is that Governor Brown wants a state-led audit of the Parks Department and all 560 “special funds” that are apparently floating around out there, unaccounted for in the other state agencies.  The taxpayers should not heave a sigh of relief.   This would be like the Feds asking Bernie Madoff to investigate himself when charges of fraud were leveled against him.  And more bad news: the $54 million still isn’t enough to close the $17 billion dollar deficit.  It’s a drop in the secret funds bucket.

There should be an independent, outside auditor to conduct a completely objective, thorough examination and audit of the state’s special fund finances.

Oh, and lets go back to that earlier imagined scenario.  If you are that regular guy, and you do happen to find that welcome surprise $20 dollar bill in your pocket, keep it a secret.  Because in the state of California, it will either be taxed by state government, or stashed.

(George Plescia is the President of Apex Consulting, Inc. Originally posted on Fox & Hounds.)