In Accounting; the 1st set of three numbers tells which fund the money is taken from and the 2nd set of four numbers tell which department used the product/service. A dump account zero's out the 2nd four numbers so the expenses never hit any department.
I've separated the dump accounts used by the City of Imperial Beach into three categories: '0000', '5000', and '402-5000'.
'0000' – A total of $2,223,706.80 is listed under six different fund accounts. $496,558.33 is coded as '101-0000' – meaning the money comes out of the general fund.
$348,824.07 are under ten different employee payroll deductions for health care, union, and retirement. These expenses should be coded to the individual departments that generated the expense just like the utility bills. Instead all employee deductions are lumped together – line workers and upper management. This would be acceptable if all city employees were receiving the same benefit packages, but employee benefits offered to line workers in the service departments and employee benefit packages provided to management and 'selected' city departments are very different.
$22,746,90 is coded to '101-0000-209.01-03' – Employee Computer Loan Payment. The theory is that the City is purchasing the electronics, but the electronics are paid for out of the employees' paycheck. Most of the purchases are made by the H/R Manager, but some are purchased by the employee and reimbursed by the City. It is a waste of manpower and taxpayer dollars for the city to be a purchaser, broker, and interest-free debt holder for personal use electronics.
'101-0000' is also where refunds of various types are recorded instead of coding the refunds to the specific departments.
101-0000-221.01-05 is used for building deposit bond refunds – but also includes check # 80570 for $5,000 to a city employee with the memo 'refund security deposit'.
The deposit refund to the Surfrider Association for use of the Dempsey Center is coded to four (4) different accounts - three of which have only one entry:
362.82-02 - $150.00 – Rental of City Property
371.83-03 - $107.00 - City Miscellaneous Revenue
374.85-01 - $107.00 – City Cost Recovery – Other Costs
But listed among those three entries is 371.83-02 for $575.00 – Miscellaneous City Revenue – Contributions - with the memo '2011 employee appreciation'.
Perhaps in both cases the money was hidden because the City can not award 'gratuity' to one union employee without awarding it to all union employees.
101-0000-121.00-00 has five checks issued with the memo: 'mr refund' (Marina Vista Center) – and Check # 80273 for a $116.00 parking ticket. There are also deposit refunds for the Marina Vista Center under 221.01-03.
101-0000-221.01-03 – Liabilities – Miscellaneous Deposits. This account totals $80,247.32. $4,087.56 of this account lists three more Marina Vista Deposit refunds, another refund entry for $550.00 to the Surfrider Foundation for the Dempsey Center, a Special Event refund, and an Air Jump refund. And then there is check # 79791 - $76,159.76 to the San Diego County Sheriff's Department with the memo: 'Sandcastle 2011'.
The Sheriff's Department has their own set of accounting codes. The charges for Sandcastle and any other event that requires additional sheriff staffing should be coded to: '101-3010-421' – with the charges broken down to reflect the products/services used. This information should be listed on the bill presented by the Sheriff's Department.
'5000' – When the 2nd set of numbers begin with '5' it indicates the departments will be under the umbrella of Public Works. $721,888.39 was coded to public works dump accounts using five (5) different funds.
'101-5000-532.20-06' – General Fund-Public Works-CIP Administration.Contract-Professional Services. This totals $554,514.69 and are payouts to Lawyers, Consultants, and Contractors. Most of the checks have the memo: '9th/Palm'.
'201-5000-532.20-06' – Gas Tax Fund – These three (3) checks totaled $83,965.25 to Ramona Paving Company with the memo: 'Louden Lane Crosswalk'.
'216-5000' – Housing Authority - $36,283.08 - All Attorney Fees.
'217-5000' – Housing Authority Bond - $21,752.62 – All Attorney Fees.
'502-5000' – Risk Management Fund - $35,372.75 - $34,359.00 to Play Smart with memo: 'Vet Park Tot Lot'.
402-5000-532 – CIP 2010 bond – Public Works - Administration. These accounts total $2,567,722.00 for the last fiscal year. My big problem with this account is that the City has been spending this money for two years, but never added the department to the budget. A department to track this money should have been added to the budget when it was created.
$2,566,305.09 is coded to 532.20-06 – CIP Public Works Administration-Contract Services. This code is for contract services, but has random expenses for items like drill bits & work books. Most of the money went to lawyers, consultants, and contractors. Southland Paving collected $1,579,967.23 in four (4) checks issued between May 11th and August 9th with the memo: 'Street Improvements Phase 4/5'.
This account also lists Check # 79738 - $174,000.03 to San Diego Association of Governors with the memo: 'Regional Beach Sand Project'. Agenda Item 6.1 for the 06/06/12 Council Meeting states the City's expense would be $187,940.00 as 'outlined in a cooperative agreement between the City and the Redevelopment Agency'. This would imply that the City would pay the expense from the general fund and one of the seven (7) RDA fund accounts listed on the budget.
$5.5 million dollars did not hit any accounts last year. Every tax dollar should be allocated because every tax dollar is used for a specific purpose.