How the California Department of Parks and Recreation came to possess millions of unreported dollars sometime in 1996 “may never be fully understood,” the state Attorney General’s office reported last week.

But sometime between 1999 and 2003 the merely suspicious became deliberate subterfuge, and for the next nine years, until the scandal broke last year, a parks fund that topped $29 million at one point sat hidden from view.

Deputy Attorney General Thomas M. Patton’s executive summary laid out a 20-year tick-tock of the scandal, but started off by spinning the good news. Initial press reports in June 2012―that the department was hiding $54 million during a budget crisis which threatened closure of 70 parks―were wrong.

Nearly $34.5 million of the money, discovered in the Off-Highway Vehicle Fund, was just a bookkeeping incongruity between the Parks Department and the Department of Finance.

However, according to Patton, “The systematic non-disclosure to the DOF of millions in State Parks and Recreation Fund (SPRF) monies for the past 15 years is a different story.”

It’s a story that probably began in 1993 when money started accumulating, probably undetected, in the fund. The department was running dual financial tracking and budget programs for five years as part of a budget project, and the Attorney General’s office surmised that the money could easily have gone overlooked.

Investigators know that ex-budget officer Becky Brown knew about the fund in 1998, and by 2003 the department’s budget supervisor and all the accounting officers knew about it.

“Numerous individuals failed to take appropriate action,” the report said, some out of fear that the department’s budget would suffer if the funds were revealed and some out of embarrassment that the money existed. Potential culpability was not mentioned as a possible motive. “Some parks employees consistently requested, without success, that their superiors address the issue.”

The fund grew from $5.5 million in 1996 to a high of $29.2 million in 2003, then declined over the next four years to $20.2 million.

No one would touch the hot potato until Aaron Robertson, a lieutenant colonel in the Marine Corps reserves, took over as head of the department’s administrative services division and began to inform other government officials about the problem. The scandal broke in the summer, at the tail end of a frantic fundraising effort to keep parks threatened by budget cuts open and by summer’s end, Parks Director Ruth Coleman, who denied any knowledge of the money, had resigned.

Although the money in the fund was not reported to the Finance Department for budgetary purposes, it was consistently reported to the state Office of the Controller. The two agencies do not reconcile their numbers.

Officials have not decided whether to file any criminal charges.

–Ken Broder

To Learn More:

Investigator: Parks Staff Hid Surplus to Avoid Cuts (by Brian Joseph, Orange County Register)

State Parks Officials Deliberately Hid Millions, Report Says (by Chris Megerian, Los Angeles Times)

Attorney General's Investigation into Discrepancies in Financial Reporting by California State Parks (Attorney General’s Office)