Treasurer Withholds Funding; Seeks Judicial Review Update, grant suspended

Selinda Barkuis WSBA 24139, County Treasurer

McEntire sneering

Jim McEntire

On the day he filed for re-election, Clallam County Commissioner McEntire led the Board of County Commissioners into approving two resolutions “authorizing” the County Auditor to issue warrants from the Opportunity Fund to pay for a $1 million grant to the Port of Port Angeles and a $285,952 grant to the City of Port Angeles.

The next day, the County Administrator signed a simple budget modification appropriating $3 million away from “Transfer to Carlsborg Sewer Project,” and re-directing the same to “Port of Port Angeles,” “City of Port Angeles,” and “Undesignated Projects.”

In an email the week before, the County Administrator communicated that it was the County Commissioners’ “expressed wish” that the Auditor’s office “create the warrant without a need for an intergovernmental agreement.”

In my opinion, the County Commissioners do not have the authority to so “authorize” and “wish” away their own compliance with applicable State law and County policy. As such, as the duly elected County Treasurer acting on behalf of my constituents (the Clallam County taxpayers), I will withhold the funds for these “grants” until the Clallam County Superior Court has determined whether these funds are being “disbursed according to law.” (RCW 36.29.020; Chapter 7.16 RCW)

I believe judicial review is justified for the following reasons:

1. The considerable amount of public funds at stake (as much as $3 million).

2. The extensive and technical nature of the many relevant provisions in State Code, County Charter, County Code, County Policies, County Resolutions, Washington State case law, Attorney General Opinions, and the State Auditor’s BARS manual.

3. The basic nature of the County taxpayers’ right that “to address unanticipated expenses, the County must hold public hearings” and their concomitant right to petition Superior Court for review within five days after such a public hearing.

4. The County’s limited ability to recall the funds, once they have left the County Treasury, especially in the absence of any written contracts.

5. The precedential impact of the above public fund transactions on future appropriation and spending decisions by the County Commissioners.

Taxpayer right to public hearings.

There is nothing in the 2015 County Opportunity Fund budget that contemplated the making of grants to outside entities. Instead, the County’s 2015 detailed budget for the Opportunity Fund contemplated a $1 million transfer for REET repayment (which occurred on February 28, 2015) and the pass-through transfer of $9+ million in “proceeds of Other Long Term Debt” from the State Public Works Board to the County’s Carlsborg Sewer Project, consistent with Resolution 78, 2011 and the County Administrator’s 2015 Budget Message.

Yet less than six months later, the County Commissioners unilaterally modify the budget, without any prior public hearing, appropriating $3 million away from “Transfer to Carlsborg Sewer Project,” and re-directing the same to “Port of Port Angeles,” “City of Port Angeles,” and “Undesignated Projects.”

These grants are not being made from “unanticipated federal or state funds.” Nor could the County taxpayers reasonably have foreseen the Commissioners’ intent to make grants to outside entities from funds that were specifically appropriated to transfer to the County’s Carlsborg Sewer Project. As a result, these “unanticipated expenses” are subject to a prior public hearing under the debatable emergency provisions of RCW 36.40.140, County Policy 500 at 5.6, and the County’s own past practices.

Taxpayer right to judicial review.

Not only are the County taxpayers entitled to a public hearing, Chapter 36.40 RCW calls for such a hearing to be held at least five days before the appropriated funds leave the County Treasury. This five-day period is meant to give “taxpayers of the county feeling aggrieved” the opportunity to petition Superior Court for review “de novo” for a “determination as to whether an emergency such as is contemplated within the meaning and purpose of this chapter exists or not and whether the expenditure authorized by said order is excessive or not.”

The “service and filing” of such a taxpayer petition “shall operate to suspend the emergency order and the authority to make any expenditure or incur any liability thereunder until final determination of the matter by the court.”

In drafting Chapter 36.40 RCW, the State legislators likewise realized that there would be little left to discuss once the funds have left the County Treasury.

Taxpayer right to written contracts.

Not only did the County Commissioners unilaterally authorize themselves to grant away $3 million from the County Opportunity Fund, they communicated the “expressed wish” that the Auditor “create the warrant without a need for an intergovernmental agreement,” contrary to County Policy 560 which states that written contracts are “always required” for “intergovernmental agreements.”

Without written contracts, how can the County Commissioners assure the County taxpayers that the Port and City are assuming “corresponding legal obligations” that are legally sufficient to overcome the presumption that these grants are really unauthorized gifts of public funds?

Without written contracts, how can the County Commissioners assure the County taxpayers that these grants will be used consistent with the County Opportunity Fund program under RCW 82.14.370, Chapter 5.40 CCC and County Policy 530?

Without written contracts and without public hearings, what is left to stop these County Commissioners from unilaterally appropriating and spending away the rest of the County Treasury?

Taxpayer right to check and balance. Under a “check and balance” principle, the people of Washington State segregated the County’s authority to spend public funds among the County Commissioners, the County Auditor, and the County Treasurer, subject to petition by the County taxpayers for review by the County Superior Court.

There would be little point in having these checks and balances if the County Commissioners truly have the authority to just “authorize” and “wish” them away. It is for this basic reason that, as County Treasurer on behalf of the County taxpayers, I invoke judicial review of these public fund transactions, to occur before the funds leave the County Treasury forever.

(Note from editor:)

Commissioners Blink

Clallam County Board of Commissioners voted today (June 2, 2015)  to suspend, indefinitely, their plan to award $1,000,000 to the Port of Port Angeles and $278,000 to the city of Port Angeles.

These grants were approved last week at the commission meeting when Commissioner Jim McEntire proposed to redirect money allotted for the Carlsborg Sewer project to the above named recipients.

Today’s action came as a result of Clallam County Treasurer, Selinda Barkhuis stating she would not release the funds without approval by Superior Court.  Burkhuis believes the grant awards are contrary to state law and county policy.

Barkhuis says the taxpayers have a right to a public hearing before taxpayers money from the Opportunity Fund can be granted.

At this morning’s meeting Commissioner Mike Chapman delivered a speech suggesting all interested parties meet to discuss their differences.

McEntire was absent from today’s meeting of the Board of Commissioners.

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