Park fund scandal a ruse to grab gas tax funds from off-roaders

Aug. 6, 2012

By Wayne Lusvardi

The first wisdom of politics is that things often are not what they seem.  This appears to be the case with the much ballyhooed report that former California State Parks Director Ruth Coleman “hid” $54 million in the off-road vehicle recreation special fund.

A scandal broke out based on reports that the state was too broke to keep open 70 state parks while the Parks Department allegedly had $54 million or more in so-called “hidden” accounts.

In her resignation letter, Coleman said that she was “unaware of the excessive balance” of $133 million in the Off-Highway Vehicle Trust Fund (see Item Nos. 111, 112, 113 in Department of Finance report on special funds).  If Coleman was “hiding” funds. as charged John Laird, Secretary of the Natural Resources Agency:

* Why was the money hidden in plain sight in three accounts designated “Off-Highway Vehicle Trust Fund,” under Fund No. 0263. Which was authorized under the: (a) “Budget Act of 2008 as amended by Chapter 2, Statutes of 2009, Third Ext. Session,” (b) the “Budget Act of 2009,” and (c) the “Budget Act of 2010 as amended by Chapter 13?”

* Why, on May 31, 2011, did State Assembly Budget Committee No. 3 on Resources and Transportation vote to raid the Off-Highway Fund to transfer the funds to the General Fund, as reported by many off-road vehicle recreation organizations?

* Why, on June 6, 2011, did the Public Employees for Environmental Responsibility, stacked with envious state park employees, publicly protest that Off-Road Vehicle fund manager Daphne Greene was not sharing her program’s surplus with its “impoverished agency”?

* Why, on May 6, 2011, did the State Parks Department issue a solicitation for consulting real estate appraisal services through BidSync online bidding services for the acquisition of 415 acres of land to expand the Ocotillo Wells State Off Road Vehicle Park in Imperial County? The likely source of the funds for this land acquisition would have been the Off-Highway Vehicle Trust Fund.

* Why was the Off-Highway Vehicle Trust Fund reported to be a “Special Fund” instead of a “Trust Fund”?  According to off-road organization attorney Diana Tweedy, Trust Funds do not have the same legal status as a Special Fund and cannot be transferred to the General Fund without a state constitutional amendment.

* How could the Off-Highway Fund be “hidden,” when it was re-authorized and amended so many times by the Legislature since 2008?  How could it have been “hidden” if the state Assembly voted to raid the fund in 2011?  How could the fund have been “hidden” if “Public Employees for Environmental Responsibility” brought it to the public’s attention way back in mid-2011?  Why did State Parks initiate activities to expand existing state off-road vehicle parks in mid-2011 from the same fund, if the fund was “hidden?”

An Old Fashioned Grab of Highway Funds

Perhaps the answer to these questions lies with off-roader attorney Diana Tweed’s “Legal Memo” that the Off-Highway Vehicle Fund was a Trust Fund that was funded from a share of gasoline taxes and user fees from state off-road recreation parks.

Which brings us to the second wisdom of politics: “What is alleged to be ‘hidden’ may be a ‘red herring’ meant to divert attention from what is really going on.” Just as smelly fish were used to throw hound dogs off the scent of a fox, so it is with political diversions.

The recent state park special fund scandal apparently is an old-fashioned raid on highway funds.  Only in this case the highway funds are sitting in the accounts of the State Parks Department designated for land acquisition for off-road vehicle recreational parks.  Then why is there what appears to be a cover-up?

Why a Diversion?

While Coleman was allegedly hiding funds, cities and non-profit agencies were raising funds to keep state parks open in their regions so as not to deter tourist trade. How could politicians explain that they were exaggerating that the state was broke, and had no funds to keep all state parks open during an election year?   What Gov. Jerry Brown is doing is purging “Special Funds” — also known as “political earmarks” — and transferring those monies into the deficit-plagued “general gund.”

The Off-Highway Vehicle Recreation Division is a section of the State Parks Department that is not dependent on general funds.  It is self-sufficient and relies on a share of the gasoline taxes generated from the mileage of off-road vehicles and user fees from state off-road recreation parks.  Technically, the Off-Highway Vehicle Trust Fund is not a “special fund,” but a trust fund, just as there is a highway trust fund.

Another apparent reason for the political diversion about “hidden funds” is that there has been an ongoing political and bureaucratic tug-of-war between “preservationists” and “off-roaders” within the Parks Department and the state Legislature.  Off-roaders also tend to be inclined toward being Republican.  A question remains as to whether off-roaders will find a basis to sue the state over the transfer of these “hidden funds.”

Coleman is a registered Democrat with a long track record in state government.  She will likely end up serving elsewhere in government after serving as the “sacrificial lamb” in this political charade.

Fund Raid Takes from Double Tax — When Will It End?

Off-road attorney Diana Tweedy sumed it up best:

“With hundreds of millions of dollars in unpaid loans and the latest permanent and ongoing taking of OHV funds, off road enthusiasts are feeling the pinch. The general fund is supported with income and sales taxes paid by all the Californians. The diversion of OHV Trust Fund moneys to the General Fund is a second tax exclusively paid by off road enthusiasts on top of taxes they pay to the General Fund. These taxpayers are angry and will not put up with politics as usual unless something is done to address their grievances.” 

“Due to hundreds of millions of dollars in unpaid loans and the latest transfer of almost ten million dollars a year from the OHV Trust Fund, the mission of the OHV Program is in jeopardy. The transfers are interfering with Core Program objectives preventing the OHV Program from achieving its purpose. The loans must be paid back and the latest transfer must be revoked before the OHV Program can meet its objectives. 

“Epilogue — In May 2012, the Assembly Budget Committee voted to take more money from the OHV trust fund. When will this ever stop?”

Californians just want to have fun. But the politicians just want more money to waste and are grabbing it wherever they can.


Write a comment
  1. Rex the Wonder Dog!
    Rex the Wonder Dog! 6 August, 2012, 11:05

    I love how they-Brown and Cronies- STEAL dedicated funding so they can pump it into the salary and benefits of the trough feeders.

    Reply this comment
  2. Wayne Lusvardi
    Wayne Lusvardi 6 August, 2012, 11:31

    My laymen’s understanding is that there is a legal difference between “Special Funds” and “Trust Funds.” Both are dedicated. Trust funds are self sufficient and generate revenues from taxes and user fees. Special funds just take General Funds and dedicate them to some pet political constituency or project. That is a big difference.

    Reply this comment
  3. Diana Tweedy
    Diana Tweedy 7 August, 2012, 08:56

    Trust funds are special funds. They are both separate from the general fund and are not part of the general fund for budget purposes. There is case-law that says in certain cases special funds are protected from being used for for purposes outside their special purpose. Like in Daugherty the Corporate Commission fund was being used for a non related capital expenditure and the court said that the Corporate Commission fund was a trust fund and protected from being used for an unrelated purpose. It was set up for regulating corporations with fees collected from corporations just like our OHV trust fund.

    Unfortunately the only protected trust fund these days is the Highway Users Trust Fund because it was inserted into the Constitution (article IX) by an initiative.

    The politicians use our OHV trust fund as their special piggy bank every year so they can fill in holes in the general fund caused by excessive deficits. The only way to change this behavior is to get rid of these politicians, the Democrats, in the state senate and assembly. Vote and make sure that you are registered before the next election in November.

    Reply this comment
  4. jim daley
    jim daley 7 August, 2012, 13:56

    how does a life long democrat become a rightwing racist? Demand pension reform.

    Reply this comment
  5. Lowell Landowski
    Lowell Landowski 13 August, 2012, 15:11

    Jerry Brown and his environmental cronies need to call a time out, and stop shaking the public money tree to do work that should be done inside the budget process and by low paid civil servants not overpaid and under publicly supervised $300 per hour inside nonprofit cronies and consultants.

    Lowell Landowski
    Civil Service Civil Rights Leader

    From: Landowski, Lowell
    Sent: Monday, August 13, 2012 11:14 AM
    To: ‘[email protected]’; ‘[email protected]’; [email protected]; [email protected]; Harder, Marie (CDPH-HISP-PHIB) ([email protected]); ‘[email protected]’; [email protected]; Ken Hamidi ([email protected]); Kim McElroy ([email protected]); [email protected]; ‘Pena, Theresa’; Prude, Wendell ([email protected]) ([email protected]); [email protected]; [email protected]; Lawhead, Terry ([email protected]); Mel B ([email protected]); [email protected]
    Subject: FW: California State Parks Branding Manual

    Tahoe Fund Organizing Sponsor of 2012 Lake Tahoe Summit

    Non-profit’s New Private Funding Model for Basin to be Highlighted at Summit on Monday, August 13
    Published on Aug 10, 2012 – 6:10:19 AM
    Printer friendly page

    By: Tahoe Fund
    TAHOE CITY, Calif. and INCLINE VILLAGE, Nev. ,August 9, 2012 – The need for more public-private partnerships to complete environmental projects at Lake Tahoe is the focus of the 16th annual Lake Tahoe Summit, which will be held this Monday, August 13 at the Edgewood Tahoe resort at Stateline, NV. The free event will be held 9:00 a.m. – 12:00 p.m. and is open to the public.

    “This need is directly addressed by the non-profit Tahoe Fund,” said Amy Berry, CEO of the Tahoe Fund, which for a second year is the Tahoe Summit Organizing Sponsor. “Our goal is to engage people and organizations with a passion for Tahoe and raise the money needed for environmental projects in the Tahoe Basin. The message at the Summit from our elected leaders will motivate people to become involved in the efforts to improve and enhance the recreation and natural resources of this incredible lake.”

    Host U.S. Senator Dean Heller, U.S. Senator Dianne Feinstein, U.S. Congressman Tom McClintock, Nevada Governor Brian Sandoval, California Governor Jerry Brown and other officials and experts are expected to talk about the issues facing Lake Tahoe and the need for public partnerships with private sources like private citizens, businesses and foundations to accomplish environmental and recreational improvements in the Tahoe Basin.

    The 2-year-old Tahoe Fund has raised more than $700,000 in private pledges since last year. The Tahoe-based organization is holding its second annual Summer Dinner this Sunday at Edgewood Tahoe’s Historic Friday’s Station to honor its Founders Circle donors who have pledged to financially support the Fund and its goal of providing funding for conservation, recreation and stewardship education projects at Lake Tahoe.

    Registration at the 2012 Lake Tahoe Summit will begin at 9:00 a.m. at the Edgewood Tahoe resort and presentations will start at 10. Parking will be at the Horizon Casino Resort, 50 Highway 50, Stateline, NV and free shuttles will provide transportation to the nearby Summit venue.

    The mission of Tahoe Fund is to restore and enhance the extraordinary natural environment of the Lake Tahoe Basin by building broad support and funding for projects and programs that increase the enjoyment of the region for current and future generations. The Fund focuses grants on the core areas of conservation, recreation and education/stewardship.

    From: Landowski, Lowell
    Sent: Monday, August 13, 2012 11:05 AM
    To: [email protected]; ‘Pena, Theresa’
    Subject: FW: California State Parks Branding Manual

    More of the same stuff from Jerry Brown, when will they learn to stop shaking the payola money tree?

    From: Landowski, Lowell
    Sent: Monday, August 13, 2012 10:44 AM
    To: ‘[email protected]’; Don Amador ([email protected]); ‘[email protected]’; [email protected]; [email protected]; Ken Hamidi ([email protected])
    Subject: RE: California State Parks Branding Manual

    Today the governor is at the Tahoe Summit, to discuss more money tree shaking of projects and programs to bypass the normal budget process and to purposely avoid the use of modestly paid civil service workers, and instead launder the funds though pro-bono contracts with non-profits with little or no government cost control oversight, so they can charge through the noses, like $300 an hour, for some insider cronies who are grossly overpaid for their work. Such a deal and what great timing, and isn’t it ironic, don’t you think members of the ripped off public and taxpayers. Time to toss out the insider pigs at the trough foundations, and crony state managers who do not deserve their jobs.

    Lowell Landowski

    Civil Service Civil Rights Leader

    From: Landowski, Lowell
    Sent: Monday, August 13, 2012 8:39 AM
    To: ‘[email protected]’; Don Amador ([email protected]); ‘[email protected]’; [email protected]; [email protected]; Ken Hamidi ([email protected])
    Subject: FW: California State Parks Branding Manual

    A big part equation of how they ripped the taxpayers off at Parks

    From: Landowski, Lowell
    Sent: Monday, August 13, 2012 8:17 AM
    To: Robertson, Aaron; Mitchell, Sedrick V.; [email protected]; ‘Pena, Theresa’
    Cc: Harder, Marie (CDPH-HISP-PHIB) ([email protected])
    Subject: FW: California State Parks Branding Manual

    This doing work for free using donated public funds to keep parks open is a huge area of potential wasteful spending and a clear circumvention of Civil Service Laws. Just about any project officer in OGALs could have done the same work for the department at a fraction of the cost to the public. So how much did the Foundation pay its consultants and worker for the various park privatizations project they worked on for us pro-bono? What a scam a laundering of funds and responsibilities. Please forward my concerns to AG and the various auditors. The foundation’s honey pots and spending patterns, and conjoined relations to Parks and other higher ups over Parks needs to be fully and truly investigated

    Lowell Landowski

    Civil Service Civil Rights Leader

    From: Robertson, Aaron
    Sent: Tuesday, August 07, 2012 10:44 PM
    To: Landowski, Lowell
    Subject: California State Parks Branding Manual


    As you requested, I looked into the cost of the California State Parks Branding Manual, dated January 2007. The Manual was developed as part of a three-pronged Marketing Study the California State Parks Foundation did for the Department under a 10-year, no cost marketing commitment.

    The study included:
    1) branding and associated advertising investigations (including development of the Manual),
    2) marketing asset study and
    3) development of a proud partner program.

    No money from the State Parks budget was spent on this project. It was done under agreement with the Foundation as a State Park partner.

    I hope this answers your question. If you have additional questions I encourage you to ask your Manager or raise the issue to your Deputy Director Sedrick Mitchell.

    Thank you,

    Aaron S. Robertson
    Deputy Director, Administrative Services
    California Department of Parks and Recreation

    Reply this comment

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