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HomeMy WebLinkAboutMINUTES - 02151994 - 1.74 1. 74 THE BOARD OF SUPERVISORS OF CONTRA COSTA COUNTY, CALIFORNIA Adopted this Order on February 15 . 1994 by the following vote: AYES: Supervisors Smith, Bishop, McPeak, Torlakson and Powers NOES: None ABSENT: None ABSTAIN: None SUBJECT: Grand Jury Report Entitled "Employee Wellness Program and Contra Costa Club Funds Lack Accountability" . IT IS BY THE BOARD ORDERED that the Grand Jury Report entitled "Employee Wellness Program and Contra Costa Club Funds Lack Accountability" is REFERRED to the County Administrator and the Finance Committee. bgreby Certify Inst this is a truo and correct copy of an action taken and entered on the minutes of the Board of Supe onthe date shown ATTESTED: PHIL TCHELOR.CI r of th Board Superviso and Coun y mmistrator 9 By .Deputy cc: County Administrator Finance Committee t A REPORT BY THE 1993-94 CONTRA COSTA COUNTY GRAND JURY 1020 Ward Street Martinez, CA 94553 (510)646-2345 Report No. 9401 EMPLOYEE WELLNESS PROGRAM AND CONTRA COSTA CLUB FUNDS LACK ACCOUNTABILITY Approved by the Grand Jury: Date: i h M. Mullin Grand Jury For Accepted for 'ling: D e: L Richard . Amason Judge of the Superior Court f 1 i SECTION 933(c) OF THE CALIFORNIA PENAL CODE i Sec. 933. Findings and recommendations; continent of governing bodies, elective officers, or agency heads. (c) No later than 90 days after the grand jury submits a final report on the operations of any public agency subject to its reviewing authority, the governing body of the public agency shall comment to the presiding judge of the superior court on the findings and recommendations pertaining to matters under the control of the governing body, and every elective county officer or agency head for which the grand jury has responsibility pursuant to Section 914.1 shall comment within 60 days to the prbsiding judge of the superior court, with an information copy sent to the board of supervisors, on the findings and recommendations pertaining to matters under the control of that county officer or agency head and any agency or agencies which that officer or agency head supervises or controls. In any city and county, the mayor shall also comment on the findings and recommendations. All such comments and reports shall forthwith be submitted to the presiding judge of the superior court who impaneled the grand jury. A copy of all responses to grand jury reports shall be placed on file with the clerk of the public agency and the office of the county clerk, or the mayor when applicable, and shall remain on file in those offices. One copy shall be placed on file with the applicable grand jury final report by, and in the control of the currently impaneled grand jury, where it shall be maintained for a minimum of five years. (Added by Stats 1961, c. 1284, § 1. Amended by Stats 1963, c. 674, § 1; Stats 1974, c. 393, § 6; Stats 1974, c. 1396, § 3; Stats 1977, c. 107, § 6, Stats 1977, a 187, § 1; Stats 1980, c. 543, §1;Stats 1981, a 203, §1;Stats 1982, c. 1408, §5, Stats 1985, c. 221, § 1; Stats 1987, c. 690, § 1; Stats 1988, c. 1297, §5.) Former§ 933,added by Stats. 1982,c. 1408, §6,amended by Stats. 1985,c.221, §2,operative Jan 1, 1989,was repealed by Stats. 1987, c.690,§2. Former § 933, added by Stats. 1959, c. 501, § 2, was repealed by Stats 1959,c. 1812,§3. SUMMARY Contra Costa County's own health and wellness facility, the Contra Costa Club, located at 627 Ferry Street in Martinez, has been consistently operating in a deficit mode, with a large share of its membership being non-County employees. The Club derives a large portion of its operating budget from the County's Workers' Compensation Trust Fund, through the County's Employee Wellness Program. The operation lacks proper accounting. INTRODUCTION The Contra Costa Board of Supervisors approved an Employee Wellness Program [the Program] in 1985. Overall responsibility for the Wellness Program was placed with the Personnel Department in the Benefits Division. A Wellness Coordinator was appointed in January of 1986, the official beginning of the Contra Costa County Employee Wellness Program. As stated in the Program's Mission Statement: 'The Employee Wellness Program seeks to implement cost-effective activities, drawing upon the resources within the County and the community, with the eventual outcome of improved personal health for employees and cost savings to the County." In July, 1990, the Employee Wellness Program opened the County's own health and wellness facility, the Contra Costa Club [the Club]. According to the August, 1993 Status Report, The Program rationale includes'The belief that employee wellness programs are cost effective; eventually resulting in decreased absenteeism, Workers' Compensation claims and health care costs." According to the Program's August, 1993 Status Report, 'The Contra Costa Club is available for a monthly fee to all County employees (permanent, temporary, contract), their spouses and dependents and County retirees and their spouses. Limited memberships are also available to the local residents, businesses and government agencies ...." "Funding for the Program was approved for inclusion in the Workers' Compensation Budget in as much as the program was designed to prevent and reduce accidents and illness among County employees and thus reduce Workers' Compensation costs.", as stated in the August, 1993 Status Report on the Program. FINDINGS 1. Since the Club opened in July of 1990, the reported operating deficit, through the end of Fiscal Year(FY) 1992/1993, has grown to $107,000. 1 2. Increasingly larger portions of the Club's operating expenditures have been charged to the Employee Wellness Program, without accountability for these expenditures in the Club's operating profit/loss financial reports. 3. The Club does not maintain record keeping procedures as to the revenue and expenses (profit/loss) attributable to the group of County employee users or to the group of users who are local residents, businesses and government agencies. 4. The Employee Wellness Program is being charged for costs associated with County employees located within Club space, but whose functions are not directly associated with either the Club or the Program. 5. There is no basis for the 1993 Status Report statement, 'The belief that Employee Wellness Programs are cost effective; eventually resulting in decreased absenteeism, Workers' Compensation claims and health care costs", since a formal cost effective benefit analysis to measure decreased absenteeism, Workers' Compensation claims and health care costs for the County Employee Wellness Program has not been conducted. CONCLUSIONS 1. The Club does not maintain a financial record keeping procedure which provides for a true representation of actual expenses, inclusive of those expenses charged to the Employee Wellness Program, and ultimately to the Workers' Compensation Trust Fund. 2. Operational losses associated with the Club are borne by the Workers' Compensation Trust Fund, through the Employee Wellness Program, even though approximately one-third (1/3) of the Club's members are local residents, businesses and non-County government agencies. 3. Some costs associated with general County operations are being supported from the Workers' Compensation Trust Fund, through the Employee Wellness Program, as opposed to being supported from the County's General Fund. RECOMMENDATIONS The 1993-1994 Contra Costa Grand Jury recommends that: 1. The Board of Supervisors direct the Personnel Department to immediately institute a Club financial and membership record keeping system which will result in a true reporting of operational profit/loss. 2 2. The Board of Supervisors direct the Personnel Department to complete a study, within 60 days, to measure the cost and/or the savings to the Club that would be realized by eliminating memberships to local residents, businesses and non-County government agencies. 3. The Board of Supervisors direct the Personnel Department to obtain annual bids, beginning on July 1, 1994, from at least two(2) responsible fitness facilities in the private sector, for user services similar to those provided by the Club. 4. The Board of Supervisors direct the Personnel Department to immediately begin to maintain an on-going comparison of Club costs with costs for similar services provided by, or through, facilities in the private sector. 5. The Board of Supervisors direct the Personnel Department to immediately audit, and to audit annually thereafter, all charges made to the Employee Wellness Program and to certify that all such charges are directly related to the Program. 6. The Board of Supervisors direct the Personnel Department to immediately set up a tracking system designed to evaluate the effectiveness of the Employee Wellness Program. This can be accomplished by maintaining trend analyses associated with such factors as Employee Wellness Program expenditures, County employee absenteeism, Workers' Compensation claims and County employee health care costs. COMMENTS The Club represents one element within the Employee Wellness Program, which receives its funding from the Workers' Compensation Trust Fund. That being the case, adequate record keeping must be maintained so that detailed revenue source and expense tracking can be used to substantiate the need for, and the amount charged to, private non-County users of the Club. Rate-setting for private non- County users of the Club must verify that this group of users does not contribute to a deficit operation and does not subsidize the private user from the County Workers' Compensation Trust Fund. Presently, expenses charged to the Employee Wellness Program are excluded from the Club's operational financial analysis, distorting the actual financial condition of the Club. This practice makes it impossible to determine the viability of the Club, as compared to similar services available within the private sector. 3