Report 2014-117 Recommendation 12 Responses

Report 2014-117: California Department of Corrections and Rehabilitation: It Must Improve Legal Compliance and Administrative Oversight of Its Employment of Retired Annuitants and Use of State-Owned Vehicles (Release Date: March 2015)

Recommendation #12 To: Corrections and Rehabilitation, Department of

To ensure that all employees with assigned vehicles submit the required documents, Corrections should provide training and guidance to staff and supervisors on its policy for monthly reporting of the personal use of vehicles to both its accounting office and the state controller by June 2015.

1-Year Agency Response

The Department's Accounting Division has completed the revision of the existing policy/procedure memo addressing the personal use of state vehicle reporting requirements and the process by which Accounting submits the information to the State Controller's Office. Training has also been provided to Accounting staff. Proof of practice will be provided via email.

California State Auditor's Assessment of 1-Year Status: Fully Implemented

6-Month Agency Response

Within the Department, the Office of Business Services issued a memorandum regarding Vehicle Home Storage Permits on June 30, 2015 which provides information to staff on the taxable fringe benefits of a state vehicle. Further review of the memorandum and attachments will take place at the next training with department wide fleet staff. The meeting will include key contacts from institutions and programs statewide. The Division of Adult Parole Operations developed a comprehensive policy revising existing state vehicle use and operation procedures. The revision includes the proper reporting of personal use of state vehicles to the IRS and the Franchise Tax Board. The policy was issued to staff on 6/30/15. In addition, an e-learning training is in the development phase which will provide further emphasis on the policy and the recommendations provided by CSA. Lastly, the Board of Parole Hearings has established procedures for Vehicle Home Storage Permits and provided training to Executive Officers, Commissioners, and Associate Chief Deputy Commissioners on June 15, 2015 and to Deputy Commissioners on June 16, 2015 on the Vehicle Home Storage Permit Process and the process when issued a state vehicle. During the training, the taxable reporting requirements when using a state vehicle for personal use was also discussed as one of the responsibilities of a driver of a state vehicle.

California State Auditor's Assessment of 6-Month Status: Partially Implemented

While Corrections provided training and guidance to staff and supervisors on its policy for monthly reporting of the personal use of vehicles to its accounting office, it has yet to provide similar training and guidance for monthly reporting of the personal use of vehicles to the state controller.

60-Day Agency Response

Employees within multiple divisions of CDCR are assigned vehicles, therefore the divisions are addrssing this recommendation accordingly. Office of Business Services (OBS): OBS will issue a memorandum that reminds employees that personal use of a state vehicle may be reportable as a taxable fringe benefit in accordance with the Internal Revenue Service; Division of Adult Parole Operations (DAPO): DAPO will revise and reissue its policy and procedures regarding the authorized use and operation of assigned State vehicles which will include details regarding training of all employees with assigned vehicles regarding the required documents and monthly reporting of personal use of vehicles to both its Accounting office and the State Controller's Office. DAPO Unit Supervisors will provide the training on the new policy and will provide documented proof via a CDCR Form 844, Training Participant Sign-In Sheet; Board of Parole Hearings (BPH): On March 16, 2015, training was provided to all affected staff during a scheduled board meeting, including review of CDCR form 1804, mileage logs, and personal use of state vehicles (BPH Attachment 1). Since then all Commissioners have submitted their forms which have timely been forwarded on their behalf to Accounting. The Facilities Analyst will validate that all affected Associate Chief Deputy Commissioners and Deputy Commissioners submit their forms and that the documents are forwarded to headquarters Accounting. The Chief of Administration is currently building these processes into procedures and updating training materials. These updated materials will be distributed and administered by June 16, 2015. Proof of practice materials will be made available at that time.

California State Auditor's Assessment of 60-Day Status: Pending

All Recommendations in 2014-117

Agency responses received are posted verbatim.