D.A.’s office: No charges in Costa Mesa’s anniversary celebration
The Orange County district attorney will not file charges related to Costa Mesa’s 60th anniversary celebration, according to a letter sent to the police department Wednesday.
The district attorney’s office reviewed the investigative reports submitted by the Costa Mesa Police Department and other reports including the independent financial analyses prepared at the direction of the City Council and city staff.
The county’s chief enforcement agency also conducted interviews and “obtained additional information from the city,” according to the letter from Senior Deputy District Attorney Raymond Armstrong to the city’s Police Department.
“After reviewing all the information, we have concluded that there is insufficient evidence to prove any criminal activity, beyond a reasonable doubt, on the part of anyone connected with the planning and/or implementation of the event,” Armstrong wrote.
Wednesday’s letter wraps up roughly a yearlong investigation into the “60 & Fabulous” event. The three-day June party celebrated the city’s six decades of existence in 2013, but ended up thousands of dollars in the hole.
The summertime party cost about $518,000, of which the Costa Mesa Conference and Visitor Bureau — funded by hotel tax revenue — paid $232,000. The amount was nearly 10 times what the bureau originally agreed to.
The event generated $78,000 in revenue, including sponsorships, ticket sales and merchandise sales.
The city foot $209,000 of the bill, $84,000 more than the council’s original pledge of $125,000. The cost of the city’s investigation into the event added an additional $45,000, according to city estimates.
Two city employees, considered “principally responsible” for organizing the event were put on paid administrative leave in the wake of the party. One employee, Christine Cordon, an assistant recreation supervisor and special events coordinator, was reinstated months later.
In May 2014, after having been on leave for 10 months, Public Affairs Manager Dan Joyce was let go. He received $170,225 from the city in the form of a settlement agreement.
No money was found to be missing or used for personal gain, according to the city’s investigation.
However, city officials forwarded their findings to the district attorney’s office in 2014 for review.
The district attorney’s office did not determine whether city purchasing policies or bid requirements were adhered to or whether event organizers violated any other city policies while organizing the party, according to the letter.
In the city’s investigation into the event, officials said the party’s problems were brought on by unbudgeted growth, escalating costs, violation of city purchasing policies and poor cash control.
In the time since the event, city officials have instituted several reforms aimed at ensuring improprieties don’t happen again. The reforms included a refresher training course for all employees “to ensure the standard purchasing process is followed from start to finish.”
Still, some members of the public have called for a more comprehensive forensic audit of the event.
Councilwoman Katrina Foley requested during an April council meeting that staff obtain information from a third party about the scope and cost of a forensic audit.
A forensic audit involves an investigation and collection of information involving fraud that will be used for legal action. It is usually requested after fraud has been identified or suspected, according to a letter from accounting firm, Lance, Soll & Lunghard.
The cost of an audit depends on the situation, but would typically start at a range of $15,000 to $25,000. Because a forensic audit cost is typically billed at an hourly rate, the cost would likely increase based on the extent of work performed, the letter states.
The council is expected to provide direction to city staff regarding the possible need for a forensic audit during Tuesday’s meeting, according to the staff report.
Mayor Pro Tem Jim Righeimer said he’s interested to hear what comes up during the council’s discussion of the party.
“It seems to come down to the fact that city processes weren’t followed,” he said. “The question is how much more money do you want to spend proving that.”
Foley said that while she asked for the report, she is not in favor of the city pursuing a forensic audit. She asked for the information to inform the public, she said.
“I feel that the internal procedure has been reorganized and readdressed and the errors that caused the mismanagement of the 60th anniversary party have been corrected internally in a way that protects the taxpayers,” she said. “I’m ready to close this chapter and move forward.”