Sometimes a citizen’s questions concerning city matters sound more like allegations of wrongdoing.

That’s what happened during the March 21 and April 4 Lompoc City Council meetings when an individual spoke out during the public comment period and, according to staff report on May 2, made “several allegations related to the City’s management of its contract with Visit Lompoc.”

The May 2 staff report was an “Analysis and Response to Allegations” by the city attorney concerning those questions/allegations.

Several of this person’s claims were unfounded. Howevern some cause a reasonable person to scratch their head and ask, “how could this happen”?

For example, “claims that Visit Lompoc (VL) has submitted its annual report late every year from 2017 to 2023” was false. Why, because there is no deadline for these reports to be submitted; however the staff is required to present the reports to the City Council.

Following the receipt of the staff report Mayor Pro Tempore Dirk Starbuck, who presided over this council meeting, made a council request that the staff return with a status of contract compliance audits at a future meeting.

Starbuck made it clear this was not associated specifically with the complaints discussed in the report, but instead addressed the council’s responsibility to monitor contracts.

To understand why this was important, we must go back a few years to 2009 when a nonprofit, low-income housing provider doing business as the Lompoc Housing and Community Development Corporation (LHCDC) was the recipient of 52 separate Community Development Block Grant and Redevelopment Agency loans and grants.

At the time, the City Council and many prominent citizens wanted a “local organization” to provide low-income housing in the city. LHCDC seemed to fill that need, and since locals were on the Board of Directors no one seemed concerned about how they ran their business.

Then during a City Council meeting in October 2009, the Community Development director reported that nine of 12 properties for which LHCDC had taken redevelopment loans were noncompliant. However, all the loans were either already paid, or in good standing.  “Noncompliant” can mean paperwork hasn’t been filed on time.

Later, local press reported: “Of the three (LHCDC) loans that city staff said were still behind on payment, two dealt with Mark’s House, a homeless shelter for women and children. The city report listed two loans for the shelter as being more than a year in default, with more than $9,000 currently due.”

During a forensic audit it was discovered that LHCDC had very limited, well almost nonexistent financial records and that the executive director was keeping all receipts randomly tossed into a cardboard box. The city then suspended dealings with the nonprofit.

After this experience, the City Council formed an ad hoc committee around 2010, Councilman Starbuck was one of the members of this committee.

The council approved affordable housing contract audit policy #45 in May 2014. According to the City website: “this policy described responsibilities for non-profit partners, affordable housing providers, and affordable housing developers” and included monitoring those entities that received city funds (so an LHCDC couldn’t happen again).

I spoke with former city employees who are very familiar with this process; they told me the audit function for nonprofit housing never stopped at any point in time because it is a mandate from the U.S. Department of Housing and Urban Development.

According to information posted on the city website, the last audits were completed in 2017.  I reached out to city staff to see if this report was current; however as this commentary is submitted, I have gotten no reply.

Those entities that didn’t get audited normally would have to request a waive. For example, the Chamber of Commerce and the museum were caught in this situation even though they have zero to do with housing. The waiver could only be granted by the committee created by the policy; those committees didn’t meet during the COVID emergency.

So, the chamber, museum, and by extension Visit Lompoc LLC didn’t have to ask for a waiver for a couple of years.

To make it even more complicated, unlike the chamber and museum, Visit Lompoc LLC does not receive city funds, so the audit policy may not even apply to this operation.

So, fast forward to the current issue. Apparently, members of the City Council and the public may not understand the scope of the audit policy. Also, they may not understand that even though the finance staff are well qualified to do what they do, they are not trained or staffed to audit contracts; this is a specialized field and would probably require outsourcing. This may require additional funding from the council.

So, what’s next?  It seems like a workshop to widen communication between staff, the public and City Council on the subject may be appropriate to find out how much contract auditing the council thinks is needed, what it would accomplish, and just how much that would cost may be necessary to respond to Councilman Starbuck’s request.

May 2 staff report: https://www.cityoflompoc.com/home/showpublisheddocument/37577/638182066181100000.

Policy #45 description: https://www.cityoflompoc.com/government/departments/economic-community-development/community-development-division.

Housing audit findings: https://www.cityoflompoc.com/home/showpublisheddocument/100/636652698042900000.