Three special districts in Marin have failed to submit state mandated financial audits to the county’s Department of Finance, according to a new report.

The Marin County Civil Grand Jury report — titled “Who’s Minding the Store?” — says the Marin City Community Services District didn’t file an audit for the 2020-21 fiscal year; the Firehouse Community Park Agency in Bolinas failed to file one for 2015-16; and the Alto Sanitary District didn’t file one for 2022-23.

The late filings mean “the constituents of these agencies may not have access to important financial information, which allows them to make informed decisions regarding the effectiveness of those agencies in performing their duties and responsibilities,” the report says.

Over the years, the grand jury — which is empowered by the local judiciary to investigate government performance — has produced several reports on the nearly 100 agencies that operate as special districts or joint power authorities in the county. The new report focuses on how well these agencies comply with financial reporting and transparency requirements imposed by state law.

Based on the audit reports on the agencies’ websites for 2024, they have a combined revenue of nearly $1 billion, the grand jury said. The agencies are funded by property taxes, sales taxes, customer service fees and other revenue sources such as grants.

“The grand jury found several instances where mandatory financial reports were submitted late, with no penalties imposed on the offending agency,” the report says.

The grand jury also said a large number of the agency websites failed to comply with the state’s website transparency requirements, also without consequence.

The Alto Sanitary District and Firehouse Community Park Agency have both posted audited statements for the years in question on their websites.

No financial information is available on the Marin City Community Services District website. On the “audit reports” page, it simply says: “Coming soon!”

State law also requires that each agency submit annual financial transactions reports to the California State Controller’s Office within seven months of each fiscal year’s end.

According to the report, the Marin City district also failed to file with the controller’s office for the 2021-22 fiscal year.

The grand jury says state law grants the Department of Finance the authority to obtain an audit on its own, and on behalf of any special district or joint powers authority, when the agency fails to submit a timely audit.

The jurors reported finding several instances of late or missing audits over the past 14 years. However, it found no evidence the Department of Finance ordered audits on behalf of those delinquent agencies.

The grand jury stated that when it asked for an explanation, “the Department of Finance replied that its approach has been to work collaboratively with agencies and provide support to them.”

Mina Martinovich, the county’s finance director, was traveling this week could not be reached for comment. Sandy Kacharos, the assistant director, said she couldn’t directly address the issues raised in the report, but said Martinovich has a weekly meeting with representatives of the Marin City district.

“The subject of their financial statements and their audits is front and center in those conversations,” Kacharos said, “as is their budget and cash flow and all of those things that wrap around that.”

The Marin City agency is a special district the Board of Supervisors created in 1958 to provide recreation services to the unincorporated neighborhood. The district also oversees garbage services and street lights.

The district has experienced financial management problems in the past. Its expenses exceeded its revenue in 2015, 2016, 2017 and 2018.

In 2018, Roy Given, the former county finance director, began working with the district. Around that time, the district was at the peak of its financial crisis and $125,000 in debt, Given has said.

In fiscal year 2019-20, the district reported $1.3 million in revenue and $1.1 million in expenses. It is funded primarily through property taxes and grants.

In 2021, the district’s fiscal administrator, Bruce Palmore, and its general manager, Don Lancaster, both announced within days of each other that they were resigning. Neither would comment on their reasons for leaving.

Since then, district employee Juanita Edwards has been the acting general manager. Edwards could not be reached for comment, and neither could longtime board member Terrie Green.

As for the Firehouse Community Park Agency and the Alto Sanitary District, both appear to have filed financial reports with the finance department since the grand jury published its report.

Bill Hansell, the Alto district manager, said he was delayed in filing the report because of a fire that destroyed about a third of his house. Hansell is the district’s only employee and works part time.

Hansell said he has worked for the district for nearly 10 years and this is the first time he has missed the deadline. The district’s 2022-23 financial report shows that its assets exceed liabilities by $4.4 million.

The Firehouse agency’s financial statement for fiscal year 2015-16, which is posted on its website, shows that its assets exceeded liabilities by $104,050. No representative of the agency could be reached for comment. The district is responsible for maintaining Mesa Park and Downtown Park in Bolinas.

Kacharos said the county has “regular and frequent interactions with our special districts, and with a few minor exceptions, they’re well-functioning and fiscally sound.”

Hansell, however, said that prior to the grand jury investigation, “I don’t recall ever being asked by the county to submit Alto’s audits.”

Hansell said he used to manage the Muir Beach Community Services District, and when he started working there, “they hadn’t done audits in nine years at all.”

The grand jury is recommending that the Marin County Board of Supervisors implement a process to conduct audits on any agency more than a year behind in its mandatory financial filings.

The grand jury report is online at shorturl.at/OAPNk.