The City of Hollister issues more than 100 credit cards to employees for purchases and maintains loose restrictions on who gets them.
That could all change soon.
Two weeks after the Free Lance filed an open records request for a plethora of data on city-issued credit cards used by employees—in response, a finance official has requested the maximum allowable extension to Sept. 11—the agenda for Hollister’s council meeting Tuesday includes an item to consider an extensive update to the policy governing government workers’ credit card use.
Council members at the 6:30 p.m. Tuesday meeting at Hollister City Hall, 375 Fifth St., are set to consider a resolution to approve a new credit card policy.
That update—the mayor told the Free Lance he supports increasing restrictions on credit card access—covers rules for who uses the Cal Cards, what they’re used for, and limits on individual expenditures capping out at $3,500.
A Hollister finance official—who confirmed the city issues more than 100 cards in the government organization with 142 budgeted employees—denied that the policy overhaul had anything to do with the Free Lance records request.
The newspaper submitted a request under the California Open Records Act on Aug. 18. Public bodies are given 10 days to respond but can request a 14-day extension, which the city did.
“It was about time we needed to update this thing,” said Brett Miller, director of administrative services, who denied the pending records request was related to the timing of the city’s policy consideration. “To me, it was outdated.”
The Free Lance records inquiry requested the city provide a total number of credit cards issued to employees, a list of expenses from the five council members who are among employees receiving credit cards, a total amount of expenses put on credit cards in the most recent fiscal year, and a document delineating all policies for credit card issuance and use.
Miller on Thursday confirmed that there is no current policy specifying exactly what positions are assigned cards, as department heads make those decisions, or how many cards are issued in each department and throughout the city. As for individual limits as they stand?
“Usually it’s $2,500 to $3,500 depending on what position,” Miller said, adding that department directors have higher limits.
He could not immediately provide a total dollar amount for credit card expenses from last fiscal year or city council spending data.
Although Miller said he has wanted to update the policy for several years, he also defended the existing practice that involves the city issuing more than 100 credit cards—while Hollister is budgeting for 142 employees this fiscal year, which means more than two-thirds of the workers have access to Cal Cards.
He contended that the practice offers more controls than other ways of accounting for expenses. Cal Cards have better security protections than traditional credit cards, he said, while an array of structured controls involve officials reviewing specific expenses put on the cards. Part of the reason for Tuesday’s consideration is because the city will receive new cards with more secure microprocessor chips installed, he said.
He also mentioned that just supervisors keep the credit cards on them, while other employees’ cards are kept in a safe and checked out.
“It doesn’t seem like there’s a better way of doing things,” Miller said.
The finance official contended that cash reimbursements for employees who purchase items for the city are unfair because the workers have to wait for the money.
“It’s kind of gone away,” he said. “People don’t really do charges anymore.”
He said it’s been a common practice to hand out the multitude of credit cards “just in case they’re the ones that have to respond or do something.” Miller said an example is with an emergency or disaster when police officers might need to get something at Target. He also said it could come in handy if a city employee is on a work-related trip and may prefer buying “beef sticks and peanuts” instead of eating an expensed dinner.
With the city credit cards, Miller also stressed that department heads must approve all the spending, which other officials then review.
The city’s consideration of a credit card policy comes in an era with heightened scrutiny of public spending by government entities, especially following the City of Bell corruption scandal uncovered by the Los Angeles Times in 2010. The San Benito County community, too, has experienced its share of theft by officials in influential positions, with six high-profile embezzlement cases involving public unions or nonprofit organizations in the past six years.
In the City of Hollister, former sheriff’s candidate and police Sgt. Ray Wood in 2012 was sentenced to six months in county jail for embezzling $102,000 from the Hollister police union where he had been president of the organization.
“You’re trying to compare an organization that had no internal controls to an organization that has internal controls,” Miller said.
Still, Mayor Ignacio Velazquez said the city should limit the number of cards handed out.
“I personally think only department heads and those in emergency services should have the cards,” Velazquez said.
He doesn’t believe council members need them.
“I think we’re better off turning in our receipts,” he said. “I don’t think it’s a good idea for council members to have them.”
Look back for more.
