Guest contribution — VCTA Demands Accountability on VCMS

ACCOUNTABILITY NOW

How Ventura County Medical System is Draining Taxpayer Dollars

This newsletter aims to inform Ventura County residents and encourage action from the Board of Supervisors and other decision-makers to adopt three steps it must take to restore public trust and ensure responsible financial management at the Ventura County Medical System (VCMS).

VCTA Calls for Financial Reform at VCMS at Jan 23^rdOversight Meeting

VCTA recently addressed the VCMS Oversight Committee, the body responsible for monitoring the finances of our taxpayer-supported public hospital. Our presentation highlighted serious concerns about current financial practices, particularly VCMS’s routine borrowing from the General Fund to cover cash shortages. This borrowing is used for everything from payroll to purchasing equipment because VCMS consistently budgets for a financial shortfall and relies on loans to make up the difference.

For years, the committee has approved budgets that plan for spending far beyond actual revenue – without a clear plan to close the gap, except by borrowing from the General Fund. This ongoing financial mismanagement puts taxpayer resources at risk and threatens VCMS’s long-term stability.

VCMS’s Financial Crisis: A Deeper Look

VCMS has long struggled with financial difficulties, often citing delayed state payments as the reason. However, a closer analysis reveals a more concerning pattern: VCMS consistently operates with a budget that assumes financial losses and relies on borrowing to stay afloat.

Adding to this issue, VCMS management provides conflicting financial reports- one version to the Board of Supervisors and a different one to the Oversight Committee.

For example, the approved FY2023-24 budget projected a net cash loss from operations. Yet, the budget provided to the Oversight Committee misleadingly suggested a positive net cash position (EBITA) by excluding $42 million in obligations, such as capital asset purchases and debt payments. This discrepancy means that both the committee and the public do not have a complete and accurate picture of VCMS’s financial health.

Three Key Reforms for Financial Stability

To restore public trust and ensure responsible management of taxpayer money, VCTA urges the Oversight Committee to implement the following reforms:

1. Standardized Financial and Budget Reporting: VCMS must present the same financial reports to both the Board of Supervisors and the Oversight Committee. Monthly reports should include all expenditures – such as capital purchases, debt repayments, and interest expenses – to provide a transparent and accurate view of VCMS’s financial position.
2. Balanced Budget Requirement: Unlike other county agencies, VCMS has been allowed to submit budgets that rely heavily on borrowing to cover operating expenses. This practice must end. Relying on borrowed funds for routine expenses – including capital costs and debt payments -is unsustainable and must be addressed immediately.
3. Address the $266 Million General Fund Debt: The Oversight Committee must take decisive action to manage the growing debt owed to the General Fund. One potential solution is to write off a portion of this balance as bad debt. This would provide clarity on VCMS’s financial position and set the stage for future accountability measures to prevent repeated fiscal mismanagement.

A Call for Oversight and Accountability

The VCMS Oversight Committee, acting on behalf of the Board of Supervisors, is responsible for ensuring financial oversight. The current practice of budgeting for deficits and then borrowing to cover them unfairly burdens taxpayers and undermines financial accountability. This must stop immediately.

Critical reforms are necessary. By implementing these three key changes, VCMS can take the first steps toward financial stability and responsible stewardship of taxpayer dollars.

We urge Ventura County residents to stay informed and advocate for these critical financial reforms. Your voice is essential in ensuring that our county’s healthcare system remains both financially stable and accountable to the taxpayers who fund it.

Join the Club and get involved!

LEARN ABOUT VCTA

About the Ventura County Taxpayers Association (VCTA)

Formed in 1954, The Ventura County Taxpayers Association is a 501(c)4 nonprofit organization dedicated to a non-partisan, fact-finding mission, emphasizing issues that affect Ventura County. We inform taxpayers, promote the wise use of public funds, oppose waste, advise public officials regarding issues of concern to taxpayers and recommend positions that will best serve the taxpayers’ interests. Our number one goal is to promote the wise use of public money and to oppose waste.

Ventura County Taxpayers Association

PO Box 3878

Ventura, CA 93006

info@vcta.org | vcta.org