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Health Officer Charges Dept. With Misuse of Public Funds By MATTHEW ARTZ

Friday June 03, 2005

Berkeley’s outgoing health officer has charged that her bosses have mismanaged a bloated department and are jeopardizing services by using public health funds to pay for unnecessary bureaucracy. 

“We know the level of administrative support we need and it’s less than what we are paying for,” said Dr. Poki Namkung. After 10 years as Berkeley’s health officer, Namkung departs today (Friday) to take a similar post in Santa Cruz County.  

She contends that the budget proposed for Berkeley’s Health and Human Services Department overestimated funding from the state and federal governments to justify raiding the city’s public health reserve fund to pay for staff costs this year.  

When she presented city brass with a less rosy budget forecast, Namkung said she received a memo from City Manager Phil Kamlarz ordering her not to further disclose her concerns to the City Council. 

Berkeley’s public health program provides health services, such as medical care and disease prevention programs to city residents.  

HHS Director Fred Madrano, the target of much of Namkung’s and the commission’s criticisms, said the department’s proposed budget was based on sound accounting and that proposals to streamline it would not save money.  

In her final months on the job, Namkung hasn’t just critiqued her department, she has sought to dismantle it. 

With Namkung’s assistance, Berkeley’s Community Health Commission in April unanimously recommended splitting the department into two autonomous programs: a Mental Health Department and a Public Health Department. 

The health commission’s proposal is based on findings that since 1999, while HHS’s scope of responsibilities has decreased, the department has not done enough to cut down on administrative staff. 

HHS now oversees public health, mental health, environmental health and senior programs. Before 1999, it was also responsible for programs serving the homeless, city youth and the unemployed. 

With fewer responsibilities, Namkung said that Madrano no longer needs four staffers working directly under him. “Look at any other department director in the city. They don’t have that kind of support,” she said, adding that the state health officer, with a staff of 2,000, manages with only one administrative secretary. 

The restructuring proposal would save Berkeley’s general fund an estimated $900,000, in part by reducing the need for administrative staff including the department’s director and deputy director, according to Tom Kelly, the commission chair. 

The City Council is scheduled to review the plan later this month, but it likely won’t come with a recommendation from city leaders. 

“I don’t think it’s realistic,” said City Manager Phil Kamlarz. “In my experience when you make things smaller, it costs more money.” 

Kamlarz said he was hesitant to reorganize HHS because the department, which receives nearly two-thirds of its funding from outside grants, requires extra accounting support. 

“I don’t think [the commission] appreciates the administrative burden it takes to do the accounting,” he said, adding that he thought centralizing the administration under Madrano had helped the department function better. 

Another skeptic is Mental Health Manager Harvey Turek. He said he thought the department’s structure was sound and commission report was “vague” about the expected cost savings. 

According to the commission report, since 1999, HHS administrative costs have risen 66 percent from $801,165 to $1.328 million while the scope of responsibilities decreased because of the transfer or elimination of over $11 million for programs and services.  

“This begs the question of whether or not we need the same degree of administrative support,” Kelly said.  

Madrano countered that since 1999, the department had reduced its overall administrative staff from 19 full-time positions to 15.8 next year and that administrative staff has held steady at about 7 percent of the total department workforce. 

Namkung and the commission have challenged Madrano’s figures, arguing that administrative staff has in fact increased over the past six years. According to department budget reports, HHS has cut its administrative staff from 16.5 positions in 1999 to 15.8 positions this year. 

Namkung and the health commission raised their objections after HHS revealed its proposed fiscal year 2006 budget. Required to reduce spending by 10 percent and minimize staff cuts, the department shifted $304,248 in employee costs from the city’s general fund to a city reserve for pubic health programs. 

The reserve, funded by state money, is currently $3.3 million in the black. Madrano projected that with the cost shifts the fund would remain healthy enough over the next five years to support programs should their costs rise or funding decline. 

Namkung countered that with state money less certain, federal funds dwindling and employee costs on the rise, the department would eat up the reserve within three years, placing programs at risk. 

As the city manger tried to mediate between dueling departmental budgets, according to Namkung, he also tried to keep Namkung’s analysis from going public. She said that in a letter dated May 3, Kamlarz reminded her that under Berkeley’s form of government she was not to have written or oral communication with the mayor or council. 

“To be told that I can not speak about these issues to policy makers who have control over the funds, I think is unethical and wrong,” said Namkung, who had previously copied councilmembers on a letter to Kamlarz about the budget. 

Kamlarz said Thursday that city policy was for employees to take their concerns to him first, rather than going public. 

Berkeley has a track record of misappropriating public health money. In 2000, the city had to backfill the public health reserve fund $2.4 million after the state determined that since 1993 Berkeley had illegally used the money to pay for other city expenses. 

The commission’s proposal would not end the practice of shifting employee costs to program grants. The plan would eliminate several administrative positions and then shift the rest to the newly created Public Health and Mental Health departments. Administrative staff under the new departments could be paid from grants, rather than the city’s general fund. 

According to the report, Public Health, the largest division in HHS, would require 3.5 full-time employees to carry out its administrative tasks. 

Kelly, fearing that city leaders would be hostile to such a major upheaval, hoped that the city would allow an independent analyst to review the commission proposal. 

“I think the city is obligated to at least take a look at this and see if there is a way to save money without cutting services,” he said.