'No Kill' Alert! LA City Trust Funds May be Used for Feral Cats and 'Free' Pets

The regulations on expenditure of donated spay/neuter money (along with a special annual allocation by the City Council) and the development of a voucher system were carefully put in place to assure donors that their money would be reserved for the benefit of owned pets of Los Angeles residents, to reduce unintended breeding and overpopulation. More recently it has served to assure low-income Angelenos can comply with LA's spay/neuter law and was expanded to include all dog, cats and rabbits adopted from city shelters. 

Donors have been generous through the years, and these funds have also prospered from large donations from estates because their "trust" status assured they would not be used other than as designated. 

ED BOKS' "FELIX" PROGRAM 

During Ed Boks' tenure as LAAS General Manager (2006-09) the Animal Sterilization trust account was unlawfully used for thousands of feral (wild/stray/unsocialized) cats under a program he called, FELIX. The massive drain on the Fund caused LA Animal Services to run out of allotted vouchers to subsidize spay/neuter of owned pets -- often two weeks into the month. It was also discovered that, in some cases, more than one voucher was used per feral cat, and there were other accounting issues. 

The expenditure on feral cats cannot be accurately audited because they are trapped, neutered and released, and there are no traceable owners. This resulted in a Controller's audit that found this misuse of the Trust Fund donations and quickly demanded this unauthorized practice stop. 

BARNETTE WANTS TO REMOVE SAFEGUARDS 

Council members who founded these trust funds wisely realized they had to keep unrestricted access out of the hands of ambitious city managers and greedy politicians and avoid any method by which donations could end up in the City's coffers. 

But suddenly, in two parallel efforts, GM Brenda Barnette is seeking, or has gained approval of, proposals to “re-purpose” funds from these Trusts. And, the City Attorney has not issued any admonition or taken this under advisement and seems to be in lock-step agreement. 

DONORS NEED TO BE AWARE 

Attorneys who prepare wills or trusts and may have informed animal-loving clients that bequests made to these trust accounts are protected by designated limitations, must be aware of proposed changes. Several legal advisors said this may also warrant legal challenges or a class action lawsuit, if existing funds in these accounts are used for purposes other than described in the trusts. 

Thousands of donors who have given large amounts without indicating specific use restrictions or those who just include a donation with their dog annual license for "Pet Sterilization" and/or "Animal Welfare" should note carefully how their money may be spent if recommendations in Council File 17-0413 (Citywide Cat Program - Personnel & Animal Welfare Committee Report) are successful  and GM Brenda Barnette's newest proposal, approved by the Commission at its Sept. 26, 2017 meeting, Council File 17-1411 (still in Mayor's Office/pending PAW Committee hearing) are passed. 

Here are some of the tedious, but important, details: 

ANIMAL WELFARE TRUST FUND (Cash balance as of 5/31/2017 - $2,845,825.61) 

Current designation: 

Animal Welfare Trust Fund: Administrative Code Section 5.200 (Chapter 12, Article 4). 

(b) The Fund shall be used to augment established programs and activities of the Department of Animal Services, other than those involving pet sterilization, and may be used for the acquisition, construction and maintenance of land and capital improvements and the purchase of equipment, services or furnishings in support of such programs and activities, subject to any special terms or conditions attached to individual gifts, contributions or bequests to the City. 

(c)  See below, minus the underlined changes by GM Barnette. 

Changes Proposed by Brenda Barnette (underlined): 

(b) The Fund shall be used to establish new programs in addition to augment established programs and activities of the Department of Animal Services. . . 

(c) Monetary gifts, contributions or bequests to the City, to the Department of Animal Services, to a division or operation thereof or to the General Manager thereof for the acquisition construction and maintenance of land and capital improvements or, for the full or partial payment of animal shelter adoptions, microchip and/or redemption fees in connection with specified adoption events or for programs for low income persons, or for the purchase of equipment, services or furnishings in support of the programs and activities of the Department of Animal Services, other than those involving pet sterilization, which exceeds in value the sum of $25,000, shall be submitted to the City Council for acceptance or rejection. Such monetary gifts, contributions or bequests, the value of which is $25,000, or less, may be accepted or rejected for the City by the General Manager of the Department of Animal Services. 

WHAT DOES THIS MEAN TO DONORS? 

Note:  In (b) there is no limitation on the cost or nature of "new programs" the GM could establish.

And, in (c) these expenditures differ widely from the designated purpose of the Animal Welfare Trust Fund. In fact, the payments recommended by GM Barnett would generate revenue for the City's General Fund in the form of paying for waivers from City charges and paying adoption fees for "free" pets for those who can't afford them. 

ANIMAL STERILIZATION FUND. [Pet Sterilization Fund.] (Balance on 5/31/2017 - $4,081,432.40) 

Current Designation: 

Animal Sterilization Fund: Administrative Code Section 5.199 (Chapter 12, Article 3). 

• There is hereby created and established within the Treasury of the City of Los Angeles a special trust fund to be known as the "Animal Sterilization Fund," hereinafter referred to in this article as the "Fund." 

• Subject to any special terms or conditions of individual gifts, contributions or bequests to the Fund, the Fund shall be used to provide pet sterilization services to residents of the City of Los Angeles who meet applicable program eligibility requirements, as established by the General Manager of the Department of Animal Services (hereinafter referred to in this Section as the "Department") and approved by the City Council; and for dogs, cats and rabbits adopted from City animal shelters by other persons. 

Changes Proposed by GM Barnett/Councilman Paul Kortez/L. Bureau of Engineering: 

The LA City Bureau of Engineering, which sent out a NOTICE OF PREPARATION dated August 31, 2017, states it is "...preparing an environmental impact report (EIR) for the proposed Citywide Cat Program...which would be administered by the City's Department of Animal Services.” 

(The City budgeted $800,000 for this report - See LA’s Animal Services Chief Thinks $800,000 Feral Cat Study is a ‘Budget Priority’ and  Mayor Garcetti OK’s $800,000 for Feral Cat Report While the City’s Homeless Struggle.) 

Among the components of the proposed Project are: 

"Engaging in or providing funding for the spaying or neutering of free-roaming cats (feral or stray) to be returned where they are found...." AND, 

"Adopting changes to the City administrative and municipal codes related to accessing funds from the City's Animal Sterilization Fund to spay/neuter free-roaming cats..." 

WHAT DOES THIS MEAN TO DONORS? 

Note: This proposal is a clear violation of the restrictions of use for moneys donated to the existing Animal Sterilization Fund, which is specified solely to spay/neuter of "pets." Just as in the Boks era, the funds donated by estates and individuals will be swallowed up by surgeries for many of the estimated 3.5 million feral cats in the City (LAAS estimate), depleting or exhausting the amount donated exclusively for sterilization of pet dog and cats. 

Additionally, there is NO ABILITY TO AUDIT THE USE OF FUNDS ON FERAL CATS because there is no traceable owner. 

TRUST FUND ACCOUNTING GUIDE AND FINANCIAL/TAX EXPERTS 

Legal experts and the U.S. Government Publishing Office Trust Fund Accounting Guide, remind government bureaucrats that, “The Trust Funds group consists of funds that are designated by law as trust funds.” 

And, Analytical Perspectives states, "...the income of a trust fund must be used for the purposes specified.” 

A retired IRS attorney and a former City analyst agreed that, since the Council created the original ordinances, it can change the wording for future donations and purposes by amendment. However, the existing balances in either funds cannot be used for “new” purposes (differing materially from the original description) because they are held in trust under the existing/past designations. 

Both also advised that since these long-standing Trust accounts are still the source of on-going solicitations, it would be advisable to start NEW ACCOUNTS for other purposes, rather than risk accusations or legal actions for possible misuse, misrepresentation, or commingling. 

LEST WE FORGET - BRENDA BARNETTE'S PAST 'PROGRAMS' 

When considering allowing GM Brenda Barnette carte blanche with donated funds in the Animal Welfare Trust Fund, let's not forget some of her past "new" programs. Do we trust her (or the Commission's) judgment enough to give her full control over how large amounts of money donated for shelters and pets will be spent? 

Animal Services GM Barnette Says Animal Shelters Need Puppies to Increase Revenue. Brenda Barnette, issued a report on June 23, 2013, (after the LA puppy mill ban) recommending the Department stop late-term spaying in LA City shelters and foster pregnant dogs and their puppies, because, “Fostering puppies until they are eight weeks old, and returning them to Animal Services to be adopted out, represents additional revenue opportunities through adoptions to the public or through pet shops.” 

Foster Shelter Animals In Basements, Bathrooms and Garages!  On October 21, 2010, General Manager Brenda Barnette issued a news release: "Immediate Foster Homes Needed! Our Animal Care Centers are filled to over flowing. You can become a volunteer hero by opening a spare room, garage or basement to an adult dog or cat that will benefit from home care and a break from the shelter...All you need is a room (even a bathroom) and some spare time.”  

Brenda Barnette: 'No Night Care for Animals in City Shelters'    The on-going tragic implosion of Los Angeles Animal Services continues in an undated communication from General Manager Brenda Barnette, entitled, “Graveyard Shift Change for Animal Services,” sent out on March 14, 2013. She states, “At the end of this month, Animal Services will not have Animal Care Technicians (ACTs) in the shelters from midnight until 6 a.m….We believe this is a prudent management move and one that benefits both employee welfare and will improve services to animals in our care.” 

'Finders, Keepers': LA Doesn't Want Your Lost Dogs or Cats in City Shelters. If your dog or cat goes missing in the city of Los Angeles, Animal Services GM Brenda Barnette has a plan to keep it out of her shelters. Her proposal was approved on May 23, 2017, by the Animal Services Commission . . .There was no discussion about the welfare or safety of pets and no probing questions as to the logistics that would make this cumbersome, confusing and risky policy viable. Barnette's "finders-keepers" proposal is to allow lost pets to stay with a person who picks them up and reports this to the shelter.  

THE CITY'S TRUST FUNDS ARE CRITICAL TO LA ANIMALS' FUTURE 

The Animal Welfare Trust Fund and the Animal [Pet] Sterilization Fund were established for specific purposes under ordinances and codified in the LA Administrative Code. Residents of Los Angeles and other animal lovers have donated for decades, confident that the very large existing balances would be spent for the purposes stated in the Trusts. 

According to experts, the existing money cannot be spent on the new purposes proposed if they differ from the designated purposes for which they were donated. 

The City Council and Mayor should consider the consequences -- civil and, according to experts, even criminal -- should the purposes of Trusts not be specifically followed. 

The City and GM Barnette can start new charitable funds for feral cats, "free" pets, and other "no kill" programs by LA Animal Services, rather than potentially face accusations or legal actions for possible misuse, diversion or misrepresentation in the name of animals. The risk is just too great!

(Phyllis M. Daugherty is a former City of LA employee and a contributor to CityWatch.) Prepped for CityWatch by Linda Abrams.

-cw