Years Of Bad Accounting Threaten Harney County Health Programs

Harney County’s leadership has been miscounting public money for years and is trying to make up the difference with drastic budget cuts.

The Harney County Court faced a standing room only crowd at the fairgrounds Tuesday, as it explained why this is no typical shortfall. Eliminations could include public health services and aspects of law enforcement.

"The Harney County Court is taking immediate action to make it through this fiscal year without going into debt, but we must find a way to operate on approximately $1 million less than we usually budget, not just for a few years, but as the new normal," officials explained in a stunning April 29 announcement.

Harney County has about 7,300 residents. The local government is the only entity providing certain services, like hospice care and a walk-in medical clinic. That $1 million is a 20% hit to the general fund. People who turned out at the fairgrounds wanted to know where the money went, but officials insisted it was never there to start.

“I know my colleagues have done nothing intentionally wrong, nor have I,” said Harney County Commissioner Patty Dorroh, “but, we change over. Elections come and go, and people just do what the last person showed them. I would like to professionalize our finances in the near future. We don’t have any money to do that right now.”

The County Court reported it doesn’t have any money in the general fund to start the next fiscal year, saying faulty accounting began after computer software was introduced in 2013. Believing it had money in reserves year after year, the county kept overspending — by roughly $2 million total over five years. No one has been publicly blamed individually or lost their job to date.

Layoffs may be coming, though. The county has until June 30 to adopt a balanced budget and has already introduced mandatory furlough days for about 100 employees. And leaders have said service reductions are now inevitable. The news unleashed anger, frustration and confusion.

“Are you qualified to get us out of this situation? Are there better people to help you?” Hilda Allison of Hines asked the Harney County Court. “I’d like you to really look at yourselves and say, ‘What do I know about finances? Can I run a computer, or not?’”

Related: Harney County Sheriff Who Led Community Through Malheur Occupation To Resign

The Harney County Sheriff's Office and jail, the library and the Health Department are all braced for cuts. Tuesday night's meeting was focused on what's at stake with public health. One issue that came up was the county's in-home nursing and hospice program. Without it, very sick and dying people would need to travel far from home for palliative care.

“We offer a service that is maybe not essential to you, but it is to anyone who’s ever received it,” said home health and hospice director Jodi McLean.

Health department director Jolene Cawlfield made the case for programs to vaccinate children, promote sexual health and prevent a long list of illnesses. These services use numerous funding sources, but state and federal grants don’t cover everything, Cawlfield said. Last year, the county nurses gave more than 1,000 immunizations, driving double-digit increases in the county’s immunization rate.

A walk-in medical clinic the county built in 2018 already serves 1,500 patients, but it too could be closed, according to manager Kelly Singhose.

“We do lots and lots of well child checks, acute care visits, [and] we take care of 75 foster children in Harney County,” she said.

The facility is in the process of being certified as a rural health clinic, a federal designation guaranteeing better insurance payments. Singhose projected a $500,000 turnaround next year. But that might not pay out fast enough for the county to recoup its investment. Harney County Commissioner Mark Owens was skeptical.

“That’s a tough number for my simple mind to justify,” he said. “That’s what started the conversation of trying to privatize.”

But even an ownership transfer would take more time than the county has to present a balanced budget.

The commissioners heard emotional testimonials from people describing how public health programs have helped them. Others wanted to know who was accountable for the accounting snafu.

“Is there going to be any kind of oversight committee?” asked Brad Herrera, introducing himself as a third generation rancher.

Harney County Judge Pete Runnels replied: “We’ve asked if the [Oregon] Department of Revenue, Department of Justice, or the Secretary of State would do any type of overseeing an audit or review … They don’t do those unless there’s a clear line of embezzlement.”

Runnels said there isn’t one, and that a forensic auditor from the same firm contracted to check the books for years will investigate more. Auditors with the Secretary of State's Office agreed with the county’s justification, in response to a complaint made to the Oregon Government Waste Hotline.

“It is our understanding the county judge [Runnels] pulled an incorrect financial report when drafting the budget,” the statement said. The incorrect report used projected fund balances, instead of actual ones.

“We will be taking no further action on this complaint and consider the matter closed,” officials from the Secretary of State's Office added.

But for people in this sweep of Eastern Oregon, the hurt is just beginning. Many want to know why the error wasn’t caught sooner.

Runnels, who said he first noticed and disclosed the inconsistencies in October of last year, said he has since asked auditors why the problem wasn’t flagged earlier.

“One of the answers I got was … the money [not just the general fund] is co-mingled in a bank account, so you’re looking at $17 million to $20 million a year on average so that $300,000 doesn’t jump out specifically,” he said.

As budget negotiations grow increasingly tense, the amounts cited have changed, too. Resident Dennis Rothgeb pointed this out at the meeting and asked how commissioners know cutting services will save enough money if they still don’t know for sure how much was overspent.

Owens replied: “We need to sit down and evaluate and see what the true number is. Honestly, I don’t have a straight answer for you now, sir, but we are working on it.”

Clarification: Harney District Hospital is governed by its own locally elected board.