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Financial Management for Elected Officials January 2013 <br /> <br />Institute for Local Government www.ca-ilg.org 20 <br /> <br /> <br /> <br /> <br />• Does the agency have policies in place for the proper disposal of surplus property? How has <br />staff been made aware of such policies? <br /> <br />• Is the agency alert to and actively monitor contract terms for cost escalators and automatic <br />renewals that can cause increases that can cause the agency to lose control of costs? <br /> <br />• Are staff responsible for purchasing decisions required to file annual disclosure statements <br />relating to economic interests and gift receipt (known as “Form 700s”)? <br /> <br /> <br /> <br />Limits on Agency Expenses/ <br />Proper Uses of Public Resources <br /> <br />Invariably, there are more worthy uses for public funds than there are funds available. Deciding <br />how limited public resources will be allocated is a key responsibility of elected officials, <br />although it is important to acknowledge that decision-makers may have less discretion than one <br />might expect in deciding how public monies are spent. <br /> <br />That being said, the law imposes some basic restrictions on how public resources may be used. <br />For example, any use of public resources must serve the needs of the agency’s constituents. <br />California’s Constitution expresses this principle by prohibiting “gifts” of public funds by the <br />Legislature, general law cities, and agencies created by state statute;33 some city charters also <br />contain this restriction. Agency counsel can provide guidance on the issue of what constitutes an <br />impermissible gift of public funds. An example, however, is a payment to another public agency <br />for their purposes, with no benefit flowing back to the donor agency’s constituents.34 <br /> <br />Along similar lines, personal or political uses of public resources also are not allowed.35 This <br />prohibition applies to not only public money, but also to anything paid for with public money <br />(for example, agency equipment, supplies and staff time). An example of how this prohibition <br />applies is that public resources may not be used for advocacy efforts on ballot measures. (For <br />more information, see www.ca-ilg.org/BallotMeasureLegalIssues). Elected officials should ask <br />how staff and newly elected officials are made aware of these restrictions. <br /> <br />Finally, local agencies must adopt expense reimbursement policies for elected and appointed <br />officials.36 Agency counsel should review the policy for compliance with state law. Most <br />agencies have adopted expense reimbursement policies for staff as a matter of sound practice. <br /> <br /> <br /> <br />Page 70 of 109