Appendix A

Scope and Methodology

The Audit Committee directed the California State Auditor to determine how the department allocates resources for its role as a responsible agency under CEQA. Specifically, it directed us to determine whether the department is meeting its statutory requirements for CEQA, to assess the adequacy of its CEQA staffing, and to determine how it manages its funds to meet its CEQA responsibilities. Table A outlines the Audit Committee’s approved objectives and our methods for addressing them.

Table A
Audit Objectives and the Methods Used to Address Them
AUDIT OBJECTIVE		METHOD
1	Review and evaluate the laws, rules, and regulations significant to the audit objectives.	Reviewed relevant laws, rules, and regulations related to the department’s CEQA roles.
2	Determine how frequently over the past five years the department received requests to be a responsible agency for a CEQA review and its actions in response to the requests.	For the last five years, identified the number of CEQA documents the department has been asked to comment on according to its project tracking database and identified how many requests it reviewed and responded to.
3	Review a selection of CEQA requests where the department was a responsible agency and determine whether it met statutory requirements. If it did not meet statutory requirements, identify the major reasons why not.	Judgmentally selected 20 projects for which the lead agency completed CEQA documents and for which the department was a responsible agency. We evaluated whether the department fulfilled its CEQA role as a responsible agency for these projects by examining its comments and the timeliness of its response to the CEQA documents. We selected and reviewed projects from regions 2 through 5, since they received the most CEQA documents in the past five years. Reviewed the department’s process for consulting with lead agencies before their submission of CEQA documents. Evaluated the department’s process for deciding whether to review documents during the CEQA process. Identified and analyzed the factors that contributed to instances when the department did not meet its CEQA responsibilities.
4	Review and assess the sufficiency of the department’s allocation of resources. In particular, perform the following:
	a. Assess whether it employs a sufficient number of staff to meet its CEQA-related legal obligations as a responsible agency.	Calculated the department’s number of CEQA‑funded positions for the past five fiscal years. Interviewed department staff and reviewed the department’s most recent report on its fiscal analysis of CEQA activities to obtain the department’s perspective on its CEQA staffing levels. Reviewed the department’s CEQA workload tracking practices.
	b. Identify the expenditure and staffing levels for other functions within the department unrelated to CEQA and, for those functions, assess the department’s justification for its staffing and expenditure levels. To the extent possible, identify opportunities to reduce these levels to fund CEQA‑related activities.	Analyzed the department’s revenue sources and determined whether it could reallocate funds for CEQA review. Identified the department’s revenues and budgeted expenditures for its major program areas in fiscal year 2018–19 in Appendix B. Interviewed department staff to determine the department’s justification for its General Fund expenditures. Reviewed staffing levels to identify if the department could reallocate any chronically unfilled General Fund positions to CEQA review. We determined that the department has had no General Fund positions unfilled for more than 6 months that it could have reallocated to CEQA.
	c. Identify how each major function is funded, including its CEQA process and habitat management. Further, determine the percentage of staff dedicated to habitat management.	Identified the department’s major program areas and their funding sources. Calculated the number of staff in the department’s conservation branch, which includes staff who work in habitat management, as of fiscal year 2018–19. Analyzed the conservation branch’s staffing level relative to the department as a whole.
5	Determine whether the department’s CEQA process affects its other programs and whether there are opportunities—such as early participation in the process—that could benefit those other programs.	Judgmentally selected and analyzed 12 LSA agreements where the department had not commented during the CEQA process. Determined the effects of the department’s not commenting on CEQA documents on the LSA agreements by adding these 12 judgmentally selected projects to 13 of the 20 projects selected for Objective 3 for which the department issued LSA agreements. For these 25 projects, we compared how long the department took to issue LSA agreements for projects on which it commented during CEQA versus for projects on which it did not comment. Reviewed the department’s reports from its project tracking database to determine the number of LSA agreements that proceeded through operation of law and interviewed department staff to determine the department’s perspective on why projects proceed through operation of law. Reviewed litigation related to permitting and CEQA.
6	Determine how the department manages the funds received from CEQA fees and whether it expends or refunds the funds in compliance with state law and in a manner consistent with meeting its CEQA responsibilities. In particular, determine how the department manages these funds in cases where it does not respond to requests from local governments.	Reviewed the department’s process for collecting fees to determine if it ensures that lead agencies pay appropriate fees. Reviewed the revenue and expenditures for CEQA and programs unrelated to CEQA for the past five fiscal years to determine if any unrelated programs may be using CEQA filing fees for funding. Obtained documentation for cases within the past five years when project applicants submitted refund requests and determined whether the department issued the refunds.
7	Review and assess any other issues that are significant to the audit.	Identified what steps the department took to resolve the data issues that it identified in its 2012 fiscal analysis of CEQA activities report to the Legislature. We also reviewed the department’s practice of mailing paper CEQA documents to its regions.

Source: Analysis of the Audit Committee’s audit request number 2018-119, as well as information and documentation identified in the column titled Method.

Assessment of Data Reliability

In performing this audit, we relied on electronic data and physical files that we obtained from the department and the State Clearinghouse. The U.S. Government Accountability Office, whose standards we are statutorily obligated to follow, requires us to assess the sufficiency and appropriateness of computer‑processed information that we use to support our findings, conclusions, or recommendations. We obtained financial information for CEQA revenue and expenditures, verified the datasets, and conducted testing of key data elements. We determined the data were sufficiently reliable for our purposes. We also obtained data from the department’s project tracking database that recorded the department’s CEQA activities. Based on conversations with the department and with staff at each of the regional offices, as well as our own observations of the data, we determined that the project tracking data are incomplete and that the department’s data entry is inconsistent. However, this database is the only comprehensive source of data the department has on its CEQA review activities and is the source the department uses to generate reports on its activities to the Legislature. We performed supplemental tests, based on available information, to gain some assurance that the data would support our conclusions and recommendations. We recognize that the limitations in the department’s data may affect the precision of the numbers we present. Nevertheless, there is sufficient evidence in total to support our audit findings, conclusions, and recommendations.

Appendix B

The Department's Positions and Expenditures by Funding Source

As part of an audit objective, the Legislature asked us to identify the staffing levels and funding for each of the department’s major program areas. Table B lists the department’s budgeted positions and expenditures for each of the department’s seven program areas, as well as its administration, for the 2018–19 fiscal year. The table also identifies key revenue sources for each program area. Much of the department’s funding comes from revenue dedicated to specific purposes, often from fees. For example, the environmental plate fund contains revenue from a fee paid by individuals who choose to obtain special license plates. The Fish and Game Preservation Fund includes a number of different fees, including hunting and fishing license fees and CEQA filing fees.

Table B
Budgeted Positions and Expenditures by Source for the Department’s Major Program Areas
Fiscal Year 2018–19
		FUND SOURCE
PROGRAM AREA	BUDGETED POSITIONS	GENERAL FUND	CALIFORNIA ENVIRONMENTAL LICENSE PLATE FUND	FEDERAL TRUST FUND	FISH AND GAME PRESERVATION FUND	REIMBURSEMENTS	OTHER FUNDS*	TOTAL 2018–19 BUDGET
Biodiversity Conservation Program	704	$68,876	$8,179	$13,955	$14,040	$19,553	$163,925	$288,528
Hunting, Fishing, and Public Use Program	435	9,800	843	21,770	39,868	1,343	26,455	100,079
Management of Department Lands and Facilities	370	6,878	3,322	18,640	12,200	6,525	26,579	74,144
Enforcement	218	33,879	2,689	4,735	39,342	3,774	8,730	93,149
Communications, Education and Outreach	23	361	937	3,133	125	121	26	4,703
Spill Prevention and Response	171	288	0	151	1,627	3,049	37,082	42,197
Fish and Game Commission	10	721	148	0	760	0	0	1,629
Administration^†	142	—	—	—	—	—	—	—
Totals	2,073	$120,803	$16,118	$62,384	$107,962	$34,365	$262,797	$604,429

Source: Analysis of the department’s fiscal year 2018–19 enacted budget.

* Other funds includes funds budgeted for local assistance and other funds budgeted for specific purposes, such as the Salton Sea Restoration Fund and the Hatcheries and Inland Fisheries Fund.

^† Administrative costs—budgeted at $50.6 million in fiscal year 2018–19—are distributed to each of the other program areas and included in those totals. The department allocates these costs to each program based on an internal model it develops annually.