Report 2009-043 All Recommendation Responses

Report 2009-043: Board of Pilot Commissioners for the Bays of San Francisco, San Pablo and Suisun: It Needs to Develop Procedures and Controls Over Its Operations and Finances to Ensure That It Complies With Legal Requirements (Release Date: November 2009)

Recommendation #1 To: Pilot Commissioners for the Bays of San Francisco, San Pablo and Suisun, Board of

To ensure that it consistently adheres to requirements in state law when licensing pilots, the board should establish and implement a procedure for approving and monitoring board-appointed physicians.

Annual Follow-Up Agency Response From May 2014

The Board entered into an interagency agreement with the University of California, San Francisco Campus that sets forth, among other things, the following: the requirements to be a Board-appointed physician; a requirement for the BOPC Executive Directors pre-approval of all physicians; the duties of physicians to implement recently enacted medical assessment and fitness determination regulations found in 7 CCR, 217; and, a requirement that the BOPCs Executive Director meet annually with physicians to review processes and analyze experiences as part of a performance monitoring process.

California State Auditor's Assessment of Annual Follow-Up Status: Fully Implemented

The board's contract with the University of California, San Francisco campus includes a procedure for the university to provide names and resumes of physicians to the board and for the board's executive director to approve those physicians to perform the functions outlined in the contract.

Annual Follow-Up Agency Response From October 2013

A 101-page study entitled, "Pilot Fitness Study for the Board of Pilot Commissioners for the Bays of San Francisco, San Pablo, and Suisun," prepared by Dr. Robert Kosnik, MD of the University of California, San Francisco Medical Center, was delivered to the Board on May 26, 2011. The Board formally accepted the study on that day. The study provides 20 recommendations, most of which were adopted by the Board. These recommendations, once put into regulation, make substantial changes to Board procedures for pilot fitness determinations, including establishment of a two-physician fitness determination in a clinic setting.

The Board directed its Pilot Fitness Committee and Rules and Regulations Committee jointly to begin a series of public workshops that addressed the full range of recommendations from the study. The first workshop was held on July 19, 2011.

The Board had planned to commence administrative rulemaking to facilitate establishment and implementation of a procedure for approving and monitoring Board-appointed physicians in November 2012, followed by a competitive procurement for Board physician services. The public workshops took longer than anticipated and a draft of the proposed regulation entered formal public comment period on July 26, 2013. The 45- day public comment period ended on September 9, 2013, with one comment received and responded to in the "Final Statement of Reasons".

The final regulation is expected to be submitted to the Office of Administrative Law by the end of October 2013 (currently clearing the Department of Finance). An additional appropriation may be required in order for the Board to implement these changes by contracting with a clinic or medical group. Please see attached draft regulation.

California State Auditor's Assessment of Annual Follow-Up Status: Not Fully Implemented

The Board of Pilot Commissioners (board) has drafted regulations which outline the qualification standards for board-appointed physicians and describes the duties of those physicians. As the board states in its response, the draft regulations are not yet final.

Annual Follow-Up Agency Response From September 2012

A 101-page study entitled, “Pilot Fitness Study for the Board of Pilot Commissioners for the Bays of San Francisco, San Pablo, and Suisun,” prepared by Dr. Robert Kosnik, MD of the University of California, San Francisco Medical Center, was delivered to the Board on May 26, 2011. The Board formally accepted the study on that day. The study provides 20 recommendations that, if adopted by the Board, will make substantial changes to Board procedures for pilot fitness determinations, including recommendations that would establish a two-physician fitness determination in a clinic setting. The Board also directed staff to initiate the preliminary stages by contracting with a consultant to prepare a market survey of costs and other matters necessary. The Board has also directed its Pilot Fitness Committee and Rules and Regulations Committee jointly to begin a series of public workshops that will address the full range of recommendations from the study. The first workshop was held on July 19, 2011. The Board plans to commence administrative rulemaking to facilitate establishment and implementation of a procedure for approving and monitoring Board-appointed physicians in November 2012, followed by a competitive procurement for Board physician services. An additional appropriation may be required in order for the Board to implement these changes.

California State Auditor's Assessment of Annual Follow-Up Status: Not Fully Implemented

Recommendation #2 To: Pilot Commissioners for the Bays of San Francisco, San Pablo and Suisun, Board of

To ensure that its expenditures are appropriate, the board should competitively bid contracts with physicians who perform physical examinations of pilots.

Annual Follow-Up Agency Response From September 2015

The Board continues to agree with the intent of this recommendation. As explained in the Board's previous response submitted on 5/12/2015, the Board entered into a non-competitive interagency agreement with The Regents of the University of California, San Francisco Campus (UCSF) for the provision of pilot and trainee medical examinations and fitness determination services . The Board determined that a negotiated contract with UCSF, another state entity, was an efficient and cost effective method to procure medical examination services and remain in compliance with Government Code section 19130. Although the contract with UCSF was not entered into through a competitive process,the Board believes that it has complied with the primary guiding principle of this recommendation, which was for the Board to contract for physician services to ensure that it expenditures are appropriate. The Board's contract with UCSF successfully implements this recommendation.

California State Auditor's Assessment of Annual Follow-Up Status: Fully Implemented

We agree with the board's assertion that it has fully implemented the intent of this recommendation. The original recommendation to competitively bid for physician services was based on the fact that, at the time, the board was using different physicians at different clinics. However, subsequent to our audit report, the board enacted new regulations dealing with pilot physicals and pilot fitness. The board's agreement with a single entity, the University of California San Francisco, will enable it to ensure it receives appropriate services and monitor costs.

Annual Follow-Up Agency Response From May 2014

While the Board agrees with the intent of this recommendation, the Board will not implement this recommendation as specifically stated.

Instead of conducting a competitive procurement process with multiple private-sector physicians, the Board determined that it could efficiently and cost-effectively procure pilot medical assessments and fitness determinations with a single State entity, and entered into an interagency agreement with the University of California, San Francisco Campus for its physicians at the School of Medicine, Division of Occupational and Environmental Medicine to deliver the mandated medical assessments and fitness determinations required in regulations at 7 CCR, 217.

California State Auditor's Assessment of Annual Follow-Up Status: Will Not Implement

Annual Follow-Up Agency Response From October 2013

A 101-page study entitled, "Pilot Fitness Study for the Board of Pilot Commissioners for the Bays of San Francisco, San Pablo, and Suisun," prepared by Dr. Robert Kosnik, MD of the University of California, San Francisco Medical Center, was delivered to the Board on May 26, 2011. The Board formally accepted the study on that day. The study provides 20 recommendations, most of which were adopted by the Board. These recommendations, once put into regulation, make substantial changes to Board procedures for pilot fitness determinations, including establishment of a two-physician fitness determination in a clinic setting.

The Board directed its Pilot Fitness Committee and Rules and Regulations Committee jointly to begin a series of public workshops that addressed the full range of recommendations from the study. The first workshop was held on July 19, 2011.

The Board had planned to commence administrative rulemaking to facilitate establishment and implementation of a procedure for approving and monitoring Board-appointed physicians in November 2012, followed by a competitive procurement for Board physician services. The public workshops took longer than anticipated and a draft of the proposed regulation entered formal public comment period on July 26, 2013. The 45- day public comment period ended on September 9, 2013, with one comment received and responded to in the "Final Statement of Reasons".

The final regulation is expected to be submitted to the Office of Administrative Law by the end of October 2013 (currently clearing the Department of Finance). An additional appropriation may be required in order for the Board to implement these changes by contracting with a clinic or medical group. Please see attached draft regulation.

California State Auditor's Assessment of Annual Follow-Up Status: Not Fully Implemented

The Board of Pilot Commissioners' (board) draft regulations regarding the qualifications of board-appointed physicians include language which require the physicians to carry out their functions according to contracts with the board. However, as the board's response states, these regulations are not yet final and therefore the board has not yet contracted with physicians under these rules.

Annual Follow-Up Agency Response From September 2012

A 101-page study entitled, “Pilot Fitness Study for the Board of Pilot Commissioners for the Bays of San Francisco, San Pablo, and Suisun,” prepared by Dr. Robert Kosnik, MD of the University of California, San Francisco Medical Center, was delivered to the Board on May 26, 2011. The Board formally accepted the study on that day. The study provides 20 recommendations that, if adopted by the Board, will make substantial changes to Board procedures for pilot fitness determinations, including recommendations that would establish a two-physician fitness determination in a clinic setting. The Board also directed staff to initiate the preliminary stages by contracting with a consultant to prepare a market survey of costs and other matters necessary. The Board has also directed its Pilot Fitness Committee and Rules and Regulations Committee jointly to begin a series of public workshops that will address the full range of recommendations from the study. The first workshop was held on July 19, 2011. The Board plans to commence administrative rulemaking to facilitate establishment and implementation of a procedure for approving and monitoring Board-appointed physicians in November 2012, followed by a competitive procurement for Board physician services. An additional appropriation may be required in order for the Board to implement these changes.

California State Auditor's Assessment of Annual Follow-Up Status: Not Fully Implemented

Recommendation #3 To: Pilot Commissioners for the Bays of San Francisco, San Pablo and Suisun, Board of

To ensure that it consistently adheres to requirements in state law when licensing pilots, the board should follow its recently established procedure to complete a checklist to verify that trainees and pilots have fulfilled all the requirements for licensure, including the physical examination, before the board issues or renews a license.

1-Year Agency Response

The board has developed a pilot license renewal checklist and stated it has been used in all original and renewal license processes and preserved in the individual licensing files. (See 2011-406, p. 94)

California State Auditor's Assessment of 1-Year Status: Fully Implemented

Recommendation #4 To: Pilot Commissioners for the Bays of San Francisco, San Pablo and Suisun, Board of

To ensure that it fully complies with state law regarding investigations, the board should implement procedures to track the progress of investigations, including a procedure to identify those investigations that may exceed the 90-day deadline established in law.

1-Year Agency Response

The board stated that it has implemented a system of tracking the progress of open investigations by requiring a monthly report on the status of each open investigation and the expected reporting date and by tracking the expiration of the 90-day period in which investigation reports are to be presented, absent a timely extension for good cause. (See 2011-406, p. 96)

California State Auditor's Assessment of 1-Year Status: Fully Implemented

Recommendation #5 To: Pilot Commissioners for the Bays of San Francisco, San Pablo and Suisun, Board of

To ensure that it fully complies with state law regarding investigations, the board should ensure that there is proper justification and appraisal for investigations that require more than 90 days to complete.

1-Year Agency Response

The board reported that it will review any requests for an extension to determine the reason and whether the underlying cause for the request can be addressed to avoid unnecessary delays in the future. The reasons for the request for an extension will be recorded in the board’s minutes. (See 2011-406, p. 96)

California State Auditor's Assessment of 1-Year Status: Fully Implemented

Recommendation #6 To: Pilot Commissioners for the Bays of San Francisco, San Pablo and Suisun, Board of

To ensure that it fully complies with state law regarding investigations, the board should develop and enforce regulations establishing minimum qualifications for its investigators, as state law requires.

Annual Follow-Up Agency Response From December 2011

At its August 26, 2010, meeting, the Board adopted Commission Investigator minimum standard amendments to 7 CCR section 211.5 and they were filed with the Office of Administrative Law for final approval. They have since been approved as of March 17, 2011, and the changes went into effect April 16, 2011. A copy of the amended regulation is attached. (See 2011-041, p. 134)

California State Auditor's Assessment of Annual Follow-Up Status: Fully Implemented

Recommendation #7 To: Pilot Commissioners for the Bays of San Francisco, San Pablo and Suisun, Board of

To ensure that it fully complies with state law regarding investigations, the board should investigate reports of safety standard violations regarding pilot boarding equipment.

1-Year Agency Response

The board is investigating reports of safety standard violations it receives concerning pilot boarding equipment. (See 2011-406, p. 96)

California State Auditor's Assessment of 1-Year Status: Fully Implemented

Recommendation #8 To: Pilot Commissioners for the Bays of San Francisco, San Pablo and Suisun, Board of

To ensure that it is able to license the number of pilots it has determined it needs, the board should continue to monitor its need for additional trainees to replace those who retire.

1-Year Agency Response

The board stated that it has developed a comprehensive process for evaluating future pilotage needs and will continue to conduct regular retirement surveys of existing pilots. The board also stated that it conducted a trainee selection examination in June 2010 and that 12 applicants qualified for the board’s trainee training program. The board contracted with two applicants to begin the training program on January 1, 2011. (See 2011-406, p. 97)

California State Auditor's Assessment of 1-Year Status: Fully Implemented

Recommendation #9 To: Pilot Commissioners for the Bays of San Francisco, San Pablo and Suisun, Board of

To ensure that it has adequate controls to protect confidential information, the board should create a process, as state law requires, for accessing confidential information, such as board records containing confidential information on board members, board staff, or pilots.

1-Year Agency Response

The board developed a written protocol for access to confidential or restricted information in board records. (See 2011-406, p. 98)

California State Auditor's Assessment of 1-Year Status: Fully Implemented

Recommendation #10 To: Pilot Commissioners for the Bays of San Francisco, San Pablo and Suisun, Board of

To ensure that it has adequate controls to protect confidential information, the board should consistently use state-based e-mail accounts when conducting board business and, to the extent possible, import prior non-state e-mail into the state accounts.

1-Year Agency Response

As of November 2009, board members and staff are using state e-mail accounts. Specifically, after joining the Business, Transportation and Housing Agency, the board started a step-by-step technical infrastructure change. In that process, the board obtained state-based e-mail accounts for all board members and staff. (See 2011-406, p. 98)

California State Auditor's Assessment of 1-Year Status: Fully Implemented

Recommendation #11 To: Pilot Commissioners for the Bays of San Francisco, San Pablo and Suisun, Board of

To adhere to requirements regarding administrative practices, the board should establish a formal procedure to complete and maintain copies of required statements of economic interests.

1-Year Agency Response

The board developed a checklist to ensure that annual, as well as assuming and leaving office, statements of economic interest are filed and that copies are maintained in office files in accordance with the state’s political reform laws and the conflict-of-interest code provisions. (See 2011-406, p. 99)

California State Auditor's Assessment of 1-Year Status: Fully Implemented

Recommendation #12 To: Pilot Commissioners for the Bays of San Francisco, San Pablo and Suisun, Board of

To adhere to requirements regarding administrative practices, the board should institute a process of ensuring that investigators complete statements of economic interests and seek advice from the Fair Political Practices Commission when there are questions as to whether other consultants should file such statements.

1-Year Agency Response

The board requires investigators to file statements of economic interests and developed an ethics orientation program for those required to file such statements. (See 2011-406, p. 99)

California State Auditor's Assessment of 1-Year Status: Fully Implemented

Recommendation #13 To: Pilot Commissioners for the Bays of San Francisco, San Pablo and Suisun, Board of

To adhere to requirements regarding administrative practices, the board should develop procedures to ensure that board members and designated staff continue to receive required training, such as training in state ethics rules.

1-Year Agency Response

The board developed an ethics orientation program for those required to file statements of economic interests. (See 2011-406, p. 99)

California State Auditor's Assessment of 1-Year Status: Fully Implemented

Recommendation #14 To: Pilot Commissioners for the Bays of San Francisco, San Pablo and Suisun, Board of

To adhere to requirements regarding administrative practices, the board should establish processes to ensure that it posts accurate information about its meetings within the timelines required by law.

1-Year Agency Response

The board stated that it has implemented training of its staff in the update and maintenance of the board’s Web page displaying notices of its meetings. Further, the board stated it has provided direct access to update meeting information on its Web site. (See 2011-406, p. 99)

California State Auditor's Assessment of 1-Year Status: Fully Implemented

Recommendation #15 To: Pilot Commissioners for the Bays of San Francisco, San Pablo and Suisun, Board of

To adhere to requirements regarding administrative practices, the board should formalize a procedure for evaluating the executive director’s performance on an annual basis.

1-Year Agency Response

The board adopted a procedure to evaluate the executive director on an annual basis. (See 2011-406, p. 99)

California State Auditor's Assessment of 1-Year Status: Fully Implemented

Recommendation #16 To: Pilot Commissioners for the Bays of San Francisco, San Pablo and Suisun, Board of

To improve its record keeping, the board should establish formal procedures related to document retention in files regarding investigations. For example, the board should ensure that its investigation files contain a report of the Incident Review Committee’s opinions and recommendations and the board’s actions based on these recommendations.

1-Year Agency Response

The board stated that, beginning in October 2009, the Incident Review Committee reports contain all the data elements required by statute. (See 2011-406, p. 100)

California State Auditor's Assessment of 1-Year Status: Fully Implemented

Recommendation #17 To: Pilot Commissioners for the Bays of San Francisco, San Pablo and Suisun, Board of

To improve its record keeping, the board should determine and document what it needs to include in minutes of the board’s meetings, such as pilot renewals, and ensure that copies of license renewals are placed in the pilots’ files.

1-Year Agency Response

The board has put into service checklists for board meeting agendas and minutes of board meetings. The board stated it directed staff to compare draft agendas and meeting minutes with the checklists during document preparation. Finally, the board developed a pilot license renewal checklist. (See 2011-406, p. 100)

California State Auditor's Assessment of 1-Year Status: Fully Implemented

Recommendation #18 To: Pilot Commissioners for the Bays of San Francisco, San Pablo and Suisun, Board of

To ensure that it strengthens internal policies and controls over pilot rates and its finances, the board should review and approve any quarterly changes made to that portion of the pilot fee based on the mill rate.

1-Year Agency Response

The board stated it developed a process involving approval of mill rate changes involving a recommendation to the board by the Finance Committee and then formal board approval. The board processed the 2010 mill rate at its December 2009 meeting. (See 2011-406, p. 101)

California State Auditor's Assessment of 1-Year Status: Fully Implemented

Recommendation #19 To: Pilot Commissioners for the Bays of San Francisco, San Pablo and Suisun, Board of

To ensure that it strengthens internal policies and controls over pilot rates and its finances, the board should establish a requirement for an independent audit of the pilot boat and pilot pension surcharges and ensure that such audits are conducted each year.

1-Year Agency Response

The board has contracted with a certified public accounting firm to conduct a comprehensive audit of all surcharges for 2009, 2010, and 2011. (See 2011-406, p. 101)

California State Auditor's Assessment of 1-Year Status: Fully Implemented

Recommendation #20 To: Pilot Commissioners for the Bays of San Francisco, San Pablo and Suisun, Board of

To ensure that it strengthens internal policies and controls over pilot rates and its finances, the board should establish a monthly review of the revenue reports it receives from the Bar Pilots that includes verifying that the amount of the accompanying check is accurate and that the report is complete.

1-Year Agency Response

The board developed verification worksheets to compare San Francisco Bar Pilots’ monthly actual cash collections with remittances of surcharge moneys due to the board. (See 2011-406, p. 101)

California State Auditor's Assessment of 1-Year Status: Fully Implemented

Recommendation #21 To: Pilot Commissioners for the Bays of San Francisco, San Pablo and Suisun, Board of

To ensure that it strengthens internal policies and controls over pilot rates and its finances, the board should instruct the inland pilot to collect and remit the training surcharge and report these collections to the board.

1-Year Agency Response

The board demonstrated that it instructed the inland pilot to begin collecting and remitting the pilot trainee training surcharge and the inland pilot is doing so. The inland pilot has acknowledged the instruction and will commence collection of the surcharge beginning with his next trip. (See 2011-406, p. 101)

California State Auditor's Assessment of 1-Year Status: Fully Implemented

Recommendation #22 To: Pilot Commissioners for the Bays of San Francisco, San Pablo and Suisun, Board of

To ensure that it strengthens internal policies and controls over pilot rates and its finances, the board should develop procedures to separately track expenditures relevant to the operations, training, and continuing education surcharges.

1-Year Agency Response

The board reported that a new accounting system is in place. Representatives of the California Highway Patrol—who provide administrative services to the board—addressed the board in September 2010 and confirmed the new system was in place and would reliably track transactions involving the board’s operations, trainee training, and continuing education surcharges. (See 2011-406, p. 102)

California State Auditor's Assessment of 1-Year Status: Fully Implemented

Recommendation #23 To: Pilot Commissioners for the Bays of San Francisco, San Pablo and Suisun, Board of

To ensure that its expenditures are appropriate, the board should cancel its lease for two parking spaces that it entered into in 2009, or require its staff or board members to reimburse the board for their use of those parking spaces.

Annual Follow-Up Agency Response From December 2011

The Department of General Services discontinued its contract with the Port of San Francisco and entered into a lease agreement with a different landlord effective April 1, 2011. The Board moved the Board office to 660 Davis Street in April of 2011. A copy of the lease agreement is attached. (See 2011-041, p. 135)

California State Auditor's Assessment of Annual Follow-Up Status: Fully Implemented

Recommendation #24 To: Pilot Commissioners for the Bays of San Francisco, San Pablo and Suisun, Board of

To ensure that its expenditures are appropriate, the board should cease reimbursing pilots for business-class travel when they fly for training and amend its contract with the Bar Pilots accordingly.

Annual Follow-Up Agency Response From December 2011

On May 25, 2011, following review by the California Highway Patrol of the Board's proposed amendment, the Board and the San Francisco Bar Pilots amended their existing contract to specify that travel to Board-mandated training would be reimbursed at the rate of the most economical, refundable airfare. A copy of the amended contract is attached. (See 2011-041, p. 136)

California State Auditor's Assessment of Annual Follow-Up Status: Fully Implemented

Recommendation #25 To: Pilot Commissioners for the Bays of San Francisco, San Pablo and Suisun, Board of

To ensure that all pilots complete required training within the specified time frames, the board should schedule pilots for training within the period specified in state law and board regulations.

1-Year Agency Response

The board implemented a checklist to track each pilots training cycle and the expiration dates for the three-year and five-year training periods to ensure timely attendance at board-mandated training. The board told us that it directed staff to begin the formal rulemaking process to amend regulations to require all pilots to complete both combination and manned-model training courses once in every five years. The proposed amendments are awaiting public comments. Further, the board states it initiated a contract amendment to include the requirement that pilots receiving manned-model training are evaluated upon completion of the training and that the completed evaluation be forwarded to the board for review. The amended contract is under review by the Department of General Services. The board expects to complete these activities by December 31, 2010. (See 2011-406, p. 97)

California State Auditor's Assessment of 1-Year Status: Fully Implemented

Subsequent to the original publication of this response, the state auditor considered this recommendation to be fully implemented.

Recommendation #26 To: Pilot Commissioners for the Bays of San Francisco, San Pablo and Suisun, Board of

To ensure that all pilots complete required training within the specified time frames, the board should include in its contracts with institutions providing continuing education for pilots, a provision requiring those institutions to prepare an evaluation of pilots’ performance in the training.

Annual Follow-Up Agency Response From December 2011

The Board has initiated a contract amendment to include the requirement that pilots receiving manned model training should be evaluated upon completion of the training and that the completed evaluation be forwarded to the Board for review. The Department of General Services approved an amended contract with the vendor providing manned model training January 31, 2011. The amendment took effect January 31, 2011. A copy of the amended contract is attached. (See 2011-041, p. 135)

California State Auditor's Assessment of Annual Follow-Up Status: Fully Implemented

Recommendation #27 To: Pilot Commissioners for the Bays of San Francisco, San Pablo and Suisun, Board of

To ensure that it consistently adheres to requirements in state law when licensing pilots, the board should review and update its regulations regarding the frequency of pilot physical examinations to ensure that they are consistent with state law.

Annual Follow-Up Agency Response From December 2011

The Board’s Rules and Regulations Committee commenced the process of updating the Board’s regulations with respect to frequency of pilot physical examinations at its June 2010 meeting. The Office of Administrative Law approved the regulatory amendments to 7 CCR sections 217 on March 14, 2011. The changes went into effect on April 13, 2011. A copy of the amended regulation is attached. (See 2011-041, p. 134)

California State Auditor's Assessment of Annual Follow-Up Status: Fully Implemented

All Recommendations in 2009-043

Agency responses received after June 2013 are posted verbatim.