State Audit of Mendocino County Finds Strained Finances and Fraying Systems

Auditors found District Attorney's steakhouse dinner to be a prohibited gift of public funds

Mendocino County is known for its natural beauty and gaps in county government controls. (Photo courtesy of Thomas Hawk via Flickr)

Typo fixed (December 18, 2025, 6:11 p.m.)

For years, Mendocino County’s financial troubles surfaced in fragments: late reports, concerns about property tax collection expressed at public meetings, a costly and ongoing court battle over the use of asset forfeiture funds, and a 2024 primary election marred by ballot errors. This week, a sweeping state audit brought all those fragments together into a single, unsettling picture.

In a 97-page report released this morning, the California State Auditor concluded that Mendocino County’s financial condition is “gradually declining” and that key administrative systems — from accounting and procurement to elections oversight — are vulnerable to “waste, error fraud and abuse”. Without corrective action, the report warned, those weaknesses are likely to persist.

The audit was ordered by the Legislature and the governor after a convergence of red flags: delayed financial statements, public confusion among county supervisors about the county’s overall fiscal health, ballot mistakes during the 2024 presidential primary, and a criminal indictment — later dismissed — of the elected auditor-controller–treasurer-tax collector.

At the center of the report is a long-term imbalance. From fiscal year 2019–20 through 2023–24, county expenditures rose more than 30 percent while tax revenues stagnated. During that same period, the county’s general fund reserve fell slightly below the minimum level recommended by the Government Finance Officers Association — a threshold meant to cushion governments against emergencies and economic shocks.

Property taxes, one of the county’s largest revenue sources, played a significant role. Auditors found that problems with Mendocino’s property tax system contributed to delayed assessments and growing unpaid balances. As of the audit period, the county had $30.6 million in unpaid property taxes, interest, penalties and fees — more than half of it tied to the three most recent tax years.

The county’s tax collection rate has also slipped. While Mendocino once collected nearly 98 percent of property taxes within the year they were billed, that figure dropped to just over 94 percent by 2023–24. Auditors said the trend points to increasing delays, even as county officials attributed the figures to backlogged bills, staffing shortages and disruptions caused by software upgrades.

Financial reporting delays compounded the problem. The Auditor-Controller–Treasurer-Tax Collector’s Office, responsible for producing the county’s Annual Comprehensive Financial Report, missed recommended deadlines in multiple recent years. Those delays, auditors said, limit the ability of supervisors — and the public — to understand the county’s true financial position in real time.

The report also flagged weaknesses in procurement and contracting practices. Nearly half of the 30 expenditures reviewed lacked sufficient documentation or justification, according to auditors.

“We noted that county departments did not consistently obtain required approvals for purchases, such as purchases from online retailers, or document the reasons for purchases, such as for a television, making it unclear if they were made for justifiable reasons,” the report stated.

Some expenditures violated constitutional prohibitions on gifts of public funds, including payments connected to religiously affiliated organizations. Others reflected weak oversight, such as poorly justified sole-source contracts and agreements split across fiscal years to avoid approval thresholds.

The state auditor singled out a $3,600 end-of-year staff gathering at a steakhouse hosted by the Mendocino County District Attorney’s Office as an example of a prohibited “gift of public funds.” The dinner was paid for using asset forfeiture funds.

“The office paid based on the number of individuals in attendance, and its records indicate — and the District Attorney’s Office acknowledges — that attendees included both its office’s staff and their guests,” the report noted. The District Attorney’s Office shared its perspective that including spouses and significant others at the event fostered a more inclusive and positive work environment. It also stated that the county’s chief executive officer had preapproved the expenditure, although auditors said they saw no independent evidence of that approval.

The auditors warned that current practices leave the county exposed to waste, fraud and abuse, even in the absence of proven misconduct.

Election administration was another area of concern. While the county’s Elections Office was not responsible for a vendor error that sent incorrect ballots to most voters in the 2024 primary, auditors found that the office itself assigned some voters to the wrong precincts — leading to a second round of incorrect ballots. More troubling, the report said, was that those assignment errors had not been fully corrected by the time of the audit, raising the risk of repeat mistakes.

Mendocino County officials offered varied responses to the report. The Board of Supervisors and the county’s chief executive officer generally agreed with the findings, while responses from independently elected officials were more mixed.

County Assessor/Clerk-Recorder Katrina Bartolomie said her office is working with the county’s Information Technology Division and evaluating tools used by other counties to create an “aging” or “workflow” report by March 2026. The tool would help staff sort properties by change-of-ownership dates or permit issuance dates, improving workload management and identifying properties at risk of lost property tax revenue.

Registrar of Voters Katrina Bartolomie said the Elections Office agreed that a contract with its ballot printer would be beneficial. A contract with a ballot-printing vendor is currently being processed and is expected to include performance standards and remedies for errors.

Auditor-Controller–Treasurer-Tax Collector Chamise Cubbison said she largely agreed with the draft report sections provided to her and accepted the recommendations directed to her office. Those include continuing efforts to hold regular default tax property auctions by October 2026; revising timelines for completing policies and procedures related to key responsibilities such as bank reconciliations and journal entries by March 2026; and working with the CEO’s office to make greater use of the county’s accounting system by September 2026, including increased automation.

District Attorney David Eyster disagreed with the auditor’s conclusions about his office’s operations and submitted a lengthy response defending its use of asset forfeiture funds.

Mendocino County Sheriff Matt Kendall agreed with the report’s conclusions and said his office removed donations from its list of allowable asset forfeiture expenditures in mid-2024 in response to changes in U.S. Department of Justice guidelines. Auditors, however, noted that the Sheriff’s Office made a donation using asset forfeiture funds in November 2024.

The California State Auditor’s Office said it expects to receive updates on specific recommendations as part of its formal follow-up process.