Widespread nepotism cited at tax agency

At the state’s Board of Equalization, 17.5% of workers are related by blood or domestic relationships.

SACRAMENTO — California’s tax collection agency is plagued by widespread nepotism, with 835 employees, or 17.5% of the office’s workforce, related by blood, adoption, marriage or cohabitation, according to a state investigation released Wednesday.

The probe by the state Personnel Board found that before its recent reorganization, the state Board of Equalization had 4,767 employees and several were related and working in the same departments or divi- sions.

“There was no process for identifying and tracking employees who were related to each other by blood, adoption, marriage, and/ or cohabitation,” personnel officials concluded.

It found the Board of Equalization’s anti- nepotism policy did not meet state standards and some job applicants were “preselected for civil service appointments in violation of the civil service rules.”

Allegations from anonymous employees triggered the probe as well as a decision by the Legislature and governor in June to break up the agency, transferring most of the employees from the Board of Equalization to a new California Department of Tax and Fee Administration. The state attorney general is also investigating issues involving transferring of employees to do work to help elected Board of Equalization members.

The investigation released Wednesday is based on a survey of employees, leaving open the possibility for underreporting, so the numbers may be higher.

Nicolas Maduros, who was later hired as director of the new agency, recently announced new, tougher rules to prevent nepotism, including a ban on employees seeking to exert any inf luence on the hiring and promotion of workers.

“We need to ensure that all of our personnel decisions are based solely on merit,” Maduros said.

Employees complained to investigators that there was favoritism toward relatives in hiring and promotion decisions.

Board member Fiona Ma asked for the review.

“This investigation demonstrates the mismanagement, f lagrant nepotism, and abuse of authority I discovered upon my election and have spent my tenure on the board trying to uproot,” she said.

The report recommends that three people hired under questionable circumstances have their hiring voided because the board failed to follow proper procedure.

In one case a tax consultant “used his position of inf luence to encourage the hiring of his son,” the investigation said. The tax consultant worked in the office of board member George Runner. Investigators said the hiring was “the result of pre- selection and hence unlawful.”

The investigation also found that board member Jerome Horton called someone in charge of hiring to recommend a woman for a job as a program analyst. Horton’s chief of staff also recommended her, and the hiring official knew the woman was the daughter of a state Assembly member.

The woman was hired even though her application was turned in after a deadline, and she was chosen over another applicant interviewed in a process with no rating criteria.

Investigators said the hiring “was unlawful and made in bad faith.”

Horton denied that he and his chief aide recommended her for a job.

“We simply notified the agency of our concerns of discrimination and inequity in the process and were not privy to the selection criteria/ process or test results and learned of the hire after the fact,” he said.

The investigative report included examples where nepotism created conflicts in the agency.

In one case, the board’s Administration Department employed two program analysts, a father and daughter, who reported to the same supervisor.

The External Affairs Department has two software specialists who are cousins related by marriage who report to the same administrator.

The investigators also recommended that four recent personnel decisions be voided because they failed to follow proper procedures.