Humboldt County Auditor-Controller Karen Paz Dominguez. | Screenshot from a September meeting.


The main event at Tuesday’s remarkable meeting of the Humboldt County Board of Supervisors resembled a desperate intervention of sorts — or perhaps a criminal tribunal — as department heads, fiscal staff and supervisors took turns lambasting embattled Auditor-Controller Karen Paz Dominguez for being uncommunicative, vindictive and woefully behind in her office’s responsibilities. 

Tensions have been steadily building over the past couple of years around a variety of fiscal management issues, including overdue fiscal reporting, poor inter-departmental communication and various other matters. Lately the primary concern has been management of the county’s payroll function.

When Paz Dominguez assumed office at the beginning of 2019, payroll was managed by a more or less separate division within her office. Later it was moved into the Human Resources Department, then outsourced to an independent company, then moved back under HR before finally being moved back under the Auditor-Controller’s Office a couple of months ago, despite serious concerns voiced by some staff members

Meanwhile, Paz Dominguez has sparred with staff in the County Administrative Office, the Department of Health and Human Services and other departments while department heads complained that late fiscal reporting from her office was costing the county hundreds of thousands of dollars in state and federal reimbursements — allegations that she has repeatedly disputed.

Paz Dominguez has consistently held herself up as a reformer looking to overhaul the county’s fiscal management, which she characterizes as sloppy and vulnerable to manipulation and fraud. But staffers, department heads, supervisors and outside contractors have voiced increasing alarm over fiscal delays and other issues tied to her office, including an inability to get her to respond to emails and phone messages.

On Friday we reported that matters appear to be coming to a head. The Workforce Development Board is pursuing a vote of “no confidence” in Paz Dominguez and a letter submitted to the Board of Supervisors by anonymous county staffers threatens legal action or other measures in response to the “failures” of Paz Dominguez.

Well, today matters did indeed come to a head. Nominally, the item under discussion was a status report on the transition of payroll duties back to the Auditor-Controller’s Office. (It was on the consent calendar, but Second District Supervisor Michelle Bushnell pulled it for discussion.)

Paz Dominguez delivered a lengthy PowerPoint presentation on the matter — with occasional grilling from supervisors Bushnell and Rex Bohn, in particular. The exhibition was intricately detailed with graphs and graphics and included with a list of challenges hampering progress.

That list culminated with an allegation that her office has seen only “limited” support from county supervisors, department heads, deputy directors and managers, which is affecting employee morale. 

“And so I’m willing to put myself here on the stage and take ownership of my part in this challenge that we have,” she said. “I understand that my communication style may be different than what some people are used to.” But public griping — in the press and in meetings — has left employees feeling discouraged, she added.

Before she’d even completed her presentation, the floodgates opened. A couple of supervisors bristled at this characterization, and shortly thereafter dozens of employees called in and proceeded to unleash a litany of grievances.

Fourth District Supervisor and Board Chair Virginia Bass said she’s heard from employees who say they can’t even get a meeting with the Auditor-Controller. 

“Even today, you said you were too busy to be here,” Bass said.

Bushnell said she’s also had trouble communicating with Paz Dominguez. “In the past, I’ve emailed you questions. … I don’t know you, Karen. I’ve never even met you yet because of this pandemic. [But] I have emailed you questions and you shot back to me that I was being retaliatory. I’m not retaliatory. I’m trying to do my job the same as everybody else.”

She said someone called her last week to report that she hadn’t gotten her child support payment. This person was “bawling on the phone because she could not buy groceries,” Bushnell said. “I can’t get an answer for them. … What am I supposed to tell them? They also tried to call your office. They tried other pathways before they reached out to me. … And I understand that you say you don’t have time. But what am I supposed to tell my constituents when something like that happens? What am I supposed to tell other staff when they call me and say they didn’t get their paycheck or they got paid for two hours and they can’t get ahold of anybody?”

Paz Dominguez replied, “I can only take responsibility over what I can control and ownership over my actions,” adding that the issues Bushnell had raised were too complex to address in one small conversation. “I will say that it’s a team effort in this challenge. Everyone has had a part to play in the dysfunction, quite frankly, that we are facing right now.”

Complicating matters further is the fact that Human Resources Director Linda Le, who’d been working with Paz Dominguez on the payroll transition, submitted her letter of resignation last month. The Outpost learned that she’s departing for health reasons. Her last day will be November 19, and the county has hired an interim HR director, Dar Rhodes, to replace Le in the short term.

Back to those opened floodgates. Below is a sampling of quotes from county staff who called in on Tuesday.

Department of Health and Human Services (DHHS) Director Connie Beck:

Financially, we receive little to no information from the Auditor-Controller’s Office. An example of this is that staff have been provided timelines and due dates for the close of fiscal year 20/21 four times with no follow-up information. Staff ask questions; they don’t get any answers. …

Due to the state of our finances, I’m leery about trying to provide additional services because our fund balance — or lack of — will continue to grow. As an administrator of over 100 programs and 200-plus contract providers, I’m really struggling with when to [notify] the committee that we will need to scale back our services due to the uncertainty of our reimbursement.

DHHS Deputy Director of Finance Trevis Green:

DHHS is extremely concerned that the way things are going, the department will lose the ability to claim even more reimbursements, see more allocations cut and suffer through even more cash flow issues as we move forward.

Green mentioned a quote Paz Dominguez provided to the Outpost last week, in which she alleged that departmental claims of lost reimbursements were false, the result of individual departments “choosing” not to claim expenses. Green begged to differ:

I find these comments extremely insulting. For somebody to try to blame-shift these problems onto the departments is unacceptable, and my team and I stand ready to prove the losses that we are suffering from the choices that are being made in the way the business practices are being rolled out through the [Auditor-Controller’s Office].

Deputy Director of Sheriff’s Administration Regina Fuller, one of 11 employees who signed this Aug. 23 letter to the Board of Supervisors articulating concerns about moving payroll back the the Auditor-Controller’s Office:

We were very concerned that with this transition the Auditor would be focusing all of her time on payroll and that the financial situation would fall even further behind. And I can tell you from my experience … that is the case. The financial situation is behind … . 

The breakdown of communication is my biggest concern, absolutely. Departments are being shut out or not being communicated [with], both for this payroll transition and for our financial situation.

Planning and Building Director John Ford:

I was a little concerned when the comment was made that a lot of the morale problems are due to negative comments by department heads. I am a department head and I can assure you, I do not make negative comments. We work very hard to collaborate and coordinate with Auditor-Controller’s Office. And I frankly took offense at that. That’s not a good way to solve problems.

Ford recounted a story about an employee whose paycheck was sent to the wrong address, causing a bureaucratic confusion that took a while to clear up. 

And in the process, he was treated like he was trying to cheat the system. And he was furious. … And he was encouraged not to respond [to the Auditor-Controller’s Office], not to send any letters [or] emails. … And when we can’t get into the [Auditor-Controller’s Office], when we can’t talk to people [to] work things out verbally … it makes it very, very difficult to problem-solve.

Economic Development Director Scott Adair:

I happen to be calling in today from a hotel room in Monterey where I’m presently working and meeting with representatives from the Governor’s Office of Economic Development, as well as other economic development practitioners, at a statewide event … During the morning session, after introducing myself to a fellow participant, I was met with the reply, “Oh, Humboldt County. I hear you guys are a hot mess up there.” …

Everyone here knows that calls have been placed by staff and other officials to elected representatives at the state level to try to resolve the conflict here. … Our agency is under advisement from the state that several of our state and federal WIOA [Workforce Innovation and Opportunity Act] programs are at risk of being frozen or cash being put on hold or revenues being put under de-obligation, where our community would have to pay back grant money, because our single audit remains incomplete. …

I understand that other agencies also have funds and programs at risk because the single audit and other year-end closing activities remain incomplete. I am concerned that when there are millions of public dollars at risk and critical programs on the line, and the Auditor-Controller herself has stated that her office is short staffed and overwhelmed — and that she’s unable to make critical meetings — why did we as an organization assign to that agency more scope and further responsibility? 

The failure to complete essential and fundamental functions puts our entire county and its populace at risk. And I don’t know the answer here. But I think that staff are looking to the board for that answer. Because you’re our leadership. …

When our tools and resources are at risk, I believe it is our moral, fiduciary responsibility to ring the bell and raise the flag and warn you that something needs to be done. … Something is broken. I think that’s apparent. Something is broken.

Others to chime in included Treasurer-Tax Collector John Bartholomew, Chief Probation Officer Shaun Brenneman, North Coast Regional Child Support Services Director Bennett Hoffman and Public Works Director Tom Mattson, all of whom voiced concerns about communication problems, payroll issues and year-end audits.

Given an opportunity to respond, Paz Dominguez said she has only had the benefit of one payroll specialist to help her, and she insisted that she has been responding to inquiries. 

“I don’t agree with characterizations that have been expressed here today,” she said. “But it could it could be something as simple as, I see a six, you see a nine. Which one is correct?”

She reiterated difficulties due to short-staffing, a high volume of demands and challenges caused by the pandemic.

“What I’m hearing here — you know, if I put the personal away and I just look at professional — what I see is just frustration, because everyone is frustrated,” Paz Dominguez said. “Everyone is overworked. Everyone is stressed out.”

Trying to center all of the dysfunction on one person does a disservice to the public, she argued, sounding emotional. She said that by the time her office was asked to take over the payroll function, the county had reached crisis mode. 

“At this point, I’m hearing what everyone is saying, that they want to be involved,” she said. “They want to have meetings. They they don’t like my emails. I don’t send them enough. … Everyone got their opportunity to let it out. Now we just need to move forward.”

She said everyone should probably take a deep breath and accept that this is where we are, adding that she’s committed to moving forward.

But the complaints about her performance weren’t over. Bass opened the public comment period, and the onslaught of criticism continued. Humboldt County Planning Commissioner Thomas Mulder said, “You know what? If you are not capable of doing the job, walk away. Walk away.”

A procession of fiscal employees from DHHS called in. Jessica Bradbury-Maciel, a budget specialist for that department, said, “It is incredibly soul-crushing for staff in Public Health — [who] are still very deep in the COVID response, often doing several jobs — to continually hear the Auditor-Controller’s Office blame their mismanagement and shortfalls on the pandemic and staffing shortages. We are still held to all of their deadlines and meet those despite the additional workload of the pandemic.”

Katherine Lourenzo, the county’s payroll manager, who is currently on stress leave due, she says, to “the toxic workplace” Paz Dominguez created, said, “Today’s presentation made it very clear to me that the elected Auditor-Controller does not have the ability to manage the responsibility of the payroll function.”

Katie Collender, a former senior administrative analyst in the Sheriff’s Office, said she was a dedicated county employee and still would be “if not for the toxic environment created by the Auditor-Controller.” She has yet to receive her final paycheck, despite turning in the paperwork on time, she said. She was among the signatories to the Aug. 23 letter urging the county not to move payroll back under the Auditor-Controller’s Office. “I have to wonder if the auditor is not issuing my final check as a form of retaliation,” Collender said.

Several other county employees spoke, with only one, Senior Accountant-Auditor Jim Hussey, who works in Paz Dominguez’s department, speaking in defense of the auditor-controller.

All told, this collective condemnation stretched on for close to four hours. Bushnell observed that the whole conversation had been difficult. “I’m sure it was not fun for anyone participating or listening,” she said. She wound up making a motion that will require more accountability from Paz Dominguez to the board.

Specifically, she asked staff to move the regular payroll update report from the consent calendar — where items are often approved without discussion — to the departmental reports section, where a “personal discussion” can take place. Her motion also asked the County Administrative Office to come up with “metrics and comparables” that will allow the board to assess whether payroll and other functions of the Auditor-Controller’s Office are moving forward.

The motion passed unanimously.