Although Cupertino and Los Altos Hills renewed more expensive public safety contracts with the Santa Clara County Sheriff’s Office, the mayors of both negotiated the possibility of recovering costs associated with excessive overhead that they believe are improper.
Saratoga, Cupertino and Los Altos Hills have historically contracted their law enforcement and public safety services out to the county. Both Cupertino and Los Altos Hills did not have a policing alternative to contracting with the sheriff’s department, so they signed the contract at a higher cost. Los Altos Hills Mayor Rajiv Bhateja said the town renewed its contract with the sheriff’s office during a special meeting on Aug. 31 for almost $3.4 million for this fiscal year. The town used to pay $2.8 million a year. Cupertino Mayor Kitty Moore said the council approved renewing the sheriff’s contract on Sept. 15 for a total of $25.4 million for this fiscal year. The city’s former contract cost $19 million yearly. Both mayors confirmed that they added language that preserved their ability to challenge costs under California Government Code 51350, which states that counties are required to charge costs incurred in providing contracted services but cannot pass on certain countywide and general government overhead charges to contract cities.
Saratoga renewed its public safety contract with the sheriff’s office on Aug. 19 for $10.8 million. Saratoga previously paid $9 million for these services, leading city staff to warn the council of a “dire fiscal situation” if they continued to contract with the sheriff’s office. The Los Gatos-Monte Sereno Police Department offered to provide law enforcement services in Saratoga for around $9.7 million, despite residents’ complaints about costs and privacy concerns related to automatic license plate reader usage.
According to Bhateja, the cost recovery section of Los Altos Hills’ contract with the sheriff’s office allows the cities to challenge the costs, but it does not establish that the cities were overcharged or guarantee repayment. Moore confirmed that similar language was included in Cupertino’s contract to ensure that the appropriate costs were passed onto the city.
Bhateja confirmed that the purpose of adding this language was to allow the contract cities to be able to recover costs associated with excessive overhead, but it requires the county to agree to it. Earlier this year, the three mayors consulted an auditor from Vasquez and Associates, LLP, to determine options for reducing or adjusting the costs associated with the sheriff’s contract. An Aug. 27 report from the consultants found that a total of $10.7 million in overhead fees should not be passed onto the three contract cities.
“We’re not opposed to the cost for the deputies and supervision,” Bhateja said in an interview with the Bay Area News Group. “What we aren’t okay with is the overhead.”
However, the county asserted in a letter to the City of Cupertino that there were major foundation issues in the report. County officials took issue with the way the consultants categorized direct and indirect costs, compared their cost allocation methodology to other jurisdictions and based their findings on incorrect staffing numbers.
“We do not believe there is any legitimate basis for the cities to challenge contracts that they have just agreed to enter into with the county,” stated a Santa Clara County representative in an email to this news organization.
Los Altos Hills’ contract was approved by the county board of supervisors on Sept. 15. Bhateja said the town council asked the town manager to enter into informal negotiations and possibly mediation to continue to investigate excessive overhead costs without drawing the town into litigation.
The three West Valley cities were initially given a Sept. 1 deadline to sign the sheriff’s contract to ensure that the county board of supervisors could ratify the agreements before policing services lapsed Oct. 1. Moore said she confirmed with county sheriff Robert Jonsen that sheriff’s deputies would still cover the city from Oct. 1-6. The board of supervisors approved Cupertino’s contract on Oct. 6.