Who Will Control the Cash?

Talk to most county residents and they might be hard-pressed to tell what the Santa Barbara County treasurer-tax collector actually does.

Homeowners would probably be able to explain they write out their checks for property tax payments to the tax collector (currently Bernice James, who is retiring), but beyond that, the office is a mystery to many. That’s why the election for the position might be a surprise to most voters when they open their vote-by-mail ballots next week, or head to the polls June 8.

Three candidates are in the race to replace Bernice James — her top assistant Harry Hagen, financial consultant Gregory Gandrud from Carpinteria, and Michael Cheng from Santa Barbara.

Hearing two of the three candidates talk at a recent, sparsely attended community forum, it’s clear that Hagen’s experience puts him in the driver’s seat and it is his race to lose. As a 14-year veteran of the office, the last seven as the assistant treasurer-tax collector, he is intimately involved in the day-to-day work of the office and has a keen understanding of what the job entails. He’s endorsed by all five supervisors, Auditor-Controller Bob Geis, his boss, current Treasurer-Tax Collector James, and her predecessor Gary Feramisco.

Gandrud focused on his experience on the Carpinteria City Council, speaking more generally about issues with the county coffers. He wants to use the office to reform the county’s pension system, safeguard the county’s tax money, and make sure it is spent wisely. He said he is running “because I’m so very concerned about the financial situation of the county.”

But the treasurer-tax collector is limited by the county and state code in what he or she can and can’t do and has no control over the actual spending of the county budget. The treasurer and tax collector part of the job essentially acts as a bank for the public’s money, at any one time controlling about $900 million, collecting and processing payments, investing revenue, and administering bond debts. The public administrator side of things takes over estates for individuals who have passed away with no family or friends. “To administer these functions effectively, you have to know what they do,” said Hagen, a CPA. “I understand the inner workings of the office.”

The third candidate, Cheng, was absent from the forum last month. Not much is known about the third candidate, who couldn’t be reached for comment. He is running a low-key campaign, not raising money, nor attending debates, and he even declined to submit a candidate statement for the ballot.

Hagen, a 45-year resident of the county and 14-year veteran of the county treasurer-tax collector office, said keeping the county’s credit rating high is a main concern, and, despite the fiscal mess (the county is looking at a roughly $40-million deficit next year), it maintains a credit rating of AA+, and a Treasurer’s Investment Pool rating of AAA. He plans to manage the public money properly and safely invest the county’s money where it can. He noted that had the office not been doing so, the county would’ve lost money in even bigger numbers. “We want to make a market return, but not at the expense of the safety of the county funds,” he said. He has been at the forefront of addressing elder abuse and plans to be vigilant in collecting payments the county is owed should he be elected tax collector.

But Gandrud, who is currently the chair of the county Republican Party, said times are changing and fresh faces are needed. “We can’t just keep doing things the way they are,” he said. Gandrud has the endorsement of State Senator Tony Strickland, City Councilmember Frank Hotchkiss, and Assemblymember Sam Blakeslee. He cites his 19 years in public accounting, and his 10 years as an elected official “fighting waste and fraud in government” as his experience relevant to the position. He wants to use technology more by offering electronic ways to pay and thinks the treasurer should be a financial resource for the entire county.