OC Grand Jury questions supervisors' $2.5M discretionary funds amid budget crisis

The Orange County Grand Jury released a report Wednesday questioning why the county's five supervisors each receive $2.5 million in annual discretionary funds and have expanded their personal political staffs, even as the county draws on $75 million in one-time reserves to close a budget shortfall, according to Voice of OC.

The report arrives a day after supervisors voted in a preliminary poll to return $3.7 million recovered from former Supervisor Andrew Do's corruption case into a colleague's district account — a move that intensifies scrutiny of how public funds are allocated across Orange County's five supervisorial districts.

The Grand Jury's report, titled "Growing Political Appointees and Discretionary Spending within the OC Board of Supervisors," found that board-level spending and staffing have grown without clear justification, according to Voice of OC. "Board-designated discretionary spending has continued to grow without clear alignment to countywide and citywide priorities," the Grand Jury said.

The findings landed the same week County CEO Michelle Aguirre told the board at Tuesday's public meeting that fiscal options had run dry. "Simply put, we have exhausted all resources available to us," Aguirre said. "You will see that we have no general fund requests for additional resources, because there are none to be given." The county pulled $75 million from one-time reserves to balance its budget as spending has outpaced revenue, Voice of OC reported.

The timing sharpened the contrast: one day before the Grand Jury report's release, supervisors held a straw vote to redirect $3.7 million — funds recovered from former Supervisor Andrew Do's corruption case — into Supervisor Janet Nguyen's First District budget, bringing the total discretionary allocation to her district to nearly $4 million. Do pleaded guilty to accepting bribes and using county discretionary accounts to funnel more than $10 million to nonprofits, including one that employed his daughter. Outside legal and forensic audit costs from the Do scandal have reached $1.7 million, according to Voice of OC. "These funds were recovered in connection with the Andrew Do corruption matter, and it should be returned back to the benefit of the First District community that were deprived of the intended services," Nguyen said at Tuesday's meeting.

Not every supervisor agreed with the approach. Supervisor Vicente Sarmiento said residents harmed by Do's diversion deserve restitution, but the mechanics warrant more scrutiny. "Those funds, when they were diverted, they hurt and created true victims of residents who were denied the services, the assistance, the opportunities to recover quickly," Sarmiento said. "I do believe that the money should go back to those that were harmed, but let's figure out who was harmed."

The Grand Jury found supervisors are increasingly bypassing county department experts in favor of their own political appointees — a trend the report said drives up administrative costs without operational rationale. It contrasted current expansion with the county's 1994 bankruptcy response, when board-appointed staff was cut from eight positions to six. "Without reform, administrative costs are likely to rise due to internal political considerations rather than operational necessity," the Grand Jury said.

The panel recommended the board limit discretionary grants to county-related purposes and adopt uniform eligibility and reporting standards "to ensure transparency and eliminate the appearance of political favoritism," according to the Voice of OC report. The jury also noted that only 4 percent of Orange County residents live in unincorporated areas directly governed by the board, raising questions about why discretionary spending routinely flows to organizations outside that governance scope. Supervisors voted themselves a 25 percent pay increase last year, pushing their salaries above California's governor, according to earlier Voice of OC reporting.

The Grand Jury noted there are currently no public plans to make supervisor discretionary funds a permanent, ongoing program, leaving the board's spending practices without a defined long-term accountability framework.