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After reporting $200 million of public funds missing, she was terminated

After reporting $200 million of public funds missing, she was terminated

Former California Public Utilities Commission Executive Director Alice Stebbins flagged $200 million of missing funds earmarked for the state's blind, deaf, and poor.

Alice Stebbins was the Executive Director at the California Public Utilities Commission (CPUC). She recently spotted that $200 million, earmarked for the state's blind, deaf, and poor was missing from the CPUC's accounts. When she reported the missing funds, she was terminated from her job. Stebbins had allegedly "called into question her integrity" by hiring former colleagues without proper qualifications, violating state personnel rules. After she was fired, an investigation conducted by the Bay City News Foundation and ProPublica discovered that Stebbins was, in fact, correct. They also found several irregularities in the State Personnel Board report that Commission President Marybel Batjer used to terminate her, ProPublica reports.

 



 

 

Batjer informed Stebbins, "You took a series of actions over the course of several years that calls into question your integrity. [Those actions] cause us to have to consider whether you can continue to serve as the leader of this agency." Five commissioners agreed in a unanimous vote to fire her. However, just days before her dismissal, CPUC officials told California’s Department of Finance that the agency was owed more than $200 million. The agency thus launched an investigation into the missing funds. In addition to this, three former CPUC employees claimed the report of Stebbins's questionable actions included falsehoods.

 



 

 

Stebbins had hired the auditor who discovered the missing money. Though the report claimed that the auditor was unqualified, hiring records show that state officials had concluded that he was the most qualified candidate. He was awarded an “excellent” rating in every single category. Meanwhile, California Governor Gavin Newsom appointed Batjer, a former casino executive, to lead the commission in July 2019. This was the same month Stebbins, then-Executive Director, briefed the commissioners on issues with the agency’s accounting processes. Batjer surveyed her hiring decisions early on and soon after she was sworn in as President, texted Julie Lee, California’s acting secretary of Government Operations (GovOps) that she was “very concerned.” They then exchanged text messages about firing Stebbins. This exchange was in and of itself a violation of state transparency laws, as the majority of a public body is prohibited from "discussing matters under its jurisdiction outside of a regular meeting, particularly to build a consensus."

 



 

 

Due to the circumstances of her dismissal, Stebbins, who has served as an auditor and budget analyst for different state agencies for over 30 years, filed a wrongful termination lawsuit against the CPUC earlier this month. In several interviews, she highlighted the problems plaguing the commission, describing "an agency mired in disorganization and ineptitude." She explained, "You’ve got just systemic issues. The only way you can make those changes is to really tear it apart." Regarding the report on her hiring decisions, she said, "I had some fairly passionate discussions with commissioners. I honestly could not in any way convince them that the report was incorrect, none of them would listen to me. It was weird because I had a good relationship with the commissioners and all of a sudden I didn’t."

 



 

 

Now, for the first time in three decades, Stebbins is out of government work. She currently spends her days prepping for the lawsuit, though her goals remain the same: "effecting change in the agency and uncovering the depth of its fiscal morass." "A couple people warned me, they said, ‘Be careful, this isn’t going to be favored, people aren’t going to like you, because you’re doing things nobody’s ever done,'" she shared. "When I finally was terminated, one of my team said to me, ‘You’re the first person who came in here, you effectuated change, you made stuff happen, you were cleaning up the organization and they fired you.’"

 



 

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