State: License Plate Money Meant for Kids Mismanaged

About 40 percent of the funds went to administrative costs, in violation of California law.


The money from state license plates with hearts, hands and star symbols has been misspent, according to a report released Tuesday by the California State Auditor.

State departments broke the law by hiring private contractors to manage the program, according to the audit. Between fiscal years 2006-2007 and 2009-2010, about 40 percent of the money was used to pay administrative costs to private contractors, the audit says. That's nearly $2.1 million.

The Kids Plates program was approved in 1992. For a fee, drivers could order a custom license plate with a hand, heart, star or plus sign symbol. Half of the money was to be spent on prevention of child abuse and unintentional childhood injury.

The money from the plates was administered through the Department of Public Health. But when the department hired the private San Diego State University Research Foundation to manage the program between 2004 and 2010, it broke the law, according to the state auditor.

Public Health "paid the research foundation to administer the program from the funds that the Legislature had intended it to use directly for childhood injury prevention programs," the audit found.

The SDSU Research Foundation was also operating without a valid contract, meaning it could not disburse state funds intended for childhood injury prevention, according to the audit.

Here are key points from the audit:

  • The Department of Health Services and the Department of Public Health violated state law by hiring a private contractor to manage the Kids' Plates Program, rather than having state employees perform the work.
  • The contractor performed services without an approved contract, and was unable to award any funds that could have been used to help prevent unintentional childhood injuries.
  • Health Services and Public Health spent roughly 40 percent of total appropriations received during four fiscal years, or nearly $2.1 million on the contractor's administrative costs for the Kids' Plates Program.
  • Public Health did not comply with its own contracting procedures when it awarded 115 grants to community agencies.
  • The Department of Social Services did not fulfill certain monitoring requirements for trust fund expenditures. As a result, one grantee overcharged Social Services by $10,189, and Social Services' Office of Child Abuse Prevention may have used trust fund money to pay for expenditures that did not meet the trust fund's requirements.
  • Social Services failed to fully publish certain information about the trust fund on its website as state law requires.


What do you think about this situation? Tell us in the comments below.


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Buck Shaw December 02, 2012 at 05:19 PM
I'm not surprised. "The Department of Health Services and the Department of Public Health violated state law" We've all known this happens all the time. What really ticks me off is under the guise of Holyness ( a nonprofit ) the Private San Diego State University Research Foundation along with many other nonprofit Foundations sucker monies from the public in much the same way all the time. I like to call these organizations the Full Employment Act for Researchers. "Give me your money and I will tell you what you already know with a smile. The Poor children will be ok! Bless you! Thank you for your money." Oh!, and by the way since I'm a nonprofit you can't find out what my salary is? "
Michael Craig December 03, 2012 at 06:23 PM
Wow-monies collected for the kids did not actually go to the kids?! Years from now we will probably find out the same thing about Proposition 30 which just passed. And people wonder why Americans have a greater mistrust for politicians promising to do good with our tax dollars.


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