For seven years, Cal Fire placed money with the nonprofit California District Attorney's Association and paid them a fee to hold it.
Recently an investigation turned up that the Department of Forestry and Fire Protection set up an account to hide $3.6 million rather than depositing it into the state's cash-strapped general fund as required.
Cal Fire fell under scrutiny after claiming they were out of money.
The same type of claim that prompted an investigation of the state's Department of Parks and Recreation after it hid $20 million while parks were being closed because of budget cuts.
It turns out that the money, which came by way of legal settlements was used for equipment purchases and training, something that concerns Senator Jean Fuller, R-Bakersfield.
"This recent revelation of more hidden money is disturbing," she said. "Many residents I represent have been forced to pay a new so-called fire prevention fee, which is really a tax and doesn't even pay for any increased fire protection services. Yet, Cal Fire has had access to millions of dollars kept from public disclosure."
Fuller also said that taxpayers shouldn't be asked to pay more when the department has been deliberately hiding money.
"Californians have every reason to doubt assurances that more money isn't hidden somewhere," she added.
"And every reason to be bothered by talk of more taxes this year."
With an annual budget of about $600 million, Cal Fire is responsible for preventing and putting out wildfires on about 31 million acres.
Still the department claimed it was cash-strapped.
So, following Governor Jerry Brown's statement that the state could no longer afford to pay the full cost of putting out blazes in fire-prone areas, the state legislature passed a law last year requiring rural homeowners who rely on state firefighters to pay $150 a year for fire prevention services.
The fee was supposed to generate $200 million.
According to public records provided by Cal Fire to the State Board Of Equalization, approximately 26,465 fee payers are in Kern County.
Nevertheless, Gov. Brown played the entire issue down at a business event in West Sacramento last week, referring to the reports as a boring story.
"I always like stories that say we've got more money than I thought we had," Brown said.
"We're not going to not take it seriously. If there's a few million bucks laying around and somebody didn't put in the right account, we'll figure it out."