In a newly released report, the City Council’s Independent Budget Analyst Andrea Tevlin says she supports the bulk of Mayor Jerry Sanders’ proposals for improving the city’s financial practices, but disagreed with some, saying they gave the mayor too much clout.

In particular, the IBA said the mayor’s role in nominating the three members of the audit committee – the panel that would oversee the auditor general – is problematic. This “audit organization,” the IBA said, needs to be more independent from the mayor, who also supervises the staff that will be preparing the very financial statements that the auditor will be inspecting for accuracy.

While the IBA strongly supports the creation and role of this audit organization, we have concerns over the degree of independence that will be accorded to this organization by virtue of the powers of appointment by the Kroll Report.

The IBA said that only one other major city allows the executive (in San Diego’s case, the mayor) to appoint audit committee members. That city, Denver, is actually now in the process of revising that provision in order to “reduce management influence,” the IBA said.

The audit committee should consist of two council appointees and one council member, the IBA said. In addition, the auditor general should either be elected or hired by the audit committee or City Council for a long-term contract.

The IBA also said that although Sanders is claiming to incorporate all of Kroll’s remediation proposals he ignored one suggestion that would place a check on one of his key efforts underway. Kroll wanted additional checks on Sanders’ business process re-engineering, an effort the mayor hopes will trim costs by analyzing city departments for efficiency and value. If he detects waste in the process, he wants the ability to trim the cost unilaterally and put the revenue to a different use.

That may not be appropriate, according to Tevlin’s report. Kroll said that “Interdepartmental transfers to meet budgetary goals, or for any other purpose, should not be permitted unless approved in advance by the City Council.” Tevlin’s report states that she agrees.

The IBA also wanted more information on the duties of a reform “monitor” called for in the report. And she expressed concern about the proposal to require the auditor general to participate in the handling of a whistleblower hotline for employees. The report also stressed the importance of allowing the council more time to review city documents, piggybacking on Kroll’s suggestion to give the city a 14-day window for studying financial disclosures before they are made public.

It has been our observation that the inevitable pressure to expedite item to the City Council often forces current docketing requirements to be relaxed which in turn compromises an already short review time for elected officials.

Read the full IBA report.

Update: This post originally – and incorrectly – reported that the IBA was concerned about the mayor gaining the power to appoint the auditor general. That is not true and has been corrected.


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