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AMENDED AGENDA
EUGENE CITY COUNCIL
November 20, 2017
5:30 p.m. CITY COUNCIL WORK SESSION
Harris Hall
Lane County Public Service Building
125 East 8th Avenue
Eugene, Oregon 97401
7:30 p.m. CITY COUNCIL MEETING
Harris Hall
Lane County Public Service Building
125 East 8th Avenue
Eugene, Oregon 97401
Meeting of November 20, 2017;
Her Honor Mayor Lucy Vinis Presiding
Councilors
Alan Zelenka, President Mike Clark, Vice President
Emily Semple Greg Evans
Claire Syrett Chris Pryor
Jennifer Yeh Betty Taylor
Note: This agenda has been amended to reflect the addition of an executive session
at the 7.30 p.m. meeting.
5:30 p.m. CITY COUNCIL WORK SESSION
Harris Hall, 125 East 8th Avenue
The Mayor opens the November 20, 2017, City Council work session.
A. WORK SESSION: Auditor Discussion
November 20, 2017, City Council Meeting
7:30 p.m. CITY COUNCIL MEETING
Harris Hall, 125 East 8th Avenue
Adjourn.
1. PUBLIC HEARING:
An Ordinance Concerning Fireworks Restrictions and Amending
Sections 4.934 and 4.996 of the Eugene Code, 1971
Manager: Introduces topic, presents background information.
Mayor opens the public hearing: Those wishing to speak during the
Public Hearing must submit a completed "Request to Speak"form to the
information desk, prior to the beginning of the Public Hearing. When you
come to the podium, please give your name, city of residence, and, for
Eugene residents, your ward if known; you will have three minutes to
comment. There are lights on the timer; the red light indicates the end of
three minutes.
Mayor: Closes the public hearing.
2. EXECUTIVE SESSION
Pursuant to ORS 192.660(2)(e) and ORS 192.660(2)(h)
Mayor: The Eugene City Council will now meet in Executive Session held
pursuant to ORS 192.660(2)(e) and ORS 192.660(2)(h) to discuss the
negotiation of a real property transaction and to consult with legal counsel
regarding current litigation or litigation likely to be filed.
Representatives of the news media and designated staff shall be allowed to
attend the executive session. All other members of the audience are asked
to leave the room. Representatives of the news media are specifically
directed not to report on any of the deliberations during the executive
session, except to state the general subject of the session as previously
announced. No decision may be made in executive session. At the end of the
executive session, we may return to open session and welcome the audience
back into the room.
November 20, 2017, City Council Meeting
The Eugene City Council welcomes your interest in these agenda items. This meeting location is wheelchair -
accessible. For the hearing impaired, an interpreter can be provided with 48 hours' notice prior to the
meeting. Spanish-language interpretation will also be provided with 48 hours' notice. To arrange for these
services, contact the receptionist at 541-682-5010. City Council meetings are telecast live on Metro
Television, Comcast channel 21, and rebroadcast later in the week.
El consejo de la Ciudad de Eugene agradece su interes en estos asuntos de la agenda. El lugar de la reuni6n
tiene acceso para sillas de ruedas. Se puede proveer a un interprete para las personas con discapacidad
auditiva si avisa con 48 horas de anticipaci6n. Tambien se puede proveer interpretaci6n para espanol si avisa
con 48 horas de anticipaci6n. Para reservar estos servicios llame al 541-682-5010. Las reuniones del consejo
de la ciudad se transmiten en vivo por Metro Television, Canal 21 de Comcast y son retransmitidas durante la
semana.
For more information, contact the Council Coordinator at 541-682-5010,
or visit us online at www.eugene-orgov.
November 20, 2017, City Council Meeting
EUGENE CITY COUNCIL
AGENDA ITEM SUMMARY
Work Session: Auditor Discussion
Meeting Date: November 20, 2017
www.eugene-orgov
Eugene
Agenda Item Number: A
THE FOLLOWING ITEMS ARE ATTACHED
A. Initiative to Amend Charter
B. Excerpt - Final Report of the Citizen Charter Review Committee (2002)
C. Auditor Study Group Notes
November 20, 2017, Work Session -Item A
ATTACHMENT A
Ballot Measure 20-283
CAPTION: Amends Charter: establishes office, duties of independent elected City Auditor.
QUESTION: Shall City Charter be amended to establish office of elected City Auditor to
independently audit city operations and activities?
SUMMARY: This Charter amendment establishes new Office of Independent City Auditor, led by
elected City Auditor. City Auditor must be certified; and have five years' relevant
experience. Election held every four years. Auditor and auditor's office are independent,
not subject to City Council or Manager direction or supervision.
Auditor has authority to perform financial, performance, compliance, or other audits of
any city funded operation; may oversee other city audits. Auditor must establish
whistleblower hotline, conduct investigations of reports of fraud, waste, abuse,
mismanagement, or illegal activity.
City officers and employees must cooperate with auditor's office, provide unrestricted
access to documents, people, other information, facilities necessary for audits. Auditor's
activities subject to outside peer review. All audit reports and peer reviews posted on
auditor's website.
City must fund Auditor's office at not less than 0.1% of City's total budget
(approximately $677,000 for FY18) which includes auditor compensation. Auditor paid
at least 70% of averaged salaries of Eugene and Salem City Managers and EWEB General
Manger (approximately $153,000 in 2017), plus same benefit package as Eugene City
Manager.
(00247225;11 November 20 2017, Work Session - Item A
EUGENE CHARTER — CITY AUDITOR
The people of the City of Eugene amend the City Charter to create an Office of the Independent Auditor
led by an elected City Auditor as set forth in this new Section 55 of the Eugene Charter:
SECTION 1. Findings
1. Public officials, government managers, and private citizens want and need to know whether city
funds are handled properly and whether public programs are cost effective.
2. Independent audits, conducted according to Generally Recognized Government Auditing
Standards, provide objective, timely, and accurate information about city operations. Audits
promote improved government decision-making, service delivery, and cost savings. Finally,
audits improve transparency and accountability to the public for city operations.
3. To ensure that audits of city operations are conducted independently and in a manner accountable
to the public, the City Auditor shall be elected and lead an Office of the Independent Auditor.
SECTION 2. Duties and Responsibilities of City Auditor
1. The Office of the Independent Auditor is hereby established and shall be headed by an elected
City Auditor.
2. The City Auditor shall have the authority and responsibility to conduct, or cause to be conducted,
financial, compliance, performance, special studies, or other audits of all aspects of the City of
Eugene's government operations. In addition, the City Auditor shall have the authority to oversee
any audits contracted for and funded by the City directly (i.e. not through the City Auditor),
including the comprehensive annual financial report.
3. The City Auditor shall have the authority to conduct audits of all city operations and activities,
including but not limited to: departments, offices, boards, activities, agencies, contracts,
franchises, projects, and programs to determine whether:
a. the City is acquiring, documenting, managing, protecting, and using its resources
economically, efficiently, equitably, and effectively;
b. the intended outcomes of the activity are achieved;
c. the public is benefited by the activity;
d. further investigation or corrective action is necessary to address evidence of potential
fraud, waste, abuse, or illegal acts.
e. financial and other reports are unbiased and disclose all relevant information fully and
accurately; and
f. the City Council is informed of problems in a timely manner.
4. The City Auditor shall:
Eugene Charter Amendment — City Auditor Page 1
a. establish and maintain a public website linked to the City's website to make audits,
annual reports, schedules, and other items of public interest publicly accessible;
b. establish procedures, including a "Whistleblower Hotline" for receiving and investigating
anonymous or non -anonymous reports of fraud, waste, abuse, mismanagement, or illegal
activity and shall publicize the availability of that hotline to employees, city officials,
vendors, and the public;
c. maintain the confidentiality of information received during an audit consistent with state
and federal law
d. maintain auditor working records and documents consistent with state law, but for at least
ten years;
e. provide audit or non -audit services requested by the City Council or the City Manager,
when consistent with available funding and priorities as determined by the City Auditor.
5. The City Auditor shall have authority to interpret the requirements of this Charter amendment and
to promulgate rules and policies as necessary to carry out the duties of the Office of the
Independent Auditor.
SECTION 3. Election of City Auditor
1. The City Auditor shall be elected pursuant to Section 20 of this Charter and state law.
2. The position is full time and non-partisan.
3. Qualifications. Notwithstanding Section 19 of this Charter, the City Auditor must possess at
least a bachelor's degree and at least one of the following certifications: Certified Internal
Auditor (CIA): Certified Public Accountant (CPA): or Certified Government Auditing
Professional (CGRP). The auditor must also have at least five years of recent auditing,
evaluation, analysis, or otherwise comparable experience. The City Auditor shall be a
qualified elector in the United States. The Auditor must remain certified and qualified as such
throughout the term of office.
4. The election for City Auditor will be conducted city wide and will occur every four years,
two years opposite the election cycle of the Mayor.
a. The candidates for city Auditor shall file to be a candidate under the same procedures as
other candidates for elected city position. In addition, they must file a resume or other
statement which they affirm as accurate, documenting that they meet the qualifications
for City Auditor set forth herein. That statement shall be published in the Voters'
Pamphlet.
b. The term of office of a person elected shall commence on the first Monday in January
following the election, unless one candidate receives a majority vote in the primary
election, in which case the term shall commence as soon as is reasonably feasible but no
later than July 1 of the same year.
c. The City Auditor will serve until a successor is elected and qualified.
Eugene Charter Amendment —City Auditor Page 2
d. The office of the City Auditor becomes vacant upon the incumbent's death, recall,
resignation, adjudicated incompetence, or conviction of an offense pertaining to the
office. The City Council shall appoint an interim auditor within 90 days of a vacancy
occurring.
e. If a deputy in the Office of the Independent City Auditor meets the qualifications herein,
then that person shall be appointed by the City Council to serve as the interim City
Auditor until the successor to the office is elected and takes office as set forth in Section
(4) of this charter amendment.
If the office of the City Auditor becomes vacant more than 100 calendar days before the
May election, the election to fill that vacancy shall be conducted at the next May election
of the same year. If the vacancy occurs less than 100 days before the next May election,
the election to fill that vacancy shall be conducted at the May election of the following
year. If an election to complete the term of the vacated position coincides with the
regularly scheduled primary election for the City Auditor position, then only the regularly
scheduled primary election shall proceed.
g. If a City Auditor elected under this Charter Section (55) would serve a term of less than
one and one half (1.5) years, that auditor's term shall be extended to encompass the four
(4) years of the next term without an additional election. Thereafter, the election cycle
will resume as stated herein.
h. In the event this Charter amendment is approved by voters on or before the May 2018
election, then the first election for the office of City Auditor shall be held at the regularly
scheduled November 2018 election. The candidate who receives the most votes will win
and take office in January 2019. Thereafter, the election cycle will resume as stated
herein.
5. The City Auditor will take the oath or affirmation as provided for the City Councilors and
Mayor, and shall be subject to recall pursuant to Article II, section 18 of the Oregon
Constitution.
SECTION 4. City Council and City Auditor Cooperation
1. The City Manager and city administration must cooperate with the City Auditor and the auditor's
office to achieve the objectives of this charter amendment.
2. The City Auditor shall prepare a budget for the Office of the Independent Auditor, which will be
submitted to the Budget Officer, with a copy provided directly to the City Council. As part of the
City's annual budget process, the City must provide the City Auditor's office with the facilities,
equipment, and staffing necessary for the office to perform its duties. At a minimum, the budget
for the Office of the Independent Auditor, including the City Auditor's compensation, must be
funded at a level not less than 0.1 % of the City's total adopted annual budget.
3. The City Council shall provide total compensation for the City Auditor as follows: a benefit
package equal to that provided to the Eugene City Manager and a salary that is not less than 70%
of the average of the salaries of the (a) Eugene City Manager; (b) Salem City Manager, and (c)
the Eugene Water and Electric Board's General Manager.
Eugene Charter Amendment —City Auditor Page 3
4. The City Auditor and auditor's employees are independent of the City Council and City Manager,
and are not subject to the authority of the City Manager under Section 16 of this charter or
otherwise. The City Auditor has authority to appoint, evaluate, promote, and remove employees
in the Auditor's office, and to prescribe their duties and compensation. All such employees serve
at the pleasure of the City Auditor.
5. The City Auditor shall have authority to consult, contract with or hire independent professionals
to assist the auditor's office in fulfilling its duties including, but not limited to, certified public
accountants, management consultants, and legal counsel.
6. Every City contract, agreement or grant must contain a "right -to -audit" clause that obligates the
recipient of city funds to provide the City Auditor access to employees and to all financial and
performance records, property, and equipment, purchased in whole or part with public funds, as
needed to complete the audit.
7. The City Auditor must submit both a short term (one year) and long term (four year) audit plan
and schedule to the City Council, City Manager and the public for review and comment, but not
approval. This annual audit plan shall be completed within 30 days of the end of each fiscal year.
The City Auditor has authority to select all audits planned and implemented and determine or
amend audit schedules.
8. The City Auditor shall be provided time on the City Council agenda for public hearing or
discussion, whenever requested.
9. City officers and employees must provide the City Auditor (and designees) with unrestricted and
timely access to all employees, information, data, and records (including electronic data) that are
within their custody and that the auditor believes necessary or useful to complete the audit. City
officers and employees must also provide unrestricted access for the auditor to inspect all city
property, equipment and facilities. The City cannot charge the auditor's office for producing or
copying this information, data or records.
a. If access is unreasonably delayed or withheld, the City Auditor shall have authority to
initiate a search and examine records. In addition, the City Auditor shall have authority
to issue subpoenas to complete the audit.
b. If any person subpoenaed as a witness or compelled to produce records fails or refuses to
comply, then the proper court, upon the request of the City Auditor, shall have power to
compel a response and to punish as contempt of court refusals to comply.
10. The City Auditor has the authority to retain its own legal counsel.
SECTION S. Audit Standards
1. Each audit will be conducted in accordance with the "Generally Accepted Government Auditing
Standards" issued by the Comptroller General of the United States.
2. The City Auditor will provide a draft of each audit report to the City Manager and senior
administrator for the audited program for review and response before making the audit report
Eugene Charter Amendment — City Auditor Page 4
public. The City Manager and/or administrator will provide a written response within a
reasonable time frame specified by the auditor. That response shall be included in the audit report
in whole or in a summary. If no response is received, the auditor will document that fact and
release the audit report.
3. Each audit shall result in a written report that is provided to the City Council and City Manager
and posted on the City Auditor's website. The report shall contain relevant background
information, findings, and recommendations.
4. The City Auditor shall prepare an annual report that describes the audits completed, major
findings, and recommended corrective actions. The report shall be submitted to the City Council
and made available to the public.
5. The City Auditor shall follow-up on audit recommendations as practical to determine if corrective
action has been taken. The City Auditor may request periodic status reports from audited agencies
regarding corrective actions taken.
6. The activities of the City Auditor's office shall be subject to peer review in accordance with
Generally Accepted Government Auditing Standards and by a professional, nonpartisan objective
group utilizing generally recognized guidelines specific to local government auditing. The City
Auditor shall pay for the costs of the peer review from the City Auditor's budget. A copy of the
written report of this independent review shall be furnished to the City Council and be made
available to the public.
SECTION 6. Miscellaneous
1. If there are conflicts between the provisions of this Charter amendment (Section 55) and any
provisions of other sections of the Eugene Charter, the provisions of this Charter amendment
(Section 55) shall prevail.
2. If any part, section or provision of this Charter amendment is found unconstitutional, illegal or
invalid, such a finding will affect only that part, section or provision of the ordinance and the
remaining parts, sections or provisions shall remain in full force and effect.
Eugene Charter Amendment —City Auditor Page 5
ATTACHMENT B
FINAL REPORT OF THE CITIZEN CHARTER REVIEW COMMITTEE
D. City Performance Auditor
Recommend Amendment to the Charter
Vote on Recommendation: Unanimous
Add New Section to the Charter As Shown Below
New Section City Pef formance Auditor. the city performance auditor shall be
appointed by the city council. The pef formance auditor shall conductor cause to
be conducted performance audits and may conduct studies intended to measure or
improve the performance of city functions following generally accepted
government auditing standards. The performance auditor maybe removed from
office with or without cause by the city council. The performance auditor shall
possess adequate professional proficiency as demonstrated by a relevant
certification such as a Certified Public Accountant, Certified Internal Auditor, or
Certified Management Accountant, which shall be retained throughout tenure in
the position. All audit reports are public records. Tlie city council shall provide
for the creation of an audit committee to oversee the performance auditor. The
audit committee shall include the city manager and other members as defined by
ordinance. Among its duties, the committee shall forward candidate
recommendations for the auditor position to the city council.
In the initial discussions by the City Council, the consideration of a "possible City auditor
position" was one of the specific tasks assigned to the committee. In undertaking this task, the
committee reviewed the performance assessment being done by City staff, the types of audit
work being done by City staff or contracted out, auditor positions in other jurisdictions; and how
a performance auditor might be beneficial to the City of Eugene.
Financial Services Division staff provided information to the committee on the types of audits
done under the categories of economy and efficiency audits, program audits, and financial -related
audits, both internally completed and contracted out. The City uses "service profiles" and
"performance measures" as tools in the organization's budget work in an ongoing effort to
effectively and efficiently deliver services. There are 45 service areas in the City organization.
According to Dee Ann Hardt, Financial Services Director, "City staff do not perform formal
performance audits." "The service profiles the City has completed over the past several years
and the performance measures contained in those profiles are not audited". Of the five elements
listed in the Yellow Book for a performance audit according to GAGAS, the profiles/measures
represent only the first of five elements, "Criteria," in a formal performance audit.
Refer to the information in Appendix O regarding the performance audit work being done by the
City of Eugene and Appendix P, which summarizes all of the audit type work currently being
undertaken in the City.
FINAL REPORT OF THE CITIZEN CHARTER REVIEW COMMITTEE - JANUARY 14, 2002 Page 19
November 20 2017, Work Session - Item A
FINAL REPORT OF THE CITIZEN CHARTER REVIEW COMMITTEE
Two lay members of the Budget Committee were invited to a committee meeting to share their
thoughts on the usefulness of the service profiles. In addition, at the request of a member of the
committee, elected Portland City Auditor Gary Blackmer attended a committee meeting and
offered examples of audit work done in Portland. Mr. Blackmer discussed and clarified the
nature of the audit function in the City of Portland. He also noted that performance auditing.
standards are clearly defined in the Yellow Book, which is developed and improved by the US
Government Accounting Office (GAO). The committee also received correspondence from
Dean Stephens, the Lane County appointed auditor on these same topics.
Further research on municipal auditors was provided by committee members. The research
indicates that the Government Finance Officers Association (GFOA), the American Society for
Public Administration (ASPA), Association of Government Accountants (AGA), International
City Managers Association (ICMA), the National Association of Local Government Auditors
(VALGA), and numerous other state municipal associations as well support the concept of a
municipal auditor.
The National Association of Local Government Auditors believes that audits of local government
programs, functions, activities, and organizations are essential. They believe as an integral part
of the governance process, the audit function plays a key role in providing accountability for
management's performance. The primary. mission of the auditor is to require an accounting of
the activities and accomplishments of the organization. As an integral part of the governance
process, the audit function plays a key responsibility role in providing accountability for
management's performance.
Refer to Appendix J, So... You Think You Might be Interested in Hiring a Performance Auditor,
for more information on performance auditors and Appendix K for guidelines for model
legislation related to performance auditors.
The trend for auditors has emerged because government officials, both elected and appointed,
have realized that an independent oversight function is particularly important because of the
unique relationship that government auditors have with their primary stakeholders, the taxpayers.
The taxpayers and, for the most part, elected representatives want assurance that their scarce tax
dollars are being protected by audit functions that operate with reasonable independence from the
supervisory chain. Anything less severely limits the credibility of the auditor in terms of the
public trust.
The committee believed that was a need for an audit function and also discussed a contracted
auditor versus and in-house City performance auditor. There are pros and cons to outsourcing
versus in-house. The committee determined that the auditor should be a part of the
organizational structure versus contracted out. In-house auditors can be more costly in terms of
FINAL REPORT OF THE CITIZEN CHARTER REVIEW COMMITTEE - JANUARY 14, 2002 Page 20
FINAL REPORT OF THE CITIZEN CHARTER REviEw COMMITTEE
overhead costs such as fringe benefits, but contractors charge a lot and may not always get to the
root of problems if funds are limited. It is difficult to select a good contractor and once selected,
it is difficult to ensure that the same people will work on all of the projects.
A comprehensive picture and depth of knowledge of the organization is important to the success
of the audit position. There can be a mix of in-house and outsourcing based on efficiency, of
course. However, opponents of outsourcing maintain that because management is paying for
services rendered, independence from political pressure on the out source auditor is severely
compromised. If the auditor is involved in the day-to-day operations of the government, they
can plan the best places to audit. Being a part of the government organization also says to the
public that the City government is on alert for savings and improvements. The auditor, managers
and staff will be working in a cooperative effort, sharing a common goal, to solve problems that
improve service and save tax dollars that can further service the community. Refer to Appendix
L for a report on bench marking and best practices.
In further looking at the issue of in-house versus contracted out, the committee sought additional
information from the GAO. The concern raised by the GAO was the audience of the audit
reports. In sum, if the audits are to be distributed to the legislative body, the press, and the public
and those directed to management, steps need to be taken to ensure that the government audit
organization is established in such a way to be considered free from organizational impairments
to independence to report externally. The GAO representative's e-mail on this topic is in
Appendix M. Refer to Appendix N for e-mail messages regarding auditors.
This led the committee to determine that the audit position should be appointed by the City
Council, not the City Manager, in order to retain "external auditor" characteristics.
In discussions on a City performance auditor, an auditor hired by the City Council and how this
would be implemented in the City of Eugene, there concern regarding the form of government
and if this would represent duplication of management effort. The performance auditor position,
as recommended, does not change the government structure. The position is more focused on the
operation of a particular government service. The auditor advises the organization, but does not
set policy or manage. The auditor provides information to assist the council in budgeting and
effective oversight. Audits usually resolve operational issues with management before the audit
report reaches the council via the audit committee. Audits are "bad new/good news": the bad
news is that there was a problem, the good news is that it is being fixed. If a City Manager could
get fired for a problem he or she might wish to hide from the City Council, the auditor can help a
City Manager identify and resolve problems before they result in a firing, saving the City
organization from the expense of hiring a new manager in the process.
FINAL REPORT OF THE CrrIZEN CHARTER REVIEW Comm TTEE - JANUARY 14, 2002 Page 21
FINAL REPORT OF THE CITIZEN CHARTER VIEW COMMITTEE
The performance audit position would not be a duplication of effort or another layer of
bureaucracy, but a gauge of government operations geared toward better quality government.
Auditors can identify savings and improvements as a result of detailed analysis that could not be
provided solely by staff in an organization. The performance auditor would present findings and
recommendations to the City Council and to the City Manager.
Having decided to recommend an auditor, the committee also considered the cost of such a
position. The Portland City Auditor, Mr. Blackmer, felt that for the size of the City of Eugene,
one auditor would be sufficient. He further felt that while often performance auditors pay for
themselves with identified savings each year, the committee should not focus solely on the
financial aspects, because unmeasurable accountability and improvements in the quality of
service is also purchased with performance audits. The committee concurred with the opinion
that one auditor would suffice for the City of Eugene at present. The Key Elements to a
successful and effective independent performance auditor position is provided in Appendix K.
According to the NALGA's education committee report, "So... You Think You Might Be
Interested in Hiring a Performance Auditor," found in Appendix J, it is not uncommon for an
audit function to realize an annual return on investment between 200 percent and 400 percent.
Some members of the committee expressed their belief that the City Manager needed to have a
an active role with regard to the City performance auditor to ensure that the manager retained
control over the management of the organization. In response to this concern, the committee
recommended that an audit committee should be included as an additional check and balance.
As proposed, the audit committee would act as the hiring advisory committee. The audit
committee would also review risk criteria used to select performance audits and endorse the
performance auditor annual audit plan. The audit committee would also review the progress of
audit work and draft audit reports, mediate differences between the performance auditor and
those being audited, and provide input on general audit matters. An example of audit committee
functions can be found in Appendix Q, Audit Committee in Jackson County, Oregon.
In order to keep the process collaborative with management, it was decided to have the City
Manager participate in the audit committee to the extent that the independence of the auditor not
be impaired. The committee referred the specific makeup of the audit committee to the council,
but generally agreed upon a seven -member committee composed of three councilors, two lay
members of the Budget Committee, the mayor, and City Manager.
While the motion for the recommended charter language did pass unanimously, two members of
the committee wished to note their concerns with the language for the record. First, one member
expressed concern that the proposal does not include input from the City Manager in the
FINAL REPORT OF THE CITIZEN CHARTER REVIEW COMMITTEE - JANUARY 14, 2002 Page 22
FINAL REPORT OF THE CITIZEN CHARTER VIEW COMMITTEE
appointment process. Secondly, two members wished to note for the record their concern that
the proposed audit committee was not codified in the proposed language.
FINAL REPORT OF THE CITIZEN CHARTER REVIEW COMMITTEE - JANUARY 14, 2002 Page 23
ATTACHMENT C
November 10, 2017
Mayor Lucy Vinis
Eugene City Council
125 E 8d' Ave, 2nd Floor
Eugene, OR 97401
Dear Mayor Vinis and Members of the Eugene City Council:
The Eugene City Auditor Study Group is pleased to present our matrix with accompanying
profiles for your consideration as you discuss topics pertinent to a Performance Auditor for the
City of Eugene. In this cover letter, we describe our group's intent and the process and methods
we used to develop these materials. We also include a glossary of terms to help you understand
our matrix.
Formation and Composition. In early August, Mayor Vinis convened our 11 -member study
group and charged the group to develop an objective, factual matrix of models for a performance
auditor position. The group was specifically asked not to make recommendations. The matrix
was to form the framework for the City Council's work session, as well as frame the issues in
public conversation. The study group met publicly for seven meetings during a 10 -week period.
We maintained a website at www.eugeneperfonnanceauditor.org.
The all -volunteer study group was ably assisted by Emily Mooney, co-chaired by Marshall
Wilde and Norma Grier, and included the following members:
Bobby Green
Brittany Quick -Warner
Dave Fidanque
Janet Calvert
John Barofsky
Josh Skov
Phil Carasco
Ryan Moore
Tai Pruce-Zimmerman
What Is Performance Auditing? While many government bodies and businesses are familiar
with financial auditing, performance auditors work to ensure taxpayer funds are used efficiently
and effectively and that government programs and services are fulfilling their intended functions.
Auditor reports and findings are usually publicly available. While performance auditors are
known to help a city spend money wisely and even save money, the best outcome is to help
government effectively fulfill its intent.
Standards for Performance Auditing. Performance auditors are guided by Generally Accepted
Government Auditing Standards (GAGAS) that can be found in what is commonly referred to as
the "Yellow Book" issued by the U.S. General Accountability Office. Many, but not all,
performance auditors follow these standards. An auditor must operate independently from the
November 20, 2017, Work Session -Item A
audited government entity, a goal achieved in a variety of different ways by different cities.
Auditors choose audit topics through a risk assessment process. They are expected to have
appropriate training and certification, their work must follow protocols that ensure their focus,
findings and recommendations are appropriate, and their performance is subject to a "peer
review" process every three years. The national nonprofit Association of Local Government
Auditors (ALGA) is also a rich resource on this topic.
Methodology. The study group assembled a matrix using examples from ten cities (including
the proposed ballot measure for Eugene), one county, and one city -county combination. Each
community that we included in our matrix is more fully described in an accompanying one-page
profile.
Some of the governments we included have worked with an auditor for many decades.
Performance auditors can be elected or appointed, or they can be external and work on contract.
While the group initially tried to find examples from cities with similar populations and budgets
to Eugene, we quickly learned that pinpointing similar communities was difficult because other
cities' budgets often included either public utilities or major airports that quickly ballooned the
figures. The variability on budgeting made it impossible to authentically represent the auditor's
budget as a percentage of a city's overall budget.
The topics that threaded through our research include:
• need for the auditor's independence,
• access to the personnel and records of the audited entity and the city's contractors,
• checks and balances on the auditor's work,
• how audit topics are selected, and
• how funding for the auditor's office is provided.
Our group also noted any unique features of auditor functions in other cities that may be
pertinent or of interest to Eugene.
Glossary. The following glossary of terms (as used by our group) will help you better
understand our matrix and profiles:
Access: The ability to obtain necessary information to perform the performance auditing
function, including authority to interview employees, review public records, and obtain financial
data from entities that contract with a city.
Accountability: The process for ensuring that the auditor performs in compliance with
professional standards in selection of audit topics, performance of the audits, and subsequent
actions related to the audit function. Provisions regarding an audit committee and work
performance are also pertinent to accountability.
Funding: Financial resources for staff, office expenses, and contracting for outside auditors,
consultants, outside counsel, and similar expenses.
2
GAGAS: Generally Accepted Government Auditing Standards. These are the rules printed in the
General Accountability Office's "Yellow Book" that describe how performance auditors should
perform their professional functions.
Independence: The ability to perform the professional functions of the auditing office without
interference from parties interested in the outcome of the audit.
The study group is soliciting public comment on our documents via our website, and we may
make appropriate modifications based on comments we receive between now and Wednesday,
November 15. We expect to summarize the comments at our presentation at the City Council
work session on November 20, 2017.
In conclusion, cities make a number of choices about size, scope, and accountability when
establishing a performance auditing function. We do not see that a single "right answer" exists
for every city, but rather that each city should consider the advantages and disadvantages of these
choices in light of its challenges.
Sincerely,
Marshall Wilde Norma Grier
Co-chair Co-chair
3
Government and Demographics
Auditor Office
Independence and Funding
Access
Accountability
Other Provisions
City
Popula-
City
Who has
Elected or
Size
Size of
How are
Who has
Who
Access
Provisions regarding an
Duties, powers, budget,
tion
Budget
executive
Appointed
of
Audit
audit
supervisory
determines
provisions for —
audit committee, special
pay, etc
authority?
Audit
Budget
topics
authority
the size of
personnel, city
provisions regarding work
Office
decided?
over audit
the audit
records,
performance, recall, and
staff?
budget?
contract records
similar measures
Albany, NY
98,000
$177M
Mayor
Elected
4
$421K
Auditor
Elected
Council
By city policy,
No recall provisions in NY;
Relatively new =8 years.
sets work
auditor,
access to all
re-election.
Must be resident. No
plan and
non-union
records.
qualification requirements.
seeks
staff
No requirement for audit
Must appoint a deputy to
input but
committee.
cover when unavailable.
not
Auditor approves all city
approval.
payments. Goes to city
attorney for counsel, but
also has budget for outside
professionals. Works pretty
well — important function.
Understaffing sometimes a
problem.
Berkeley,
113,000
—$160
City
Elected
13.5
$2.3M
Auditor
Head
Council
By audit
Recall provisions
All contracts must be co-
CA
M
manager
with
elected
standards -full
signed by auditor, minimum
general
council
auditor
access to all.
No requirement for audit
salary, exemption from
fund
input.
committee
"across the board" budget
cuts.
Boise, ID
223,000
$600M
Mayor
Appointed
2
$232k
Auditor,
Director of
Council
By audit
Removal for cause only, by
Fiduciary duty to the public
approved
audit
standards -full
a council supermajority
required by code.
by
services
access to all.
council.
No requirement for audit
committee
Centennial
110,000
$86M
City
Contract
0
$296K
By audit
N/A
Council
Per contract
Contract termination
Centennial City does not
City, CO
manager
auditor
board.
have any employees
Various entities select the 8-
assigned to performance
member audit committee
audit. All audits are
contracted. Most audits
related to a local tax.
Government and Demographics
Auditor Office
Independence and Funding
Access
Accountability
Other Provisions
City
Population
City
Who has
Elected or
Size
Size of
How are
Who has
Who
Access
Provisions regarding an
Duties, powers, budget,
Budget
executive
Appointed
of
Audit
audit
supervisory
determines
provisions for —
audit committee, special
pay, etc
authority?
Audit
Budget
topics
authority
the size of
personnel, city
provisions regarding work
Office
decided?
over audit
the audit
records,
performance, recall, and
staff?
budget?
contract records
similar measures
Denver,
700,000
$1.213
Mayor
Elected
51
$4.5M
Auditor
Auditor
Council
Charter
State recall provisions
Charter states no city
CO
sets work
provisions
ordinance can compromise
plan and
provide full
Seven -member audit
the auditor's independence.
seeks
access.
committee chaired by
Auditor countersigns every
input but
auditor with 2 members
contract and ensures that
not
each appointed by Mayor,
all city contracts pay the
approval.
Council and Auditor
prevailing wage. All audit
reports include an
implementation date for
recommendations at which
time the auditor performs a
follow-up.
Eugene
167,000
$676M
City
Elected
^3
$670K
Auditor
Auditor
Minimum set
Charter
State recall provisions
Independent legal advice,
Petitioner
(plus
manager
sets work
in charter,
language
minimum budget and
Proposal
EWEB
plan and
city council
provides full
No requirement for audit
minimum pay for auditor
$307M)
seeks
may augment
access and
committee
set in charter.
input but
allows auditor to
not
subpoena
approval.
I records.
Eugene
167,000
$676M
City
Appointed
1
$150K
By risk
N/A (no
Council
Implied by
Audit committee that
The proposed charter
Charter
(plus
manager
(est)
analysis
staff)
(implied)
reference to
includes City Manager,
language left some issues
Review
EWEB
by
GAGAS
Mayor, 3 councilors, and 2
undefined, presumably for
Committe
$307M)
auditor,
standards, but
lay budget committee
clarification in an ordinance.
e(2002)
as
not specifically
members to advise on
approved
addressed.
hiring, performance, audit
by audit
topics and mediation with
comm.
staff.
Government and Demographics
Auditor Office
Independence and Funding
Access
Accountability
Other Provisions
City
Population
City
Who has
Elected or
Size
Size of
How are
Who has
Who
Access
Provisions regarding an
Duties, powers, budget,
Budget
executive
Appointed
of
Audit
audit
supervisory
determines
provisions for —
audit committee, special
pay, etc
authority?
Audit
Budget
topics
authority
the size of
personnel, city
provisions regarding work
Office
decided?
over audit
the audit
records,
performance, recall, and
staff?
budget?
contract records
similar measures
Lane
363,000
$600M
County
Appointed
1.25
$170K
By risk
Auditor
Commission
Lane Code
Dismissal only on advice of
Significant gaps in staffing
County,
administra
analysis
guarantees
Audit Committee.
the office historically.
OR
for
by
access.
auditor,
County Commissioners
approved
appoint five voting
by audit
members; five county
board.
managers serve ex -officio
Long
470,000
$2.713
City
Elected
22
$2.7M
Auditor
Head City
Submitted by
Audit Standard -
Recall provisions
Minimum salary, CPA is
Beach, CA
manager
sets work
Auditor
Financial
full access
required qualification, the
plan and
Management
No requirement for audit
auditor signs all checks.
seeks
Dept and
committee
input but
approved by
not
city manager
approval.
I and council
Oakland,
420,000
$1.36
Mayor
Elected
10
$1.9M
By
Auditor
Mayor/
Audit Standards
Recall provisions
Financial analysis of ballot
CA
auditor, in
Council
-full access
measures, retaliation
the public
No requirement for audit
complaints, whistleblower
interest,
committee
protection, public financing
or as
audit, residency required,
required
minimum salary. Auditor
by council
estimates that the office is
or mayor.
staffed at 50% of necessary
level.
Orlando,
277,000
$1.213
Mayor
Appointed
5
$746K
By
Internal
Council
Per contract for
Employment policies for
The majority of audits
FL
($446M
internal
(includ
auditor,
auditor
contractors, by
employees. Contract
performed are for a unique
general
auditor.
es
approved
ordinance for
termination for contracts.
program called a Municipal
fund)
Contract
council
by audit
internal
Public Services Tax Audit
external
suppor
board.
documents
Mayor appoints 5 -member
that charges taxes based on
auditor.
t staff)
audit board
the use of certain utilities.
Government and Demographics
Auditor Office
Independence and Funding
Access
Accountability
Other Provisions
City
Population
City
Who has
Elected or
Size
Size of
How are
Who has
Who
Access
Provisions regarding an
Duties, powers, budget,
Budget
executive
Appointed
of
Audit
audit
supervisory
determines
provisions for—
audit committee, special
pay, etc
authority?
Audit
Budget
topics
authority
the size of
personnel, city
provisions regarding work
Office
decided?
over audit
the audit
records,
performance, recall, and
staff?
budget?
contract records
similar measures
Phoenix,
1,615,000
$1.313
City
Appointed
24
$2.85
Auditor;
Auditor
Auditor
City code
At -will employee
Current auditor appointed
AZ
manager
M
approved
submits to
guarantees
4/2017, but previously
by Audit
City
access; enforced
9 -member audit committee:
served as Maricopa County
Comm.
Manager,
by department
Mayor appoints six (3 city
Auditor (in Phoenix) for 22
with 15%
approved by
heads and City
councilors and 3 public) plus
years. In County position,
reserved
Council
Manager, all
City Manager and 2
he once needed to use
for un-
contracts
department heads
outside counsel to access
planned
include auditor
documents.
requests.
access provision
Portland,
640,000
$4.213
Mayor
Elected
11 in
$2.5M
Auditor
Auditor and
Submitted by
Audit standards
State recall provisions
Auditor supervises 8
OR
and 4 City
perf.
sets work
Director of
auditor to
-full access in
departments: police
Commis-
audits
plan and
audit
city com-
charter and code
No requirement for audit
auditor, hearing officers,
sioners
plus
seeks
services
missioners,
committee; current auditor
elections, public records,
direct
input.
bypassing
selects own "sounding
lobbying regulation, and
or
budget office
board."
more. Gets minimum salary.
Can seek outside counsel
Albany, New York
Population is 98,000 City Budget is $177 million Mayor has executive authority
Elected Auditor has 4 performance audit staff and a $421,000 budget
In a partisan election, Albany elects a City Auditor to a four-year term. With local elections
dominated by the Democratic Party, the party primary election generally determines the winner of
the general election. In the 8 years the office has existed, there have been 3 primary elections,
two of which have been contested (both Democratic).
DUTIES OF AUDITOR The auditor supervises a staff of 3 additional personnel — a deputy
required to be appointed by City Charter, and two analysts. The auditor must approve all
payments by the city, which serves as an incentive for cooperation with this office.
INDEPENDENCE The auditor has sole discretion for determining audit topics, usually with
discretionary input from the Council and other stakeholders. The auditor performs the audits in
compliance with the Generally Accepted Government Auditing Standards, including provisions
regarding a response from the audited entity. The office conducts follow up activities on audit
recommendations and posts these reports. The office has a budget for outside consulting,
including counsel, but generally relies on the Corporation Counsel (City Attorney) for legal
services.
ACCESS TO INFORMATION The auditor does not have formal access language in the City
Charter, other than general language authorizing audit activities. The office reports no problems
getting access to records.
ACCOUNTABILITY There are no formal qualifications for office, other than residency in the
city. The first auditor, who just left office, came from a planning background and only received a
certification while in office. There are no provisions for recall or an audit committee.
FUNDING The budget is determined by the elected Auditor submitting a proposed budget to the
Common Council, which approves it. In the words of the analyst currently filling in as auditor,
"He doesn't have to defend it in the same way as other departments, since he is elected," per the
civil service staff in the office. There is no formal language requiring this deference, however.
OTHER UNIQUE PROVISIONS The audit staff report that the system works well. They do not
report significant resistance from city staff to the auditing function, and city responses to audits
indicate compliance. The staff reported that short -staffing is a problem, as the most -recently
elected auditor decided to leave before the end of his term, along with the deputy auditor
appointed by him. If there's a vacancy after July 1, there is no special election and apparently no
authority to appoint an interim candidate. Thus, a vacancy can last 6 months.
Berkeley, California
Population is 113,000 City Budget is $160 million City Manager has executive authority
Elected Auditor has 13.5 performance audit staff and a $2.3 million budget
Berkeley has an elected City Auditor. Candidates for the office must meet the same eligibility
criteria as candidates for Mayor or City Council: US citizenship and residency and voting rights
in the city of Berkeley. The City Auditor is a non-partisan seat elected on the General Municipal
Ballot during non -Presidential election years (i.e., every four years). The City Council appoints to
fill any surprise vacancy.
DUTIES OF AUDITOR Berkeley's City Auditor has the authority and responsibility to conduct
performance and financial audits of all aspects of city government. By charter, the City Auditor
must also countersign all city contracts.
INDEPENDENCE While the final decision about the audit plan rests with the Auditor, the
Auditor must consult with the Mayor, City Council, and City Manager when selecting audit topics
and must provide a planned audit schedule to the City Council at the beginning of each calendar
year; however, this audit plan may still be modified later so long as notification is provided to the
City Council. The Auditor's office is exempt from across-the-board budget cuts.
ACCESS TO INFORMATION Berkeley's city charter explicitly grants the Auditor unrestricted
access to all city employees, officials, records, and reports, including the authority to compel any
branch or department to provide files and documents.
ACCOUNTABILITY In addition to re-election every four years and recall potential, there are
other checks on the authority of Berkeley's City Auditor. Per the City Charter, the mayor must
annually hire an independent Certified Public Accountant to audit all city accounts and books,
explicitly including the City Auditor's office, and the results of this audit must go to the Mayor,
Auditor, City Manager, and City Clerk, but may or may not be released to the public. All audit
results are required by the city charter to be made public.
FUNDING The City Charter allows the City Council to set the City Auditor's salary at anything
above $3,600 per annum and to provide sufficient funds for the office, subject to available
resources.
OTHER UNIQUE PROVISIONS While not written into the charter, the City Auditor has
historically utilized follow-up audits to motivate implementation and compliance with the goals
of certain audits and to track the office's own effectiveness. The current City Auditor, Anne
Marie Hogan, was first elected in 1994; since the city began archiving election results online in
2002, her seat has gone unchallenged.
Boise, Idaho
Population is 223,000 City Budget is $600 million Mayor has executive authority
Appointed Auditor is one of two performance audit staff with a $232,000 budget
The City of Boise's Office of Internal Audit was established in 2003 by ordinance and code and it
functions as an independent, objective assurance and consulting service. The Office strives to add
value and improve the city's operations by bringing to bear a systematic and disciplined approach
to the evaluation of risk management processes, activity -level controls, and governance processes.
DUTIES OF AUDITOR The Auditor investigates the effectiveness of controls that provide for
the protection and safeguarding of assets as well as the reliability of Boise's financial information.
The Auditor reports on the effectiveness and efficiency of internal processes and the level of
compliance with internal policies and procedures, and also laws, rules, and regulations. Per
Yellow Book standards, the Auditor puts emphasis and resources into the areas of risk that are
either perceived or demonstrated. Open and effective communication ensures that the appropriate
managers, governance authorities, and ultimately the citizens of Boise are kept informed of audit -
related activities and findings.
INDEPENDENCE The Auditor is appointed by and reports to the six -member City Council. The
mayor's input is requested on the hire. The Auditor has supervisory authority for its own staff and
creates the annual work plan that is adopted by the city council and mayor. City Code states no
person may unduly influence or undermine the independence of the auditor in the performance of
the duties and responsibilities.
ACCESS TO INFORMATION All City employees are required as a condition of employment to
cooperate fully and truthfully with the Office of Internal Audit by providing any information,
evidence, interviews, or other materials. By code, the Auditor has complete access to any and all
records including all electronic data or information maintained by the City of Boise and allowed
by law. It is unlawful for any person to intimidate, influence, impede, deter, threaten, harass,
obstruct or prevent, another person from freely, fully and truthfully cooperating with the
Auditor's Office.
ACCOUNTABILITY The Auditor reports all findings to the City Council and Mayor, as well as
provides quarterly activity reports. The Auditor can be dismissed for cause by a supermajority (5
of 6) of the City Council.
FUNDING The City Council sets the budget for the Auditor's office.
OTHER UNIQUE PROVISIONS Boise's auditor has a fiduciary duty to the public, per the city
code.
Centennial City, Colorado
Population is 110,000 City Budget is $86 million City Manager has executive authority
Contracted performance auditor works within a $296,000 budget
Centennial City, Colorado does not have any employees assigned to performance auditing.
Uniquely, it conducts all performance audits by contract as directed by an eight -member Audit
Committee.
DUTIES OF AUDITOR The duties are determined in each contract for an audit.
INDEPENDENCE An Audit Committee approves audit topics and directs the contracted
performance auditing process for Centennial City. The Audit Committee oversees the annual
financial audit required by City Charter in addition to other audit(s) that the City Council may
request pursuant to the authority in the Charter.
ACCESS TO INFORMATION Access is established in the contract for the audit.
ACCOUNTABILITY Performance standards are set in each contract. The Audit Committee
provides oversight and reviews audit findings prior to presenting them to the City Council. The
Audit Committee us comprised of the Mayor, one council member appointed by the City Council,
the City Manager, Finance Director, a staff member appointed by the Finance Director, the City
Attorney, and two city residents with relevant business experience appointed by the City Council.
FUNDING The City Council approves the audit budget.
OTHER UNIQUE PROVISIONS The usefulness of this model is limited, as $260,000 of the
city's $296,000 audit budget is directed to sales tax audits, which is not a significant source of
revenue for Eugene.
Denver, Colorado
Population is 700,000 City Budget is $1.2 billion Mayor has executive authority
Elected Auditor has 51 performance audit staff and a $4.5 million budget
Denver is a merger of both city and county governments. While the mayor has executive authority, 13
elected City Councilors pass ordinances, approve the budget and can take whistleblower
complaints. Denver's budget includes the Denver Airport as well as Denver Water.
DUTIES OF AUDITOR While an elected auditor has been part of Denver for decades, charter
amendments in 2005 shifted former payroll and financial management functions to an Office of
Controller. The auditor's new role included performance, financial and IT audits, as well as assurance that
all contracts with Denver pay prevailing wages for employees. The auditor can receive whistle -blower
complaints. The Denver Audit Office characterizes its work as "integrated" auditing. The auditor's office
states that with proper planning, their work annually covers all aspects of the city.
INDEPENDENCE The charter states no ordinance passed by the city council may compromise the
independence of the auditor. Although Denver's web site says the city attorney provides counsel to the
auditor, the auditor can also hire independent legal counsel. One of the current auditor's five appointees is
an attorney who provides internal legal counsel to the office. The office does its own HR.
ACCESS TO INFORMATION The charter assures access to city records, personnel, and all contracts.
The auditor countersigns all of Denver's contracts ensuring access language in those contracts.
ACCOUNTABILITY Denver follows Generally Accepted Government Accounting Standards. The charter
requires a seven -member audit committee that is chaired by the auditor; the other six members cannot be
government employees. The mayor, city council and the auditor each appoint two members to the audit
committee. The committee receives audit reports and the members report back to the entity that appointed
them to their four-year terms. All reports are public and are posted on the web. Each year, the audit
committee commissions an external financial audit of Denver's finances.
FUNDING The charter amendments require Denver's council to ensure sufficient funding for the auditor's
office to perform its powers and duties. Denver's council funds the auditor's office as a balance to the
power of the mayor. In the last years of the previous auditor, the office's salaries were not kept apace so
the recent budget under the new auditor grew by almost $1 million to sufficiently raise salaries.
OTHER UNIQUE PROVISIONS Denver's follow-up audits result in strong implementation of the
recommendations that are agreed to by the audited entity. Each report sets a follow-up date 9-24 months
later. Denver says this practice gives assurance of continuous quality improvement activities and that the
audited agencies are finding the audit recommendations relevant, feasible and worthwhile. Denver's audit
office says it does not visit the same issue twice. By charter, an auditor may only serve three four-year
terms. The elections when there is no incumbent are contested, but incumbents have not been opposed.
Denver's court system (not the Colorado state courts) is currently in a legal dispute with the auditor about
whether his office has the authority to audit the court's governance structure and examine the court's
processes including administration and collection of fines and penalties.
Eugene, Oregon (Proposed Ballot Measure)
Population is 167,000 City Budget is $676 million City Manager has executive authority
Elected Auditor has about 3 performance audit staff and a $670,000 budget
The group called City Accountability has proposed charter amendments to establish an Office of
the Independent Auditor for the City of Eugene. The elected auditor will provide objective,
timely and accurate information about city operations to promote improved decision-making,
service delivery and cost savings, as well as improve transparency and accountability to the public
for city operations.
DUTIES OF AUDITOR By charter, the auditor conducts financial, compliance, performance,
special studies or other audits of all aspects of the city's government operations. The auditor also
oversees any audits contracted for and funded by the city. By charter, the auditor maintains a
website with audits and reports and establishes a whistleblower hotline.
INDEPENDENCE The auditor is non-partisan, serves a four-year term and is responsible to the
voters. The auditor supervises all staff in the auditor office and can secure independent legal
counsel or the help of other professionals. The auditor prepares a work plan and seeks review and
comment, but not approval, from the public, the City Council and the City Manager.
ACCESS TO INFORMATION By charter, the auditor has access to all records, personnel and
contracts. All city contracts will include a "right to audit" clause. By charter, the auditor may
subpoena records, if necessary.
ACCOUNTABILITY To run for office, the auditor must be certified and have five years of recent
experience. The auditor may be recalled. The auditor will follow Generally Accepted
Government Accounting Standards. All reports and audits will be posted publicly. Nothing in
the charter amendments prohibit an audit committee, but none is required and no protocol is set
for the committee's selection. The auditor is not subject to the attendance requirements of the
Mayor and Council. The auditor need not be a city resident before or during her tenure, unlike
the Mayor, Councilors, and City Manager.
FUNDING The auditor prepares a budget for the office that is not less than 0.1 % of Eugene's
total annual budget. The proposed charter amendments also set the auditor's compensation (not
less than 70% of the average of the salaries of the Eugene city manager, Salem city manager and
EWEB general manager) and benefits.
OTHER UNIQUE PROVISIONS The auditor will follow up to determine if corrective action by
audited entities was taken. The proposal does not specifically state that EWEB is subject to the
auditor's jurisdiction, but it implies so through language giving supremacy to the petition
language over any other provision of the Charter. The auditor shall be provided time on City
Council agenda whenever requested by auditor.
Eugene, Oregon (2002 Citizen Charter Review Committee)
Population is 167,000 City Budget is $676 million City Manager has executive authority
Appointed Auditor has no audit staff and a probable budget of $150,000
The 2002 Eugene Charter Review Committee recommended a charter amendment to establish a
City Council -appointed performance auditor. The committee felt that a single auditor would be
sufficient, pursuant to a recommendation by then -Portland City Auditor Gary Blackmer.
DUTIES OF AUDITOR By charter, the auditor would conduct or contract audits intended to
measure or improve city functions following generally accepted government auditing standards.
INDEPENDENCE The committee wanted to ensure both independence and accountability.
Independence was to be ensured by having the auditor report to the City Council, rather than the
City Manager. The auditor would have a work plan based on GAGAS, reviewed and approved by
an audit committee. The audit committee composition to be "the city manager and other
members as defined by the ordinance" in the charter language. Other language in the
recommendation specified that the composition should be the Mayor, 3 City Councilors, 2 City
Budget Committee lay members, and the City Manager.
ACCESS TO INFORMATION The proposal was somewhat oblique, but specified in its
comments (but not the charter language) that one of the duties of the audit committee was to
mediate between the audited entities and the auditor.
ACCOUNTABILITY The auditor was to be an at -will employee of the Council, which could
remove the auditor with or without cause. Candidates would be required hold a certification as a
CPA, CIA, CMA, or "relevant certification" throughout their tenure. The auditor will follow
Generally Accepted Government Accounting Standards. All reports and audits will be posted
publicly.
FUNDING The proposal did not specify a particular budget or minimum salary. Taking the
County auditor as an exemplar of the costs of operating a small office, a figure of $150,000 is an
approximation of the cost. The Council would determine the budget, which might be greater if
that year's audit plan included a number of contracted audits.
OTHER UNIQUE PROVISIONS The audit committee would review candidates for the auditor
position and forward them to the City Council.
Lane County, Oregon
Population is 363,000 Budget is $600 million County Administrator has executive authority
Appointed Auditor has 1.25 performance audit staff and a $170,000 budget
Operating under a home rule charter, Lane County has a five -member Board of County
Commissioners, who are elected from five districts.
DUTIES OF AUDITOR The auditor is authorized by county code to conduct performance audits
for all departments, offices, activities, and programs under the control of the County, including
operational, compliance, and information systems. Additionally, the auditor is authorized to
perform special reviews and investigate allegations of misuse of county assets or resources.
INDEPENDENCE The auditor reports directly to the Board of County Commissioners and is
hired and dismissed by the Board. Thus, the auditor does not report to the County Administrator
or other management personnel. A board -appointed audit committee advises the Commissioners
on hiring and dismissal. After input from the audit committee, the auditor must seek approval
from the Board of County Commissioners on the annual audit plan, instead of having the
authority to decide which audits to perform.
ACCESS TO INFORMATION Lane County's code guarantees access to personnel, records and
contracts.
ACCOUNTABILITY An audit committee advises the Board of County Commissioners on
significant audit matters and provides oversight over the auditor and auditor's office. The audit
committee ensures that the auditor is maintaining independence and objectivity, following
government auditing standards, and conducting audits and issuing reports. The County
Commissioners appoint the five voting members to the audit committee: four at -large citizen
members and one Commissioner. Five ex -officio non-voting members (held by county
management) also serve on the committee. The auditor must have a bachelor's degree in public
policy, public administration, accounting, business administration, economics or a related field
and five years of progressively responsible related experience.
FUNDING The requested budget is reviewed by the audit committee, and the committee advises
the Board of County Commissioners on the requested budget. Unstable funding historically
created significant gaps in staffing Lane County's auditor office.
OTHER UNIQUE PROVISIONS Lane County's structure follows an internal auditor structure
that allows the auditor to be part of the team, which may increase the ability of the auditor to
build trust and relationships with staff and management in the programs and departments under
audit. Lane County's recently retired auditor noted that trust and relationship -building can be very
important. Not only does it help the auditor conduct valuable performance audits that provide
useful information and conclusions about a program but also relevant and appropriate
recommendations.
Long Beach, California
Population is 470,000 City Budget is $2.4 billion City Manager has executive authority
The elected auditor the department has 17 support staffers, and has a $3 million budget
Long Beach has a Council -Manager structure similar to Eugene. There are nine councilors, who
have the authority to appoint the City Manager and the City Clerk, and are responsible for budget
approval. The city budget includes the airport, the harbor, and water, gas, and oil services.
DUTIES OF AUDITOR The Long Beach auditor's office has been around since 1908, and
performs a wide variety of duties. On the financial side these include overseeing the
Comprehensive Annual Financial Report, performing quarterly treasury audits, a review of all
city disbursements (every check must be signed in the auditor's office), and processing wage
garnishments. While these are the only duties prescribed explicitly by the charter, other audits are
not prohibited and in practice the office also does performance audits of departments as the
auditor deems fit, and maintains several performance auditors on staff. An annual work plan
guides the process, with direction from City Council. The office also maintains a fraud hotline. In
2016 the office performed a total of 14 audits.
INDEPENDENCE The auditor has full authority to appoint all employees within the auditor's
office, and such appointees serve at the pleasure of the City Auditor. Since the auditor is elected
by a city-wide vote, neither Council, the Mayor, or the City Manager have any authority over the
staffing of the auditor's office at any level. In 1979 a charter amendment was proposed that would
have restricted the auditor to financial audits only, prohibiting performance audits, but the council
unanimously voted to reject the amendment in the interest of maintaining independence for the
office.
ACCESS TO INFORMATION The charter specifies that "The City Auditor shall have the right
of immediate access to all financial records of the City."
ACCOUNTABILITY Long Beach follows generally accepted government accounting standards,
and the auditor is subject to a triennial peer review. In order to be eligible to run for the office of
auditor, the candidate must be a licensed CPA in the state of California, and must have held that
certification for a minimum of five years. The charter requires audit reports to be filed with the
City Clerk when completed, and reports are also posted publicly online, as is the annual audit
plan, and an annual summary of the prior year's audit results.
FUNDING The City Council is in charge of approving a budget, with the City Manager obligated
to propose one for their approval. There are no explicit charter -defined minimums for the
auditor's budget that must be adhered to.
OTHER UNIQUE PROVISIONS The City Auditor is not term limited, even though City
Councilors and the Mayor are limited to two terms each. Myrtelle Gunsul served as auditor from
1919 until her retirement in 1951, and is the longest serving elected official in the city's history.
Long tenures have been common, with Ms. Gunsul being the first of only six auditors to hold the
office in the last 98 years (since her first election).
Oakland, California
Population is 420,000 City Budget is $1.3 billion The Mayor has executive authority
Elected Auditor has 10 perfonnance auditors and two administrative staff and a $1.9 million
budget
Oakland's residents elect the City Auditor every four years.
DUTIES OF AUDITOR In addition to performance audits, the Auditor reports fraud, waste,
retaliations and complaints as well as "kickbacks." If any wrongdoing becomes a criminal act, the
matter is then referred to the Office of District Attorney. All other evidence of wrongdoing may
follow the City's personnel directives or other standards for discipline. The Auditor's style is one
of "collaborative change agent." Oakland's Auditor Office believes this style of leadership is
preferred because it eliminates walls and encourages transparency.
INDEPENDENCE No one within Oakland's administration can influence what is reviewed or
audited. The City Charter gives the office the authority to audit "anything" in Oakland's City
government. The City Auditor works for all Oakland's residents and does not work for any other
division or departments.
ACCESS TO INFORMATION The City Charter provides full access.
ACCOUNTABILITY Eight of the ten audit staff (including the elected auditor) are certified
auditors. All audits are performed according to the Generally Accepted Government Auditing
Standards (GAGAS). Audits are shared with the administration that is kept informed every step of
the process in order to clarify and provide assistance when recommendation/s are submitted.
FUNDING The Mayor proposes a budget and the City Council decides collaboratively with its
Lay Budget Committee Members. The Office of the City Auditor states it is currently staffed at
50% of a required level for a city of Oakland's size. The auditor's budget is 0.15% of the total
city budget.
OTHER UNIQUE PROVISIONS The Office of the Auditor consistently performs follow-up to
ensure compliance with recommendations. Unpaid Master Fellows students and the assistance of
college interns are assets to the Audit Office.
Orlando, Florida
Population is 277,000 City Budget is $1.2 billion Mayor has executive authority
External auditors are appointed; internal auditor is a city employee with 5 staff. Has a $746,000
budget.
Orlando's audit program, the Office of Audit Services and Management Support, is a combination
of in-house and external auditing.
DUTIES OF AUDITOR Orlando's internal auditor supervises a staff of five and coordinates the
city's audits. The auditor performs independent, objective assurance and advisory activities
designed to add value and improve the City's operations. The auditor also operates a fraud, waste
and abuse hotline.
INDEPENDENCE The auditor determines the audit topics as approved by the audit board that is
appointed by the mayor.
ACCESS TO INFORMATION City ordinance provides access for the internal audits that are
conducted. Contractors have access as specified in contract.
ACCOUNTABILITY Orlando states that it follows generally accepted government accounting
standards. The mayor appoints the audit board comprised of five community members. The audit
board oversees the financial and other reporting practices and safeguards the independence of the
audit process.
FUNDING The City Council approves the auditor's budget.
OTHER UNIQUE PROVISIONS The majority of audits are for a unique program called a
Municipal Public Services Tax Audit that charges taxes based on the use of certain utilities.
Phoenix, Arizona
Population: 1,615,000 City Budget: $1.278 billion City Manager has executive authority
The appointed auditor has 24 performance audit staff plus support staff and a $2.85 million budget.
Phoenix, a large city, has a strong city manager form of government. The City Auditor position has existed
since at least 1914, but Phoenix's administrative structure and the duties of the Auditor have evolved.
Voters adopted the current strong City Manager structure in 1948, in large part to insulate city staff from
political favoritism and partisan politics.
DUTIES OF AUDITOR The charter provides that the Auditor shall prescribe "the use of plain and
uniform systems of keeping books of accounts." City code expands the Auditor's role to include the
authority to carry out performance audits in addition to financial, internal control and contract compliance.
INDEPENDENCE The Auditor, appointed and supervised by the City Manager, is an at -will employee.
The Auditor has hiring and supervisory authority for all auditing staff. An annual work plan, based on a
risk assessment, is considered, modified and then approved by a nine -member Audit Committee.
ACCESS TO INFORMATION The Phoenix Charter provides the Auditor "shall at all times have access to
and may inspect" all financial records of the City. City Code also prohibits any city employee from
interfering with "the initiation, scope, timing or completion" of an audit, and guarantees the Auditor's right
to access records, documents, whether hard -copy or electronic, relating to the department, office or
program being audited. All contracts include an auditor access provision.
ACCOUNTABILITY Auditor follows generally accepted government accountability standards. The Audit
Committee consists of three City Councilors and three public members, all appointed by the Mayor, plus
three members of City Staff: the City Manager, the Finance Department Director and the Budget &
Research Department Director. In FY 2016-17, the Auditor and audit staff completed 82 audits.
FUNDING The budget is set through the normal budgeting process: Auditor proposes, City Mgr. reviews,
then Budget Committee, and then final approval by City Council. FY 2017-18 budget is $2.85 million;
Auditor currently has authorization for 24 performance audit staff, plus support staff
OTHER UNIQUE PROVISIONS Auditor keeps 15% of staff capacity reserved for high priority audit
activity that emerges during the year. The Auditor oversees a hearing officer who handles seized property,
false alarm and loud party penalties. Auditor also oversees a whistle -blower "Integrity Line" program,
open to City employees, residents and contractors, that accepts complaints of fraud, waste and abuse by
City employees and contractors. In FY 2016-17, 92 complaints were resolved, 17 of which were proven.
The current City Auditor was appointed in April of this year, but previously served as the Auditor for
Maricopa County (which includes Phoenix) for 22 years. At the County, he once had to obtain outside
counsel in order to pressure Sheriff Joe Arpaio to provide access to documents needed for an audit. The
previous City Auditor had been in that position for many years and had served on the City's audit staff
since 1989. Both the current and former City Auditors are former Presidents of the Association of Local
Government Auditors (ALGA).
Portland, Oregon
Population is 640,000 City Budget is $4.7 billion City Commissioners have executive authority
Elected Auditor has 11 performance auditors (50 overall in the office) The Audit Division budget is about
$2,086,000 in addition to $480,000 for an outside audit of finances.
Portland has a unique governance structure. The mayor and four non-partisan "commissioners" are elected
at -large to four-year terms. The mayor assigns each commissioner and him/herself to be the administrator
of a city bureau and may change these assignments at any time. City Commissioners are responsible for
enacting and enforcing city ordinances, and they are salaried.
DUTIES OF AUDITOR In 1868, Portland voters established the Office of City Auditor, the Auditor who
was independently elected to a four-year term. With passage of charter amendments, the latest in 2017, the
Auditor now supervises and may conduct performance audits on all city entities and their use of public
resources. The expanded auditor's responsibilities include eight divisions: audit services, performance and
financial, city ombudsman, independent police review, elections, city archives and records, council clerk,
and lobbyist registration.
INDEPENDENCE The auditor selects what to audit with input from the public. To encourage and support
Management, the auditor provides a draft of the audit report and draft recommendations. If there are major
issues, the auditor takes them into consideration. The auditor does not want to take on the role of
management, so recommendations are broad and flexible allowing department management to determine
how to meet the goals. The Portland Auditor retains independent legal counsel and is in charge of its own
procurements and human resources.
ACCESS TO INFORMATION Access to information is found in the city charter: the auditor "shall have
timely access to all employees, information and records required to conduct an audit or otherwise perform
audit duties, including confidential and legally privileged information and records so long as privilege is
not waived as to third parties." The city code has similar provisions which may be amended to conform
with legislative action in 2017.
ACCOUNTABILITY Candidates for Auditor must have a CPA or Certified Internal Auditor to qualify to
run for the position. In the past 25-30 years, five different individuals have served as auditor. The Auditor
states they run on a "no surprises" basis. The current Auditor requests volunteers to serve as her "sounding
board" which is not required. The 2017 Charter amendments require the Auditor's Office to have adequate
internal controls, comply with all applicable laws, operate efficiently, and periodically undergo reviews by
outside entities.
FUNDING The auditor must submit and gain approval from the City Council of its annual budget, but it
does not have to seek review by the city's budget office. This may provide some checks and balances to
the extensive authority of the auditor. The auditor would like more control over the budget. Some
observers question that the auditor is elected but appears in the Portland Budget document along with other
bureaus.
OTHER UNIQUE PROVISIONS To place an issue on the ballot, the auditor may collect adequate
signatures to qualify. The City Commissioners at the Auditor's request placed the 2017 Charter Changes
on the ballot.
EUGENE CITY COUNCIL
AGENDA ITEM SUMMARY
N
Public Hearing: An Ordinance Concerning Fireworks Restrictions and Amending
Sections 4.934 and 4.996 of the Eugene Code, 1971
Meeting Date: November 20, 2017 Agenda Item Number: 1
Department: Fire Staff Contact: Fire Chief Joe Zaludek
www.eugene-orgov Contact Telephone Number: 541-682-7115
ISSUE STATEMENT
The City Council will hold a public hearing on an ordinance concerning fireworks restrictions.
BACKGROUND
Over the past few years, Council has considered a complete ban of fireworks with exceptions for
professional event displays and within designated locations in Eugene. The efforts since 2014 have
been to focus on education and enforcement. Impacts from the pervasive use of fireworks include
the risk of injuries and property damages from fires, and the noise generated from them disrupts
the quality of life for military veterans, senior citizens, animals, refugees, and community members
at -large.
Following their discussion at the work session on October 25, 2017, the council directed staff to
schedule a public hearing on an ordinance that limits all consumer fireworks citywide to those that
do not bang, whistle, or screech in a manner that is audible from 50 feet. The ordinance as written
limits the days such described quieter consumer fireworks can be used to December 31, January 1,
July 3 and 4, and limits the days for use of display fireworks to July 3-5.
COUNCIL OPTIONS
No options are presented at this time; this is a public hearing only.
ATTACHMENTS
A. Proposed Ordinance Concerning Fireworks Restrictions
FOR MORE INFORMATION
Staff Contact: Fire Chief Joseph Zaludek
Telephone: 541-682-7115
Staff E -Mail: joe.s.zaludekPci.eugene.or.us
November 20, 2017, Meeting — Item 1
ATTACHMENT A
ORDINANCE NO.
AN ORDINANCE CONCERNING FIREWORKS RESTRICTIONS AND
AMENDING SECTIONS 4.934 AND 4.996 OF THE EUGENE CODE, 1971.
THE CITY OF EUGENE DOES ORDAIN AS FOLLOWS:
Section 1. Section 4.934 of the Eugene Code, 1971, is amended to provide as follows:
4.934 Fireworks Restrictions. In addition to restrictions on the sale, possession, use,
detonation or explosion of fireworks under state law, it is unlawful to:
(1) [u}Use, light, detonate or display any consumer fireworks anywhere in the city
at any time except on December 31, January 1, July 3 or July 4 [jURe 23
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(2) Use, light, detonate or display on December 31, January 1, July 3 or July
4 any consumer fireworks that produce audible effects, such as bangs,
whistles or screeches, that are plainly audible fifty feet or more from the
consumer fireworks.
(3) Use, light, detonate or display any display fireworks anywhere in the city
at any time except July 3 through July 5, unless specifically authorized
by the city manager or designee.
For the purposes of this section, "consumer fireworks" and "display fireworks"
have the meanings given in ORS 480.111.
Section 2. Subsection (8) of Section 4.996 of the Eugene Code, 1971, is added to provide
as follows:
4.996 Administrative Civil Penalty.
(8) In addition to, and not in lieu of any other enforcement mechanism
authorized by this code the city manager or designee may impose upon
the person responsible for violation of section 4.934 of this code, an
administrative civil penalty as provided by section 2.018 of this code.
Section 3. The City Recorder, at the request of, or with the consent of the City Attorney, is
authorized to administratively correct any reference errors contained herein, or in other provisions
of the Eugene Code, 1971, to the provisions added, amended or repealed herein.
Passed by the City Council this
day of 120117
City Recorder
Approved by the Mayor this
day of , 2017
Mayor
Ordinance - Page 1 of 1 November 20, 2017, Meeting -Item 1