Budget and Audit Committee Special Meeting – April 3, 2018
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Budget and Audit Committee Special Meeting – April 3, 2018
The Budget and Audit Committee of the Sacramento City Council held a special meeting on April 3, 2018, at 1:00 PM in the City Hall Council Chamber. The committee unanimously approved the consent calendar and discussed a follow-up report from the City Auditor, highlighting the successful implementation of the utilities billing audit that resulted in $12.3 million in additional revenue collected and an estimated $6.6 million in ongoing annual revenue.
Consent Calendar
- Approved the Budget and Audit Committee Meeting Minutes for December 5, 2017, January 16, 2018, January 30, 2018, and February 6, 2018.
- Accepted and forwarded to the City Council the Fiscal Year 2016/17 Child Development Program Audit.
- Accepted and forwarded to the City Council the Fiscal Year 2016/17 Transportation Development Act Fund Audited Financial Statements and Compliance Report.
- Accepted and forwarded to the City Council the Fiscal Year 2016/17 Single Audit Report.
- Accepted and forwarded to the City Council the City Auditor’s Activity Report for the 2nd Quarter of Fiscal Year 2017/18.
Discussion Items
- City Auditor’s Recommendation Follow-Up Report for the Six-Month Period Ending December 31, 2017 – City Auditor Jorge Oseguera presented the report. Key highlights included:
- The successful closure of the utilities billing audit, with all 14,641 parcels evaluated. Of those, 7,567 parcels now being billed for one or more city utility services that were previously unbilled.
- Since the audit’s release, the Department of Utilities has billed more than $13.7 million in additional net revenue and collected approximately $12.3 million.
- The department projects an additional $6.6 million annually in ongoing revenue from these changes.
- Committee members (Mayor Steinberg, Councilmember Schenirer, Councilmember Ashby) asked about verification processes, the role of the Finance Department, and the impact on the General Fund. It was noted that approximately 11% of the revenue (about $600,000 annually) accrues to the General Fund, and the Finance Department has reviewed the numbers. The interim Finance Director confirmed that the numbers will be reflected in the upcoming 2018 budget deliberations.
- The committee requested that a footnote be included in the budget to credit the Auditor’s office for this work and to track the ongoing revenue.
Key Outcomes
- Motion passed (4-0) to accept the City Auditor’s Recommendation Follow-Up Report for the July 1, 2017 to December 31, 2017 period and forward it to the City Council for final approval. (Moved by Councilmember Schenirer, seconded by Councilmember Jennings; all members present voted yes.)
- The committee also approved the entire consent calendar by a single unanimous motion.
- No additional public comments or committee comments were made. The meeting adjourned at 1:15 PM.
Meeting Transcript
Oh, there's Councilmember Ashby coming right now. Okay, good afternoon. Uh everyone. I'm speaking slowly. The City Council's budgeted and audit committee will come to order. Let's call the roll, please, and establish a quorum. Councilmember Jennings. Councilmember Shaneer. Councilmember Ashby. And Mayor Steinberg. Here. All right, thank you. We have a what I hope will be a relatively brief agenda. We begin. Are there any public comments on items not on the agenda? I have no speaker slips. No speaker slips. Okay, then we have the consent calendar. Are there any moved by Councilmember Schneer? Second by Councilmember Jennings. Any questions on the consent calendar by any of the members? If not, all in favor, please say aye. Aye. Opposed abstain. Very good. We have one discussion item. It's item six, and that is the city auditors' recommendation follow-up report for the six-month period ending December the 31st of 2017. Welcome. Thank you. Afternoon, Mayor and members of the budget and audit committee, Jorge Squera, your city auditor. The recommendation that is before you is that you accept the city auditor's recommendation follow-up report for the period ending. Starting July uh 1st, 2017 and ending December 31st, 2017. And forwarding to the city council for final final approval. I will be brief on my presentation given our pending schedule. A couple things that I just wanted to highlight during this recommendation follow-up uh report is that we we do have some uh reports that have been outstanding for some time that uh I think we need to have some added attention to in order to um expedite the implementation of some of these recommendations. Uh some of the ones that I'd like to focus on for this next recommendation follow-up period are the city's uh wireless communications audit, which still has uh 11 under the partly implemented category, the purchase card audit, as well as the city's policies and procedures uh assessment. One of the things that we like to highlight in these reports are the potential city benefit that we've identified through our audits and the estimated realized benefit. And we uh disclose both of those numbers in these reports uh every time that we do these these audits. The realized benefit is money that we have confirmed that the city has been able to uh benefit from. So that's real money that we uh can count on. Um of the things that I wanted to highlight in this and why I wanted to do a discussion item is that we have completed our implementation on our audit of the utilities billing. Uh and blow it up a little more. And uh we have some very good news to report out as a result of this particular engagement. Of the 14,641 parcels identified in the audit, all 100% of those parcels have been evaluated. As a result of that process, um a total of 7,567 parcels have been set up and are being billed for one or more city utility services, which previously had not been billed for. So this is new money that is coming into the city that we otherwise wouldn't have received were it not for this effort that the utilities department has gone through. So since the release of the audit, the the Department of Utilities has billed more than 13.7 million in additional net revenue. Of this, the department has collected approximately 12.3 million dollars. Additionally, the department projects an estimated 6.6 million annually in additional revenue due to the implementation of these audit recommendations. This is very positive news.
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