San Diego Audit Committee Meeting Summary - June 11, 2025
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San Diego Audit Committee Meeting Summary - June 11, 2025
The Audit Committee of the San Diego City Council met on June 11, 2025, at approximately 9:00 AM. The meeting was televised and live-streamed, with virtual participation options for the public. The committee reviewed performance audits of the city's trash recycling and organics collection and handling, and fire-rescue overtime. The committee also received the city auditor's monthly activity report. Key topics included franchise fee under-collection, diversion rate accountability, and fire-rescue overtime budgeting and staffing projections.
Consent Calendar
- Item 1: Approval of the committee minutes of April 23, 2025 – Approved unanimously.
- Item 2: Authorization to extend the contract for external audit services – Approved unanimously. The contract extension was noted as not increasing costs.
Public Comments & Testimony
- Non-Agenda Public Comment: Joyce Sanyata (District 3) expressed concern about underrepresentation in city contracts and requested audits to address the issue. Terry Ann Skelly, a community volunteer, raised concerns about the costs of marijuana businesses to first responders and public health. DRA (name not given) demanded an emergency audit of Tent City and Dreams for Change, citing three recent deaths and sexual assaults. Blair Beekman commented on the need for more community dialogue on trash issues and the city budget. Judy Strang requested better visibility of the fraud hotline and expressed concerns about marijuana businesses. Marco Espinoza supported restrictions on marketing marijuana to youth.
- Consent Agenda Public Comment: Joyce Sanyata spoke in favor of item 2, noting the contract's staffing mix. DRA criticized the meeting minutes for omitting descriptive words and the delay in the audit contract extension.
- Item 4 Public Comment: Jim Madaffer, Executive Director of the San Diego County Disposal Association, argued the audit was based on outdated data (2023), misunderstood the hauler-customer relationship, and recommended shelving the report. He stated that franchise fees plus AB 939 fees make San Diego customers pay some of the highest rates in the state. Joyce Sanyata thanked the environmental services department and supported the fee study. DRA accused the city of robbing residents through trash fees. Blair Beekman requested clearer communication on rate impacts.
- Item 3 Public Comment: Joyce Sanyata praised the fire-rescue department and supported the six recommendations. DRA attributed vacancies to COVID-19 vaccine mandates. Kathleen Lippett questioned how the department could underestimate attrition and vacancies. Blair Beekman referenced Oakland and San Jose studies on police/fire overtime.
- Item 5 Public Comment: Joyce Sanyata supported audits of cybersecurity, performance monitoring, unsafe camping ordinance, and SDPD internal affairs. DRA again demanded an emergency audit of Tent City. Blair Beekman commented on cybersecurity and electronic billboards. Kathleen Lippett raised concerns about councilmember Whitburn's intervention in a LAFCO appointment.
Discussion Items
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Item 4: Performance Audit of the City's Trash Recycling and Organics Collection and Handling
- The city auditor, Andy Hino, presented findings: The city could recover at least $4 million more per year and up to $15 million more per year by increasing hauler fees. The franchise fee has only increased 13% since 2010 while CPI increased 54%. The city's recycling rate has stagnated at around 67% since 2010. The audit found that the city can do more to hold itself and private waste haulers accountable to meet Climate Action Plan targets. ESD agreed to all eight recommendations.
- Senior Deputy City Attorney Nicole Dino explained that a recent court decision (Zali v. City of Oakland) limits the inclusion of street damage costs in franchise fee calculations, but the decision is subject to appeal. A franchise fee study is recommended to support any fee adjustments.
- Chair Moreno expressed disappointment that ESD had not prioritized a fee study earlier. She noted that the city has a structural deficit and must recover costs. Committee member Halpern questioned the length of time (three years) for the fee study and suggested that the city might implement a CPI-based increase sooner. The IBA recommended basing franchise fees on gross receipts rather than tonnage.
- Key vote: Motion to accept the report, forward it to City Council, and close recommendation 1.1 (as no longer applicable due to the court decision) passed unanimously (with committee members Mafia and Tapsuri absent).
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Item 3: Performance Audit of Fire-Rescue Overtime
- The city auditor presented findings: Fire-rescue overspent its overtime budget by $71.6 million from FY 2019 to FY 2024, with $31.8 million impacting the general fund. Overtime hours decreased by 30% over the period, but costs rose due to underbudgeting for vacancies and leave. The department overestimated staffing and underestimated leave. The audit made six recommendations to improve budgeting and staffing projections, all agreed to by fire-rescue and the Department of Finance.
- Deputy Director Michelle Yamamoto and Assistant Chief James Gabriel confirmed steps to limit non-essential overtime and formalize budgeting methodology. The committee discussed the need for accurate academy projections: the auditor found that three academies per year would be needed to reach full staffing in two years, while the department projected two academies would suffice by FY 2027.
- Key vote: Motion to accept the report passed unanimously (with committee members Mafia and Tapsuri absent).
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Item 5: City Auditor's Monthly Activity Report
- Andy Hino reported that the office had issued 15 reports in FY 2025, with 70 recommendations. Seven audits are in progress, including audits of the Pure Water project, disaster preparedness, cybersecurity, and citywide performance monitoring. The office received over 100 audit requests from the public and stakeholders. The audit committee took no action as this was an informational item.
Key Outcomes
- Consent Agenda (Items 1 & 2): Approved unanimously.
- Item 4 (Trash Audit): Report accepted and forwarded to City Council; recommendation 1.1 closed as no longer applicable. ESD to conduct a franchise fee study and consider alternative fee models.
- Item 3 (Fire-Rescue Overtime): Report accepted; fire-rescue to implement six recommendations, including formalizing overtime budgeting methodology and updating the relief factor calculation.
- Item 5 (Auditor's Report): Received as information.
- IBA Update: The reappointments of public members Mafia and Halpern were finalized; a recruitment for Tapsuri's vacant seat is ongoing.
- Next Meeting: Scheduled for July 2, 2025, at 9:00 AM.
Meeting Transcript
Good morning and welcome to the audit committee meeting of June 11th, 2025. Um, our committee liaison, Natalie Kessler will go over instructions for today's meeting. Thank you, Chair. While members of the public are able to attend the meetings in person, this meeting is being televised and live streamed on the city's website, and the council administration will continue to make arrangements for the public to comment using the Zoom webinar platform. Members of the public who wish to provide virtual testimony must enter the virtual queue by raising their hand before the queue closes. The queue will close when the last virtual speaker finishes speaking or five minutes after in-person testimony ends, whichever occurs first. This will allow for better meeting management between the two platforms and ensure the committee is able to manage and conduct city business. We appreciate the public's cooperation. Chair. Thank you. I will now call the audit committee meeting of June 11th, 2025 to order. Natalie, please call the roll. Vice Chair Whitburn. Sure. Committee member Halpern. Committee member Mafia. Committee member Tapshuri. Present. And Chair, Committee Member Moreno. Present. Committee member Tap Shuri, can you please provide your virtual declaration? Yes. I'm notifying the audit committee and the public that I will be attending the meeting today remotely due to just calls related to official duties. Pursuant to the Brown Act, I'm disclosing that there are no individuals 18 years of age or older present in the room with me. I will update this disclosure if it changes during the course of the meeting. And uh one more thing. I unfortunately will not be able to stay on the entire meeting. I might have to leave around 10. Thank you. Thank you. Chair. Thank you. Also attending the meeting is our city auditor, Andy Hanao, Christina Gogger, Chief Compliance Officer. Aaron Noel with the IBA's office. Kevin Smith, our committee liaison consultant, sorry, and uh Natalie Kessler, our committee liaison. Natalie, please continue with public comment. If you are in person, please complete a speaker slip located at the entrance of the committee room and place it in the box indicated near the speaker's lectern at the front of the room. Please do so in a timely manner to ensure proper meeting management. In-person testimony will conclude before virtual testimony begins. Members of the public can join the webinar by computer, tablet, or smartphone by accessing the link, which is listed online in the preamble language of the agenda on the city's webpage. If you need to participate by phone, please dial 1669 2545252. The webinar ID is 1600 three three seven four two two pound. This information is also available on the agenda and will appear on the screen during the public comment period for each agenda item. Members of the public who wish to provide virtual testimony must enter the virtual queue by raising their hand before the virtual queue closes and the queue will close when the last virtual speaker finishes speaking or five minutes after in-person testimony ends, whichever occurs first. Note that if you're watching via City TV 24 or online, there may be a delay. Please participate via the audio on your phone and mute your TV or computer when it is your turn to speak. And if you wish to speak on our on a particular item, wait for that item to be called and then raise your hand to speak by tapping the raise your hand icon. Or if you are a call and participant, press star nine on your phone. If you raise your hand during a non-comment period, your hand will be lowered. Chair.
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