Audit Committee Meeting - October 7, 2026: Follow-up Report and Discussion on Open Recommendations

The Audit Committee of the San Diego City Council convened on Wednesday, October 7, 2026, at 5:00 PM (17:00 UTC). The meeting was chaired by Council Member Moreno, with Vice Chair Foster, Committee Member Halpern, and Committee Member Mafia present. The primary agenda item was the Office of the City Auditor's Recommendation Follow-up Report, which reviewed the status of 189 open audit recommendations, including 107 past their original implementation dates. The committee discussed implementation progress, revenue opportunities, and challenges across multiple city departments.

Consent Calendar

• Item 1: Approval of the committee minutes from September 2, 2026 – Approved unanimously (4-0, with one member absent).
• Item 2: City Auditor's monthly activity report – Approved as part of the consent agenda.

Public Comments & Testimony

• Non-Agenda Public Comment:

  • Maximilian Schmidt described being homeless and targeted by organized persecution, alleging torture and ID theft. He demanded an end to the alleged harassment.
  • A speaker (name not provided) criticized a $3.1 million fence at the downtown police station (1401 Broadway), questioning the expenditure and urging an audit of the cost. He argued the fence sends a wrong message and that police should not need such protection from the public they serve.
  • Becky Rapp called for a comprehensive performance audit of the Cannabis Business Division, noting it was identified as a risk area in the FY2023 risk assessment but no audit has been conducted. She questioned the transparency of the city's process for evaluating identified risks.
  • Joyce Sanyata expressed excitement about the Draft Performance Management Principles and Practices, highlighting principles such as purpose, outcomes, transparency, and adaptive systems.
  • Madison requested an audit of marijuana edible exposures among children in San Diego County, asking for detailed data on product types, THC concentrations, and packaging to inform prevention efforts.
  • Blair Beekman spoke about open participatory democracy and the need for public oversight on surveillance technology, advocating for local government leadership in setting best practices.

• Consent Agenda Public Comment:

  • Maximilian Schmidt opposed approval of the minutes, alleging “liberal fascism” and requesting lie detector tests for council members regarding Second Amendment enforcement and occult practices.
  • Blair Beekman commended the committee’s work and commented on the monthly audit report, noting the complexity of the street light repair program and the importance of tech accountability.
  • A caller (phone ending 870) thanked Blair and asked questions about the street light audit (surveillance connection), cybersecurity (AI and FBI hack), and SDPD internal affairs (lawsuit and Supreme Court decision).

• Discussion Item (Item 3) Public Comment:

  • Maximilian Schmidt opposed the recommendation follow-up report, calling for city hall to be shut down due to alleged “underground genocide.”
  • Hector commended the auditor for exposing fraud and suggested hiring convicted white-collar criminals to help recover money.
  • A caller (phone ending 870) praised the 26 new recommendations and asked why 107 recommendations are past due, what obstacles exist, and expressed concern about the city's operating principles lacking explicit core values.
  • Blair Beekman stressed the need for better communication between city government and the community.
  • Tony (phone) criticized the discrepancy between staff-provided information and actual performance, and referenced a San Diego Union-Tribune report on unenforced tenant violations and mismanaged real estate.

Discussion Items

• Item 3A: Office of the City Auditor's Recommendation Follow-up Report – Section A (Recommendations for Committee Action)

  • Building Acquisitions Audit (Recommendation 7): The committee discussed the ongoing issue of ensuring city staff provide complete and accurate information to the council. Management declined to implement attestations. The city attorney’s office had added charter section 32.1 to the personnel manual, and HR updated the employee code of conduct. The auditor recommended closing as “partially implemented, no further action,” but committee members expressed concern that the risk was not fully mitigated. Council Member Foster argued that performance evaluations should incorporate accuracy requirements. The motion was modified to keep Recommendation 7 open (not closed) pending further action.
  • Code Enforcement Audit (Recommendations 2, 7, 8): The department requested consolidation of recommendations 2, 7, and 8 into recommendations 9 and 10, citing budget cuts and staffing losses (50% reduction over two years). The auditor proposed closing them as “will not implement” with the understanding that the underlying risks would be addressed through remaining recommendations. The committee questioned how the department ensures cases needing attention are identified under the current manual process (using Power BI instead of automated reports). The motion passed to close recommendations 2 and 8, but keep recommendation 7 open.

• Item 3B: Discussion of Audits Recommended for Committee Discussion (Led by Committee Members Halpern and Mafia)

  • Real Estate Portfolio Management (Audit 1902): Discussion centered on the lack of a comprehensive Real Property Management Plan (PMP) since 2011. The economic development department reported that a consultant is needed but not resourced. The committee expressed frustration that the city does not know the total value of its real estate portfolio, potentially leaving millions in revenue uncollected. Staff noted a 91% increase in real estate transactions over two years and an internal analysis that an additional $10 million per year could be generated if properly resourced.
  • Lease Management (Audit 2207): Several priority-one recommendations remain open since 2022. The department reported progress on holdover leases (reduced from 25% to 17.5%) and on centralizing lease management. However, recommendation 9 (oversight of non-competitively priced leases) is tied to the PMP and remains outstanding.
  • Leased Golf Courses (Audit 2605): The Fairbanks Ranch Country Club lease rent was increased by 41% (from 5% to 7% of revenues) following an appraisal. The IBA review of the appraisal is pending due to focus on other large projects. The committee questioned whether the rate is below market compared to Torrey Pines (9.9%). A new fee for inspections and investigations is being developed, with a target of end of FY2027.
  • SDPD Body-Worn Cameras (Audit 2301): Six recommendations are past due, all stuck in meet-and-confer with the police union. The audit found officers fail to record body camera video 40% of the time. The recent police union contract did not include this topic. The committee expressed strong disappointment over the delays, noting the issue has been open since July 2022.
  • SDPD Overtime (Audit 2408): Recommendations on eight-hour between shifts and centralized overtime are also in meet-and-confer. The department has centralized plug-and-play overtime via PD Enterprise, saving $6.8 million in FY26. A new scheduling system is in the RFP process but stalled.
  • Equity in Recreation Programming (Audit 2205): All 12 recommendations are past due. The Community Recreation Needs Assessment was completed in September 2026 with 10,000 responses. The department plans to present findings to the Community and Neighborhood Services Committee in January 2027 and complete a strategic plan by mid-2027. The committee noted that a $1 million funding request was not approved in FY27 and that a dedicated recreation specialist position was eliminated.
  • Boat Storage Permits (Audit 2505): Fees have been increased up to 50% through inflation adjustments. A fee update and municipal code amendments for a lottery system will go to committee in October 2026, with full implementation expected by spring 2027.
  • Stormwater Reinspection Fee (Audit 18023): This recommendation dates to June 2018. The department is reassigning existing staff to develop the fee, now targeting June 2027. The fee could generate $1.45 million to $1.5 million per year. The committee noted that every month of delay costs $100,000–$300,000 in lost revenue.
  • Fire-Rescue Emergency Medical Response (Audit 2606): The department is developing a dashboard to track turnout times and response times. The standards of coverage study is near completion. A budget request for capital purchases is planned for mid-year or FY28. The department will return in November 2026 with a detailed presentation on dispatch triage tools.

Key Outcomes

• Consent Agenda: Approved unanimously (4-0).
• Section A Motions:
  • Motion to close Recommendation 7 (Building Acquisitions) as “partially implemented, no further action” was modified to keep Recommendation 7 open (pending further action on incorporating accuracy into performance evaluations). The motion passed (4-0).
  • Motion to close Recommendations 2 and 8 (Code Enforcement) as “will not implement” passed (4-0). Recommendation 7 from that audit remains open.
• Section B Discussion: No formal motions taken; discussion highlighted ongoing challenges and progress. Key follow-ups include:
  • The IBA is to provide a review of the Fairbanks Ranch lease appraisal.
  • Fire-Rescue is to present a detailed dispatch and response time analysis at the November 2026 meeting.
  • Stormwater department is to brief council offices on the reinspection fee in the coming months.
  • Parks and Recreation will present the Community Recreation Needs Assessment to committee in January 2027.
• Public Member Appointment: The IBA reminded the committee that applications are open for a public member position on the audit committee (requirements: 10+ years as CPA, CIA, or equivalent experience).
• Next Meeting: Scheduled for Wednesday, November 12, 2026, at 9:00 AM.