San Diego City Council Meeting: Audit Reports on Contract Management and Fleet Maintenance – October 6, 2025

The San Diego City Council met on October 6, 2025, to receive two performance audits from the Office of the City Auditor: one on contract management and one on fleet maintenance. The meeting began with a closed session where the Council voted 7-0 to accept a $115,000 settlement in the case Lisa Castro vs. City of San Diego. Both audits were informational items; no votes were taken on them. Councilmembers expressed concerns about unauthorized spending, retroactive approvals, and maintenance compliance. Public comment addressed both audits and non-agenda topics including water rates, youth substance use prevention, and the Torrey Pines Gliderport.

Public Comments & Testimony

• Item 201 (Contract Management): Multiple speakers supported the audit and urged timely implementation of recommendations. One speaker criticized the city for unauthorized spending, citing the example of a $6.7 million contract increase with HERC rentals. Another speaker called for monthly updates on recommendation progress.
• Item 200 (Fleet Maintenance): A union representative (Paul Garabay, Vice President of AFSCME Local 127) noted that the number of fleet technicians has not kept pace with fleet growth. Other speakers expressed concern about vehicle maintenance delays and safety.
• Non-Agenda Public Comment: Speakers addressed water rate increases (citing alternatives from Padre Dam Municipal Water District), youth exposure to marijuana and e-cigarettes, and the Torrey Pines Gliderport. One speaker called for a meeting with Councilmember Von Wilpert regarding the gliderport.

Discussion Items

Item 201: Performance Audit of City's Contract Management

• Presentation: City Auditor Andy Hanh and his team presented findings: 11% of contract alterations ($15 million) were not brought to council for approval as required; 19% ($64 million) were brought retroactively; 42% of alterations ($155 million total) were untimely. Recommendations included updating council approval thresholds (last updated in 2012), clarifying language in the municipal code, and improving the ARIBA contract management system.
• Purchasing & Contracting Response: Claudia Abarca (Director of Purchasing & Contracting) noted that 8 of 13 recommendations have been implemented. Remaining items include municipal code amendments (expected within six months) and quarterly memoranda to council (first to be issued that week).
• Councilmember Comments: Councilmember Moreno (Audit Committee Chair) expressed disappointment and noted that unauthorized spending reduces public transparency. Councilmember Von Wilpert questioned a specific $6.7 million contract increase with HERC that was adjusted in ARIBA without council approval; she called for consequences and urged colleagues to vote against such contracts. Councilmember Elo Rivera highlighted the trust deficit and cautioned that raising mayoral approval thresholds might not solve underlying issues. Councilmember Lee clarified that while contract amounts were exceeded, budgets were not always overspent. Councilmember Foster asked about enterprise fund impacts. Councilmember Whitburn noted the need for better system integration.

Item 200: Performance Audit of City's Fleet Maintenance

• Presentation: The audit found that only 20% of preventive maintenance services were completed on time (39% with a 10% grace period). Only 35% of BIT safety inspections were on time. Turnaround time averaged 3 days, though actual labor was only 2 hours; 77% of services had delays, mainly due to labor shortages. The fleet has grown by 1,000 vehicles since FY2021 without corresponding technician hires. Recommendations included designating fleet coordinators, scheduling appointments, and analyzing staffing levels.
• Fleet Management Response: Michira Little (Director of General Services) reported 2 of 10 recommendations completed, with progress on BIT inspection compliance (now 91%). Fleet is exploring schedule changes and weekend work to increase capacity.
• Councilmember Comments: Councilmember Moreno noted that repair costs ($19.3M in FY23) far exceed preventive maintenance costs ($2.2M) and asked about potential savings. Councilmember Elo Rivera emphasized including worker input (AFSCME) in solutions. Councilmember Von Wilpert questioned why fleet KPIs were removed from the budget and pressed for timely implementation of recommendations. Councilmember Foster raised concerns about enterprise fund impacts on rates. Councilmember Lee highlighted the need for more technicians and noted that the audit did not recommend schedule changes but rather appointment scheduling.

Key Outcomes

• Closed Session: The Council voted 7-0 to accept a $115,000 settlement in Lisa Castro vs. City of San Diego (Councilmembers Lacava and Moreno absent).
• Item 201: No motion required. Management agreed to all recommendations. Key timelines: municipal code amendments within 6 months; quarterly contract status memos beginning Q1 FY26; ARIBA guidance policy within 2 weeks.
• Item 200: No motion required. Management agreed to all recommendations. Two recommendations completed; remaining to be finished by end of calendar year or June 2026. Fleet is exploring meet-and-confer with unions on schedule changes.
• General Notes: Councilmembers expressed frustration regarding unauthorized spending and maintenance delays. Councilmember Von Wilpert urged colleagues to vote against contracts that are brought retroactively or without proper approval. The council stressed the need for better oversight and accountability.