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ALL RIGHT.

GOOD

[00:00:01]

AFTERNOON, EVERYONE.

THANK

[Audit Committee Meeting on March 28, 2022.]

YOU FOR COMING TO THE AUDIT COMMITTEE MEETING.

IT'S A CITY OF GARLAND CITY COUNCIL AUDIT COMMITTEE MEETING MARCH 28TH, 2022.

AND IT IS ABOUT 2 0 1.

WE'RE GOING TO GO AHEAD AND GET STARTED.

UH, I HAVE WITH ME TODAY, DEPUTY MAYOR PRO TEM, BJ WILLIAMS, AND, UH, COUNCIL MEMBER, ROBERT JOHN SMITH.

MY NAME IS RICH ALBAN.

I AM THE SHORT TERM COUNCIL MEMBER.

I'LL BE OFF IN ABOUT A MONTH, BUT, UH, FOR NOW I AM CHAIR OF THE COMMITTEE.

UH, AND WITH THAT, UH, LET'S GO AHEAD AND GET STARTED.

FIRST ITEM ON THE AGENDA IS THE APPROVAL OF THE DECEMBER 13TH, 2021 MEETING MINUTES.

SO EVERYONE HAD A CHANCE TO REVIEW THOSE MOVE APPROVAL.

ALRIGHTY.

WE HAVE A MOTION TO APPROVE THE MINUTES IN THE SECOND.

ALL THOSE IN FAVOR.

AYE, AYE.

AND THEN IT'S APPROVED TO UNANIMOUSLY WILL GO AHEAD AND EXECUTE THOSE, UM, NEXT ITEM ON THE AGENDA.

WE'RE GOING TO HOLD AWARENESS, TAKE SOME THINGS A LITTLE BIT OUT OF, UH, OUT OF ORDER.

UM, JUST TO ALLOW SOME LATITUDE FOR SOME OF OUR FOLKS WHO ARE COMING IN A BIT LATE.

SO WHERE WOULD YOU LIKE TO START JED? THE MULTIFUNCTION DEVICES CHAIRMAN, IF I MAY BEFORE THEN.

OH, I'M SORRY.

YES, PLEASE.

DO I UNDERSTAND WE HAVE SOME NEW PEOPLE IN YOUR DEPARTMENT.

WE NEED TO GIVE THEM THE APPROPRIATE, WELCOME AND HAZING RITUAL.

THAT'S TO TELL YOU ABOUT THAT.

UH, AS, AS MANY OF YOU ARE AWARE, TED DUMITRU, WHICH RETIRED FROM THE CITY A FEW MONTHS AGO, AND BEFORE THEN JESSE HAD TO MOVE BACK IN TO OHIO TO BE WITH CLOSE TO HIS FAMILY.

SO WE HAVE TWO NEWCOMERS WITH US.

UH, FIRST ONE IS ROBERT, OREGON, ROBERT HE'S OUR SENIOR AUDITOR.

HE ACTUALLY CAME FROM THE TEXAS ATTORNEY GENERAL'S OFFICE.

HE'S BEEN AN AUDITOR FOR AWHILE.

UM, SO PRIOR TO THAT, HE WAS AN AUDITOR WITH COLIN COUNTY, AS WELL AS FOR OUR DEPARTMENT OF REVENUE.

HE'S ALSO AN ARMY VETERAN.

SO WE WANT TO THANK HIM FOR HIS SERVICE TO THE NATION.

SO THAT'S ROBERT, THE NEXT PERSON WHO IS OUR NEWCOMER STARTED TODAY HE'S IS A LOCAL TEXAN.

AND SHE ACTUALLY WAS PRIOR TO THIS, SHE SERVED THE NATION, SERVED US IN THE U S MARINE CORPSE FOR ABOUT FIVE AND A HALF YEARS.

SO HER BACKGROUND IS BUDGET FINANCIAL MANAGEMENT AND AUDIT STAFF.

SO SHE'S HERE.

NO MA'AM YOU CAN'T HAVE IT.

SO THAT'S THAT THOSE ARE THE TWO NEW COMMERCE.

I ALSO WANT TO INFORM THE COMMITTEE THAT WE RECENTLY PROMOTED PATRICIA TO BE THE SENIOR AUDITOR.

SO JOIN ME IN CONGRATULATING HER WITH, UH, WITH THE DEPARTMENT NOW.

YES, WE CAN MOVE TO THE MULTIFUNCTION DEVICES.

THAT'S GREAT.

WE HATE TO LOSE TED, BUT WE'RE ALWAYS HAPPY TO HAVE NEW FOLKS, SO WELCOME TO THE CITY AND CONGRATULATIONS ON THE PROMOTION.

AND HOPEFULLY YOU GUYS WILL CONTINUE THE LEGACY OF GREAT WORK.

UH, THAT'S HAPPENS IN THE AUDIT DEPARTMENT HERE.

WE'RE VERY GRATEFUL FOR THE DEPARTMENT.

OKAY, JEN, GO FOR IT, SIR.

THANK YOU.

UH, GOOD AFTERNOON, EVERYONE.

ONCE AGAIN, I APPRECIATE THE OPPORTUNITY TO, TO GO OVER THIS AUDIT REPORT WITH YOU, TED, ACTUALLY, BEFORE HE LEFT, FINISHED THIS AUDIT, WE HAD FOUR OBJECTIVES.

THE FIRST ONE WAS TO DETERMINE IF COPIER LEASES ARE ENTERED INTO AND MAINTAIN IN ACCORDANCE WITH THE PURCHASING DIRECTOR.

NUMBER ONE AND ADMINISTRATIVE DIRECTIVE.

NUMBER FIVE SECOND OBJECTIVE WAS TO VALIDATE INVOICES RATES AND PAYMENTS AGREE TO LEASE AGREEMENTS.

THIRD ONE WAS TO EVALUATE COPIER LEASE PROCESS FOR EFFICIENCY AND ECONOMIES OF SCALE.

THE LAST OBJECTIVE WAS TO DETERMINE IF COPIER AGREEMENTS ARE EVALUATED FOR GAS, B 87, UH, THE AUDIT SCOPE COVERED PRETTY MUCH ALL CITY DEPARTMENTS AND PAYMENT ACTIVITY FROM JANUARY 1ST, 2020 THROUGH DECEMBER 31ST, 2021.

DURING THE AUDIT, HE CAME TO FIND OUT THAT THE PROCESS OF ENTERING INTO COPIER LEASE AND MANAGING THE LEASE, UH, THROUGH THE TERM IS DECENTRALIZED WITHIN THE CITY, UH, DEPARTMENT PERSONAL MANAGE THE PROCESS VERSUS A CENTRALIZED APPROACH.

UH, DURING THE AUDIT, WE IDENTIFIED THAT ACROSS THE CITY, THERE ARE APPROXIMATELY 50 LEASES.

UM, THE CITY IS IN OUR OPINION, IS LOSING OUT ON COST SAVINGS SINCE THE COPIERS ARE ON MULTIPLE LEASES.

I DO WANNA, UH, GIVE ONE EXAMPLE HERE, UH, KUDOS TO DEL KLEIN.

UH, YOU KNOW, HE'S NOT PAYING ATTENTION, BUT, UH, THERE YOU GO.

BUT AFTER HE, HE RECENTLY, A FEW MONTHS AGO, HE ACTUALLY COMBINED NINE GP AND ELISA'S INTO ONE ONE LEASE, WHICH SAVED THE DEPARTMENT APPROXIMATELY $800 PER MONTH.

THAT'S JUST GPL.

AND SO WE BELIEVE

[00:05:01]

IF YOU'RE ABLE TO COMBINE THESE 50 LEASES INTO ONE OR TWO, A FEW, AT LEAST, UH, WE SHOULD BE ABLE TO FIND SOME COST SAVINGS FOR THE NEXT ITEM THAT WE IDENTIFIED DURING THIS AUDIT.

UH, AGAIN, GOING THROUGH NEGOTIATING THESE LEASES AND EXCHANGING UNITS PAYMENT PROCESSING, IT TAKES A LOT OF ADMINISTRATIVE TIME.

WE IN OUR DEPARTMENT, WE OURSELVES WENT THROUGH THAT STRUGGLE.

IT TOOK US ALMOST THREE MONTHS TO GET A NEW COPY MACHINE TO OUR DEPARTMENT AND TO ACCURATELY PROCESS ALL THE BILLING AND EVERYTHING.

SO WE BELIEVE ONCE AGAIN, ADDING THOSE LEASES INTO VERY FEW WILL HELP US IN FINDING EFFICIENCY THROUGHOUT THE CITY.

WE ALSO LEARNED THAT SENSITIVE AND CONFIDENTIAL DATA MAY NOT BE DELETED FROM THE COPIER HARD DRIVES AND UNITY IS TAKEN OUT OF SERVICE.

UH, WE ACTUALLY HAD TO REQUEST THAT INFORMATION REQUEST TO REMOVE OR DELETE THE INFORMATION FROM THE HARD DRIVES WHEN OUR, UH, OLD COPIER WERE TAKEN OUT, UH, FROM SERVICE.

UH, IT TOOK US A FEW FEW ATTEMPT FOR XEROX TO DO THAT.

THE NEXT ITEM, UH, SINCE WE HAVE THIS MANY DIFFERENT MODELS AND DIFFERENT LEASES, UM, IT'S THE BLACK AND WHITE AND THE COLOR PAGE ALLOWANCE AND THE RATES ARE ALL OVER.

UM, THAT'S ANOTHER THING THAT WE ARE IN DEFIED ALSO FROM A GASPE 87 PERSPECTIVE, WE NEED TO HAVE BETTER TRACKING.

CURRENTLY COPIER EXPENSES ARE QUARTERED INTO 11 DIFFERENT FINANCIAL ACCOUNTS, CREATING CHALLENGES FOR US TO CAPTURE THAT INFORMATION.

WE ALSO KNOW THAT THAT OF THE 50 LEASES, 23 WERE NOT EXECUTED IN ACCORDANCE WITH THE PURCHASING DIRECTIVE OR THE RECESSIONAL LIMITS IN A LOT OF CASES.

MANY OF THOSE, UH, APPROVALS WERE HAPPENED IN AN ADMINISTRATIVE STAFF LEVEL.

UM, SO THAT IS NOT IN ACCORDANCE WITH OUR DIRECTIVE.

NEXT ONE, SIX DEPARTMENTS ARE OPERATING WITH AN EXPIRED LEASE THAT CREATES AN AUTOMATIC ANNUAL RENEWAL, NOT A MONTH, TWO MONTHS PAYMENT RENEWAL CIVICS ALSO HAD MULTIPLE BUSINESS UNITS.

AND DEPENDING ON THE LEASE, THE CITY HAS TO MAKE SEPARATE PAYMENTS.

AND THEY RECENTLY DECIDED NOT TO TAKE OUR P-CARD ACCEPT OR P-CARD THAT CREATES ANOTHER INEFFICIENCY DURING THE PROCESS.

THE PURCHASING DIRECTIVE CURRENTLY CONTAINS LIMITS FOR THE RT FOR LISA PAUL WAS BASED ON AN END, WE'LL SPEND NOT THE TERM OF THE LEASE OR CONTRACT.

WE BELIEVE THAT'S PART OF THE ISSUE.

FOR EXAMPLE, STAFF MIGHT SAY, OKAY, THIS LEASE IS $220 PER MONTH, AND WE CAN GO AHEAD AND APPROVE THIS LEASE.

BUT IN REALITY, UH, THE LIST, IF YOU LOOK AT THE LEASE TERM, IT COULD BE GREATER THAN 50,000 OR A HUNDRED THOUSAND.

SO THAT'S, THAT'S A RECENT ONCE AGAIN, DARRYL AND GPL, UH, TOOK THAT ACCOUNTABLE AND THEY ACTUALLY BROUGHT THAT LIST TO THE CITY COUNCIL FOR ITS APPROVAL.

UM, SO AGAIN, THEY DID THE RIGHT THING.

THERE ALSO, WE HAD DIFFICULTIES FINDING LEASE AGREEMENTS SINCE IT'S NOT CENTRALLY MAINTAINED MAINTAINED.

SO THOSE WERE THE OBSERVATIONS OF THE AUDIT FOR THAT.

WE MADE THESE RECOMMENDATIONS, THE CITY MANAGEMENT SHOULD WORK WITH THE VENDORS TO COMBINE OUR CURRENT LEASES.

THEN AT THE END OF THE DEVICE, JAM INVITE A REQUEST FOR PROPOSAL TO OBTAIN A SINGLE NEW LEASE FOR COPIERS ACROSS THE CITY.

ADD LANGUAGE TO THE LEASE AGREEMENT THAT ADDRESSES WIPING COPIER HARD DRIVES TO PROTECT SENSITIVE AND CONFIDENTIAL INFORMATION, CENTRALIZED THE PROCESS TO OBTAIN AND MANAGE CORPORATE LEASES COMPLETE THE CORPORATE LEASE REVIEW TO COMPLY WITH GASPE 87 REQUIREMENTS, CHANGE THE PURCHASING DIRECTOR LANGUAGE FOR THE APPROVAL LIMIT TO THE LIFE OF LEASE OR CONTRACT VERSUS ANNUAL SPEND.

UH, I DO WANT TO APPRECIATE, UH, THE DEPUTY CITY MANAGER, MITCH AND ALL THE CITY DEPARTMENT MANAGING DIRECTORS FOR WORKING WITH US THROUGHOUT THIS AUDIT.

SO THOSE WERE THE OBSERVATION AND THOSE WERE OUR RECOMMENDATIONS AND MANAGEMENT CONCURRED, UH, ACCORDING TO MITCH, UH, AND BASED ON THE IMPLEMENTATION DATE, IT IMPLEMENTATION HAS BEGAN IMMEDIATELY WITH THE FULL IMPLEMENTATION AND SUPPORTED BY THE FOURTH QUARTER OF 2022.

WITH THAT I WILL ANSWER ANY QUESTIONS, MR. I THINK, UH, THANKS.

THANKS JEFF.

FOR THAT, FOR THAT, JUST A COUPLE OF QUESTIONS, ONE, UM, HOW MANY COPIES OF YOUR VENDORS TO, AND WHO ARE THEY? UM, XEROX AND KONICA-MINOLTA OKAY.

ARE THE AGREEMENTS SIMILAR OR THE SAME BETWEEN THE TWO? UM, THE TERMS ARE DIFFERENT.

THE WEIGHTS ARE DIFFERENT, BUT I MEAN, THE TERMS ARE BETWEEN 48 TO 60 MONTHS.

YES.

OKAY.

UH, THE SECOND QUESTION IS, WHAT ABOUT SUPPLIES DO WE HAVE, HOW IS THAT HANDLED? DO WE HAVE

[00:10:01]

A, A CONTRACT WITH A PARTICULAR VENDOR OR DO WE HAVE A SOLE SOURCE? HOW, WITH ALL THOSE COPIES, I'M THINKING ABOUT THINGS LIKE PAPER AND INK CARTRIDGES NOT, OH, HOW IS, HOW IS THAT HANDLE EXCEPT PAPER.

EVERYTHING IS COVERED THROUGH THESE LEASE AGREEMENTS.

OKAY.

SO TECHNICAL SUPPORT, UH, INK, STAPLERS, STAPLES, ALL OF THAT IS COVERED FOR THE MOST PART.

OKAY.

OH, THEY'RE JUST COVERED.

AND YOU SETTING THE REPORT AND I MET GEM TO READ ALL THE RECOMMENDATIONS HERE.

SO HOW ARE WE GOING TO, UH, HOW WE ARE WE, ARE WE LOOKING AT CONSOLIDATION OF, OF AS FAR AS ORDERING, COPYING THOSE KIND OF THINGS SINCE, SINCE, SINCE YOU'VE INDICATED HERE THAT THAT MULTIPLE DEPARTMENTS ARE ENGAGED IN AND THIS FRONT END OR THIS PROCESS, CAN YOU JUST QUICKLY SUMMARIZE WHAT IS SUMMARIZE OUR RECOMMENDATION AS FAR AS ANY CONSOLIDATION OF THAT PROCESS? SURE.

YES, PLEASE.

SO THE, THE RECOMMENDATION IS TO CONSOLIDATE AND CENTRALIZE.

UH, SO WE MAY HAVE ONE OR TWO LEASE AGREEMENTS WITH EITHER XEROX OR KONICA-MINOLTA OR SOME OTHER VENDORS, OUR PREFERRED, UM, ACQUISITION PROCESSES.

ONCE WE CONSOLIDATED EITHER TO ONE OR TWO AGREEMENTS, WHEN THE LEASE EXPIRES, WE MAY, IT'S, IT'S A GOOD PRACTICE TO GO THROUGH AN RFP TO SEE IF THERE'S ANYONE ELSE WHO IS WILLING TO, UH, YOU KNOW, ONE WANT TO DO BUSINESS WITH THE CITY, BUT WE HAVE TO WAIT AT THIS POINT, WE HAVE THESE CONTRACTS ALL THE WAY TO 2026.

SO, UM, AT THIS POINT CONSOLIDATE INTO ONE OR TWO AGREEMENTS UNTIL THE CONTRACT EXPIRES.

THEN AT THAT POINT, DO AN RFP.

SO WE MAY HAVE ONE OR TWO LEASE AGREEMENTS GOING FORWARD.

OKAY.

DID YOU HAVE ANY FINDINGS? UH, MY LAST QUESTION IS REGARDING SERVICE AGREEMENTS OR THE SERVICE AGREEMENTS BUILT INTO THE INITIAL CONTRACT OR THOSE SEVEN CAN YOU, IT IS BUILT INTO THE CONTRACTS.

AND SO WE'VE GOT TWO DIFFERENT SERVICE AGREEMENTS WITH THE TWO DIFFERENT CARRIERS.

RIGHT NOW WE HAVE 50 DIFFERENT LEASE EXHIBIT 55 0.

SO WE HAVE 40 DIFFERENT AGREEMENTS WITH XEROX AND 10 WITH KONICA MINOLTA WHO ATTEND WITH T-REX AND MS. CONNIE CAME IN ALTAR AND 40 WITH ROCKS.

YEAH.

OKAY.

THANK YOU.

THANKS FOR THIS.

THANK YOU.

GOOD, GOOD, GOOD.

OH, GOOD.

I HAVE NO QUESTIONS.

I APPRECIATE YOUR, YOUR WORK ON THIS AND THANK YOU CHAIRMAN.

THANK YOU.

THANK YOU.

GOOD JOB.

SO THE NEXT AUDIT REPORT IS FOR THE FIRE PERIMETER AND INSPECTION AUDIT, FOLLOW UP.

AS MANY OF YOU REMEMBER, WE DID AN AUDIT BACK IN AUGUST 20.

WE ISSUED THE REPORT BACK IN AUGUST, 2018 FOR THE FIRE PERMIT INSPECTION AND, UM, AUDIT AUDIT REPORT.

UH, THE ORIGINAL OBJECTIVE FOR THOSE THAT AUDIT WAS TO VERIFY THE FIRE INSPECTIONS AND PERMIT ISSUANCE ARE CONDUCTED IN ACCORDANCE WITH THE CITY OF CODE AFFORDANCES.

PART TWO WAS TO ENSURE PROPER ACCOUNTING OF ALL THE FUNDS AND COMMITTEE.

IF YOU REMEMBER, WE HAD 37 RECOMMENDATIONS AT THAT TIME.

THIS HAS BEEN ALMOST THREE YEARS AGO AND, UH, WE ACTUALLY DID A FOLLOWUP, UH, THIS TIME AROUND.

AND WE DID IDENTIFY THAT APPROXIMATELY 26 OF THOSE RECOMMENDATIONS WERE FULLY IMPLEMENTED.

FOUR OF THEM WERE PARTIALLY IMPLEMENTED AND SEVEN DID NOT GET IMPLEMENTED.

I DO WANT TO THANK THE FIRE DEPARTMENT, FIRE CHIEF CHIEFLY, ASSISTANT CHIEF, LOVE IT.

AND LIEUTENANT SDS FOR WORKING WITH US THROUGHOUT THIS AUDIT FOLLOW-UP UM, SOME OF THE ACCOMPLISHMENTS THAT THEY HAVE MADE, UH, IS THEY ACTUALLY, SINCE THE AUDIT, THEY ACTUALLY WENT AND, UM, ENSURE THAT, UH, THE OCCUPANCY CLASSIFICATIONS WITHIN THEIR DATABASE IS, IS ACCURATE.

THAT WAS ONE OF THE MAJOR FINDINGS THAT WE HAD WHEN WE ISSUED THE INITIAL REPORT.

SO THAT PART IS WELL TAKEN CARE.

ALEX IS GOING TO GO OVER THIS.

HE DID THIS UP, I'M GOING TO TURN IT OVER TO HIM IN A MINUTE, BUT I DO WANT TO EMPHASIS A FEW THINGS.

AND ALSO THEY PUT A LOT OF GOOD CASH HANDLING CONTROLS IN PLACE.

SO THAT'S ANOTHER ACCOMPLISHMENTS FROM THIS FOLLOWUP.

ALSO, THEY PROVIDED A LOT, A LOT, A LOT OF STAFF TRAINING AND UPDATED THEIR MANUALS AND STUFF LIKE THAT.

PART OF THE REASON WHY THEY WERE NOT ABLE TO ACCOMPLISH, UH, FULLY IMPLEMENTING ALL THESE RECOMMENDATIONS.

THERE WERE A FEW REASONS.

AND WHEN WE DID THE AUDIT INITIAL AUDIT, THEY WERE USING A SOFTWARE CALLED FIREARM IS UNFORTUNATELY THEY HAD A LOT OF CHALLENGES WITH THAT.

AT THAT POINT, THEY

[00:15:01]

THOUGHT MOVING INTO A MICROSOFT PRODUCT CALLED CRM WOULD RESOLVE SOME OF THIS ISSUE.

UNFORTUNATELY, DURING THE PAST TWO YEARS, A FEW YEARS, THEY HAVE COME TO FIND OUT THAT CRM IS NOT THE SOLUTION, UH, FOR, FOR WHAT THEY NEED TO ACCOMPLISH.

SO THEY ARE ACTUALLY CLASSES TRANSITIONING FROM CRM TO IMAGE TREND.

IT'S A, IT'S A, IT'S ANOTHER SOFTWARE.

UH, MY UNDERSTANDING IS OTHER FIRE DEPARTMENTS ARE USING IT.

OF COURSE, CHIEF LEE'S HERE TO ANSWER ANY QUESTIONS.

SO, UM, HAVING THE TECHNOLOGY DIFFICULTIES, UH, CAUSED SOME OF THE DELAYS IN PERFORMING CERTAIN INSPECTIONS AND, UH, MOVING FORWARD WITH SOME COLLECTION EFFORTS.

AND AS EVERYBODY'S AWARE, WE ALSO HAD THE COVID IMPACT, UH, IN 2020, UH, ONCE THE COVID HIT, UH, THEY ACTUALLY DISCONTINUE THE PROCESS OF PERFORMING INSPECTIONS.

SO THAT ALSO IS REFLECTED, UH, AS WE ARE GOING THROUGH THE RESULTS OF THIS, UH, THIS AUDIT.

UM, SO KEEP THAT IN MIND, UH, AS ALEX IS GONNA COVER THIS DESCOPE FOR THIS FOLLOW-UP, WE COVERED PRETTY MUCH FROM JANUARY, 2018 THROUGH DECEMBER, 2021.

AT THIS POINT, I'M GOING TO TURN THIS OVER TO ALEX.

SO HE'S GOING TO GO OVER EACH ONE OF THE FINDINGS AND HE WILL INFORM THE COMMITTEE ABOUT THE STATUS OF THOSE RECOMMENDATIONS.

OKAY.

SO WHERE DID THE FINDING ONE DURING THE ORIGINAL AUDIT, THERE WAS AN ISSUE RELATED TO THIS IT'S NOT BEING PERFORMED TIMELY.

SO OCCUPANCIES CODED AS A E I H R AND S WHEN AUTO REQUIRE AN ANNUAL INSPECTION EACH YEAR, THE OTHER OCCUPANCY CLASSIFICATIONS REQUIRE ONE EVERY TWO YEARS OR BY ANNUALLY.

AND SO IN THE ORIGINAL AUDIT WE'VE WE SAW THAT ONLY 22% AND 50% OF THE ANNUAL INSPECTIONS WERE PERFORMED IN CALENDAR YEAR 2016 AND 2017 RESPECTIVELY AND ONLY 47% OF 87% OF THE BIANNUAL INSPECTIONS WERE PERFORMED TIMELY ENCOUNTER YEAR 20 16, 20 17.

AND, UH, SO OUR ORIGINAL RECOMMENDATIONS FROM THE AUDIT WERE THAT THE FMO SHOULD DEVELOP A COMPREHENSIVE PROGRAM TO ENSURE THAT ALL REQUIRED ANNUAL AND BI-ANNUAL INSPECTIONS ARE CONDUCTED WITH THE PRIORITY GIVEN TO THOSE, WITH THE HIGHEST RISK, AND TO ALSO IMPLEMENT A PROCESS, TO MONITOR AND EVALUATE THE PROGRAM IN A CONTAINER IN A CONTINUOUS MANNER.

AND SO THEY CONCURRED AND THEY CREATED ACTION PLANS THAT ADDRESSED THOSE, UM, THOSE THAT WE GAVE THERE.

AND THOSE ACTION PLANS WERE SUPPOSED TO BE IMPLEMENTED BY OCTOBER, 2018.

AND SO THE CURRENT STATUS OF THIS ISSUE IS THAT, UH, FOR ONLY 24% OF THE ANNUAL AND 20, SOME PERCENT OF THE BIANNUAL INSPECTIONS WERE TIMELY FOR THE CALENDAR YEAR OF 20 AND 21.

THIS WAS DUE TO THINGS LIKE JED AND MENTIONED WHERE COVID AND OTHERS ISSUES THAT HE KIND OF MENTIONED ALREADY.

AND ALSO FOR THE SECOND ONE, AN INSPECTION REPORT WAS CREATED ANY QUESTIONS ON THIS ONE BEFORE? ALL RIGHT, WE'LL GO TO THE NEXT ONE.

SO FOR FINDING TWO, THIS WAS, AGAIN, DURING THE ORIGINAL AUDIT, THERE WAS AN ISSUE RELATED TO THE CITY ORDINANCE FEES AND THE FMO FEES NOT BEING THE SAME.

UM, ALSO IN HERE WAS A ISSUE WITH THE SQUARE FOOTAGE, NOT, NOT GOING ALL THE WAY HERE, BECAUSE IT'S SUPPOSED TO GO TO 25,000 HERE, BUT THERE WAS A GAP HERE.

UH, AND SO DUE TO THIS DURING THE ORIGINAL AUDIT, UM, A SAMPLE OF INSPECTION FEES WAS TAKEN AND FOUND THAT 30% OF THOSE WERE NOT ACCURATELY CHARGED.

AND ALSO PART OF THIS TESTING WAS THAT I FOUND THAT THERE WAS 25 OCCUPANCIES WITH $0 INSPECTION FEES THAT DIDN'T HAVE A VALID REASON FOR NOT HAVING A BEING CHARGED AND INSPECTION FEE.

AND THE RECOMMENDATIONS FOR THIS WERE TO CONSIDER TRANSITIONING INSPECTION FEES, TO OPERATIONAL PERMIT FEES AND PROPOSE AN ORDINANCE CHANGE FOR CITY COUNCIL'S APPROVAL.

THIS WILL ENABLE THE CITY TO INVOICE AND COLLECT FEES PRIOR TO INSPECTIONS OR PROPOSE AN UPDATE TO THE CURRENT CITY ORDINANCE, TO ALIGN WITH THE FMO FEE SCHEDULE AND REQUEST APPROVAL FROM THE COUNCIL AS PART OF THE PRO PROPOSAL, THEY SHOULD CHANGE THE OR UPDATE THE SQUARE FOOTAGE AIR IN THE NEXT ONE IS THAT THEY SHOULD HAVE EVALUATE ROLES AND ACCESS RIGHTS WITHIN THE SYSTEM TO ENSURE THEY ARE PROPERLY SEGREGATED, SEGREGATE DUTIES BETWEEN ASSESSING FEES AND INVOICING INSPECTIONS, AND COLLECTIONS DEVELOP A PROCESS TO CONTINUOUSLY MONITOR PERMANENT INSPECTION FEES, TO ENSURE

[00:20:01]

THEY ARE ASSESSED IN ACCORDANCE WITH THE CITY ORDINANCE, AND THE EXPRESSIONS ARE APPROPRIATE AND TO CONSIDER BACKFILLING AND INSPECTIONS FROM 2017.

AND SO DURING THE ORIGINAL AUDIT, THEY CONCURRED AND CREATED THEIR ACTION PLANS TO ADDRESS THESE ISSUES, WHICH WERE SUPPOSED TO BE IMPLEMENTED BY, OR DECEMBER, 2018.

AND THE CURRENT STATUS OF THIS IS THE FEE SCHEDULE HAS BEEN CORRECTED, BUT THE SQUARE FOOTAGE ISSUE STILL HAS NOT BEEN UPDATED.

AND THE MOVE TO OPERATIONAL PERMITS HAD NOT YET BEEN COMPLETED EITHER.

AND SO FOR THE SECOND ONE, THE CRM ACCESS HAS BEEN SEGREGATED EXCEPT BETWEEN TEAM MEMBER TO TEAM MEMBERS.

SO EVERYONE, ALL THE TEAM MEMBERS HAD THE SAME ACCESS, BUT THE MANAGEMENT HAS DIFFERENT ACCESS THAN THE TEAM MEMBERS FOR NUMBER THREE.

UM, THE ASSESSING FEES SENDING INVOICES AND COLLECTING PAYMENTS HAVE BEEN SEGREGATED FOR NUMBER FOUR, UM, RANDOM SAMPLE OF INSPECTION AND PERMIT FEES, AND FOUND THAT THEY WERE BEING CHARGED ACCURATELY.

AND ALSO NOTED THAT 25% OF THOSE, UM, THE, THOSE, UM, FEES THAT WERE FOUND IN THE ORIGINAL AUDIT OF $0.

WE FOUND THAT THERE WERE 20 OR SORRY THAT ALL OF THOSE HAVE BEEN CHARGED A SUBSEQUENT INSPECTION FEE SINCE THE ORIGINAL AUDIT.

SO THEY HAVE BEEN CHARGED FEES SINCE THE ORIGINAL AUDIT, EXCEPT THERE WAS THREE OF THEM THAT WE WERE NOT ABLE TO FIND ANY FEES.

AND WE ALSO TOOK ANOTHER SAMPLE OF, UM, INSPECTION FEES THAT WERE FOR $0.

AND WE FOUND THAT THE REASON, OR THEY HAD A VALID EXPLANATION FOR ALL THE $0 CHARGES THERE.

AND FOR THE FIFTH ONE FMO BACK BUILD ALL THE 2017 AND 2018 INVOICES.

ANY QUESTIONS? OKAY.

SO THIS IS FOR FINDING 30 FROM THE ORIGINAL HONDA R.

SO DURING THE ORIGINAL IDEA, WE FOUND THAT THERE WAS, UM, AN ISSUE RELATED TO UNCOLLECTED FEES.

AT THE TIME, THERE WAS A TOTAL OF 93,580 ON COLLECTIVE FEES.

UM, AND AS PART OF THIS TESTING, WE FOUND THAT THEY DIDN'T HAVE A COLLECTION PROCESS IN PLACE.

SO THE, THERE WERE, THERE WAS ANYTHING BEING DONE FOR COLLECTING THESE FEES ARE OUR RECOMMENDATION FOR THIS WAS TO CONSIDER TRANSITIONING INSPECTION FEES, TO OPERATIONAL PERMIT FEES, TO PROVIDE CONTINUOUS OVERSIGHT OF FEES, ASSESSED AND COLLECTED, ENSURE THAT THE INSPECTORS VERIFY THE MAILING ADDRESS AND RESPONSIBLE PARTY INFORMATION DURING INSPECTIONS AND UPDATE RECORDS, ACCORDINGLY ENSURE ALL RETURN MAILS ARE VIEWED DAILY, UM, AND EVALUATE THE CITY'S ENFORCEMENT OPTIONS AND UTILIZE THEM WHENEVER THOSE WERE AVAILABLE MANAGEMENT CONCURRED, AND THEY CREATED THE ACTION PLANS TO ADDRESS THOSE.

AND THOSE ACTION PLANS WERE SUPPOSED TO BE IMPLEMENTED BY JANUARY, 2019.

AND THE CURRENT STATUS OF THIS IS THAT, UH, SO FOR THE FINDING ONE, THIS WAS KIND OF ALREADY MENTIONED ABOVE WHERE WE SAID THAT THEY HAVEN'T IMPLEMENTED THE MOVE TO OPERATIONAL PERMITS YET.

SO THAT'S JUST KIND OF WHAT WE MENTIONED ABOVE HERE.

FOR NUMBER TWO, WE IDENTIFIED THAT THERE WAS STILL AN OUTSTANDING BALANCE OF $243,000 AND 125 AND INSPECTION FEES FOR NUMBER 30, WE FOUND THAT THE TRAINING WAS PROVIDED AND THAT RANDOM AUDITS ARE BEING PERFORMED.

NUMBER FOUR, UH, RE TURN MAIL IS BEING PROPERLY HANDLED NOW.

AND NUMBER FIVE, THERE WEREN'T ANY NEW ENFORCEMENT OPTIONS IMPLEMENTED FOR THE COLLECTION OF THE OUTSTANDING FEES.

OKAY.

ONE QUESTIONS.

OH, WHAT'S THE PLAN GOING FORWARD TO COLLECT IF I MAY CHIEFLY? YES, SIR.

THANK YOU FOR THE QUESTION ON THE, UH, PLAN, MOVING FORWARD ON COLLECTIONS.

UH, WE'RE GOING TO BE WORKING, UH, WITH CITY STAFF AND BUILDING OFFICIAL AS WELL ON WHAT ARE THE OPTIONS, UH, FOR COLLECTING WEIGHT, WE HATE SHUT A BUSINESS DOWN BECAUSE THEY DIDN'T PAY A $25

[00:25:01]

INSPECTION FEE.

UH, YET THEY'RE PRODUCING TONS OF NOT TIMES, SOME CASES PROVIDING LARGE VOLUMES OF SALES, TAX DOLLARS AND SO ON AND SO FORTH.

SO WE'RE GOING TO, WE'RE GOING TO WORK WITH THEM AS MUCH AS WE POSSIBLY CAN TO GET OUR INSPECTION FEES PAID IN A TIMELY MANNER.

UM, AND THEN, LIKE I SAY, DEVELOP SOME OPTIONS OF, OF WHAT CAN WE DO.

WE'VE HAD A, AN RFP RECENTLY THAT WAS NONCOMPLIANT, UM, AND IT GOT DOWN TO THREATENING THEIR CERTIFICATE OF OCCUPANCY TO, TO GAIN THAT COMPLIANCE.

BUT THAT'S PROBABLY ONE OF THE OPTIONS THAT WE'LL START SEEKING.

UM, IN THESE CASES, DO WE HAVE ANY TIE IN WITH THINGS LIKE SUP RENEWALS OR, UH, AND THE INSTANCES OF THOSE, THEN WE WOULD CERTAINLY ADVISE COUNSEL WHEN THOSE ISSUES COME UP FOR RENEWAL OF ANY SITUATIONS THAT HAVE DEVELOPED THROUGH THE, THROUGH THE PROCESS OF THE CURRENT SUP'S.

YES, SIR.

GOT IT.

ALL RIGHT.

THANK YOU.

THANKS.

I TRIED TO ESCAPE, SIR.

I'M GOING TO GET IT GETTING THERE.

JUST TWO QUESTIONS FOR YOU.

UM, ONE ON THE FEES THAT WERE, THAT WERE NOT COLLECTED, AND THEN WE, WE LACK OF A BETTER TERM BACK BILLS.

WE BILL FOLK, HOW DID WE, HOW DID WE DO THAT? HOW DO WE NOTIFY FOLKS? UH, AND HOW DO WE COMMUNICATE THAT TO FOLKS THAT, THAT THEY HAD A FEE THEY HAD NOT BEEN PREVIOUSLY BUILT ON IT? THEY MAY HAVE NOT EVEN BEEN AWARE OF IT.

HOW DID WE COMMUNICATE THAT TO BUSINESSES? IT WAS COMMUNICATED THAT JUST THAT, THAT WE HAD INADVERTENTLY NOT BILLED THEM PRIOR INSPECTIONS AND HAD THEM INVOICED, AND THEN ANYBODY THAT HAD QUESTIONS COULD CONTACT, UH, THE, THE FIRE DEPARTMENTS ADMINISTRATION, AND IT WAS EXPLAINED TO THEM.

OKAY.

OKAY.

AND THOSE THAT DID NOT RESPOND THAT, BUT WHAT I MEAN, NOT RESPONDING, THEY DIDN'T SEND A CHECK.

UM, THE ONES THAT HAVE NOT SENT A CHECK ARE GOING TO BE REMINDED THAT THEY ARE STILL OUTSTANDING, UH, DEFICIENCIES AS WE GO AROUND AND DO OUR SUBSEQUENT INSPECTIONS, THERE'LL BE REMINDED AS WELL THAT THIS IS A NEW FEE PLUS THE ONE THAT CHARTIO, AND THEN THAT COLLECTION OPTIONS THAT WE'VE DISCUSSED JUST A MOMENT AGO, WE'LL START IMPLEMENTING THOSE.

OKAY.

AND THE PORTER ALSO SAID THERE WERE SOME CASES WHERE THERE WERE SOME SQUARE FOOTAGE EFFICIENCY.

UH, HOW DID WE COMMUNICATE THAT? AND HOW DOES THAT TIED INTO TIED INTO THE FEES THAT THESE BUSINESSES, PARTICULARLY THE RETRO FEES THAT THEY WILL BILLS AND HAVE, HAVE THE SQUARE FOOTAGE ISSUES BEEN RESOLVED? YES, SIR.

UH, THAT OVER THE COURSE OF THE COVID, UM, IN ORDER TO UTILIZE THE INSPECTORS MAN HOURS, UH, WE HAD THEM DO EXTENSIVE RESEARCH INTO EACH AND EVERY OCCUPANCY, UM, BETWEEN ALEX AND CHIEF LOVE IT.

AND CHIEF LOVITZ TEAM.

I'VE GOT GREAT CONFIDENCE IN OUR DATABASE.

NOW, I THINK AN ALISHA AND CORRECT ME IF I'M WRONG HERE.

I THINK ALL OF THE STUDIES THAT WE SAW WERE UNDERREPRESENTED IN SQUARE FOOTAGE, THAT THERE WAS ZERO SQUARE FEET OR 200 HAD BEEN ENTERED INTO A SYSTEM THAT WAS, UH, EITHER CORRUPTED BY THE D THE SOFTWARE ITSELF OR THE INSPECTORS.

DIDN'T SEE THE IMPORTANCE OF THAT.

SO WE'VE EDUCATED OUR TEAM ON THE IMPORTANCE OF ACCURATE NUMBERS.

UH, THE FOLKS THAT WERE UNDERREPORTED, WE BACKED BUILD THEM.

UH, AND TO MY KNOWLEDGE, WE DIDN'T HAVE ANYBODY THAT HAD A HIGH SQUARE FOOTAGE NUMBERS, SO WE DIDN'T HAVE TO REBATE ANY DOLLARS BACK TO THEM AS WELL.

UH, SO AGAIN, THEY HAVE BEEN CORRECTED THE, UH, CHIEF LOVITZ TEAM LITERALLY WENT TO THE FIELD ON A DAILY BASIS TO VERIFY THE OCCUPANCY CODE AND, UH, ESTIMATED SQUARE FOOTAGES, WHETHER IT WAS LOOKING AT, UH, D CAD MAPS, UH, GOOGLE EARTH MAPS, ANYTHING THAT WE'D GET OUR HANDS ON, AND AS WELL AS VISUAL INSPECTION OF THOSE PROPERTIES, UH, WITH MEASURING WILLS TO DETERMINE HOW MANY SQUARE FEET THEY ACTUALLY ARE OPERATING.

OKAY.

AND THEN WE DID, WE SEND THOSE NOTICES TO BUSINESSES VIA REGULAR MAIL.

UH, I BELIEVE SO CHIEF LOVE IT.

THEY GO BY REGULAR ROAD.

YES, SIR.

RUINED, FOUND, UH, THIS LAST YEAR WENT THROUGH AND FOUND ALL THE INVOICES THAT WE SAW AT ONE PAGE AND THEN SENT THEM BACK OUT OF HERE.

OKAY.

CHIEF, WHAT WAS THAT RETURN RATE? DO WE HAVE RETURN MAIL, RIGHT? I DO NOT KNOW, BUT I CAN SEE WHAT I CAN FIND OUT FOR YOU, BUT WE DID HAVE SOME RETURN, RIGHT? YES, YES.

BACK IN, UH, WE SENT THEM ALL OUT IN JANUARY AND THEN A LOT OF THEM THAT I SAW COME IN WERE DATED FOR THE 21 INVOICE.

SO I HAD SEVERAL OF THEM, BUT I CAN'T GIVE YOU A PERCENTAGE.

OKAY.

OKAY.

NOW, YEAH, CHIEF, I BE INTERESTED IN

[00:30:01]

THAT INFORMATION IF YOU, IF YOU CAN PUT THAT IN MY LAST QUESTION IS SORT OF A POLICY QUESTION TO OUR CITY ATTORNEY.

OH YEAH.

HE'S HE SAID, NO, THAT HE'S LONELY TALK TO HIM.

SO, AND IT CAME UP, UH, PICKED TO BE BACK ON COUNCILMAN SMITH'S, UH, QUESTION.

AND, AND I THINK THIS IS POLISHED DISCUSSION.

WHAT CAME UP ISSUE PIECE, IF SOMEBODY WAS, WAS SENDING A NOTICE, THEY DIDN'T PAY, UH, AND SENDING STUFF TO FOLKS, REGULAR MAIL THAT CAN YOU COMMENT ON, UM, UM, THAT I, I I'D BE VERY INTERESTED IN, IN THAT, BECAUSE THAT INVOLVES SOME OTHER THINGS I THINK, SO TO CONNECT THAT SOMEONE A BUSINESS DIDN'T GET IT, THEY DIDN'T PAY THE FEE, YOU KNOW, THEY SAID THEY DIDN'T GET THE LETTER.

AND IF WE START TYING IT TO THE P AND Z SIDE OF THE HOUSE, BUILDING INSPECTIONS BASED ON THAT, IS THAT SOMETHING THAT OPTIONS DOWN THE ROAD THAT WE SHOULD BE LOOKING AT FROM A POLICY STANDPOINT, IT'S CERTAINLY PERMISSIBLE ON THE LAW TO BUY THE RENEWAL OF AN SUP OR EVEN THE SUP ITSELF TO MAKING SURE THAT THEY'RE UP TO DATE WITH PAYMENTS WITH THE CITY.

NOW, HAVING SAID THAT THEY HAD, THEY OBTAIN A PROPERTY INTEREST ONCE THEY ARE ISSUED IN SUP OR ANY ZONING.

RIGHT.

AND SO IF WE'RE GOING TO REMOVE A PROPERTY INTEREST OR TAKE A PROPERTY INTEREST AWAY, WE WOULD CERTAINLY NEED TO MAKE SURE THAT THEY RECEIVED THE NOTICE AND THAT NOTICE WOULD BE CONFIRMED THROUGH CERTIFIED MAIL OR SOMETHING LIKE THAT.

OKAY.

ALL RIGHT.

THANK YOU.

THANKS CHAIR.

WE CAN CONTINUE NOW.

SO FOR THE NEXT FINDING, FINDING NUMBER FOUR, DURING THE ORIGINAL AUDIT, THERE WAS A FINDING RELATED TO THE OCCUPANCY CLASSES BEING MISCLASSIFIED, AND ALSO THERE BEING AN ISSUE WITH THE SQUARE FOOTAGE AND A SAMPLE WAS TAKEN AND FOUND THAT 26 OCCUPANCIES HAD THE WRONG OCCUPIED CLASS.

AND ALSO THERE WAS A TOTAL OF 189 OCCUPANCIES THAT HAD A SQUARE FOOTAGE OF LESS THAN 101 SQUARE FOOT.

OUR RECOMMENDATION FOR THIS WAS THAT THEY SHOULD REVIEW ALL OCCUPANT RECORDS AND UPDATE ANY INCORRECT OCCUPANCY, CLASSIFICATIONS, AND SQUARE FOOTAGE AND ENSURE THAT ALL OCCUPANTS ARE CLASSIFIED IN ACCORDANCE TO THE OXY CLASSIFICATIONS, UH, AND CREATE A REFERENCE GUIDE FOR THE INSPECTORS TO USE, TO VERIFY THE OXYGEN CLASSIFICATION AND DEVELOP WRITTEN POLICIES AND PROCEDURES FOR THE INSPECTORS TO USE WHENEVER THEY DO THE OXFORD CLASSIFICATION OF SQUARE FOOTAGE INSPECTIONS.

AND, UM, THEY CONCURRED WITH THIS AND THEY CREATED ACTION PLANS FOR THESE, WHICH WERE SUPPOSED TO BE IMPLEMENTED BY JANUARY, 2019.

AND THE CURRENT SENSES IS, UM, I LIKE WE, WE TOOK A RANDOM SAMPLE AND WE FOUND THAT THERE WERE 65 OCCUPANCIES THAT WERE CLASSIFIED CORRECTLY AND, UH, THE REMAINING WERE FAKE IT.

AND WE ALSO LOOKED AT ALL THE SQUARE FOOTAGE THAT HAD A SQUARE FOOTAGE OF LESS THAN 101.

AND THOSE HAD AN ADEQUATE EXPLANATION.

AND, UH, FOR THE SECOND ONE OR THE SECOND AND FOURTH ONE IN OXIMETRY CLASSIFICATION AND SQUARE FOOTAGE, VERIFICATION PROCESS WAS COMPLETED.

AND FOR THE THIRD ONE, THE TRAINING WAS PERFORMED.

ANY QUESTIONS? OKAY.

NEXT, UH, SO OOPS.

FINDING, OR THIS IS THE, UH, THE FIFTH FINDING HERE.

SO THIS WAS RELATED TO EXPIRE, PERMITS, NOT BEING TRACKED.

AND ORIGINALLY A SAMPLE OF AUTO REPAIR GARAGE PERMITS WERE LOOKED AT, AND, UH, 22 WERE FOUND THAT THEY WERE, OR I'M SORRY, 15 WE'RE OPERATING WITHOUT AN OPERATING PERMIT.

AND WE ALSO LOOKED AT A SAMPLE OF HAZMAT OCCUPANTS AND SAW THAT THERE WAS 25 THAT NEVER RECEIVED A HAZMAT PERMIT AND 11 WERE OPERATING WITH AN EXPIRED PERMIT AND R AND D HIGH PILE COMBUSTIBLE STORAGE.

UM, THOSE WEREN'T ABLE TO BE TESTED IN THE ORIGINAL AUDIT BECAUSE THEY DIDN'T HAVE, THERE WAS AN, A LACK OF DOCUMENTATION SLOS WEREN'T ABLE TO BE LOOKED AT.

AND OUR RECOMMENDATION FOR THAT ORIGINALLY WAS THAT THEY SHOULD CONSIDER INVOICING UPFRONT FOR PERMIT RENEWALS, IDENTIFY ALL EXPIRED AND OPERATIONAL PERMITS AND INITIATE PERMIT

[00:35:01]

RENEWAL PROCESS, UM, UPDATE THE HAZMAT RECORDS TO INCLUDE INFORMATION ON THE PERMIT, SUCH AS REASONS WHY IT DOESN'T REQUIRE HAZMAT PERMIT AND THE TIERED SITE OR THE MATERIAL TYPE, AND TO CREATE AND IMPLEMENT A PROCESS TO DOCUMENT THE HIGH PILE STORAGE THING AND TRACK THOSE TO, UM, MANAGEMENT CONCURRED.

AND THEY CREATED THEIR ACTUAL PLANS FOR THAT, WHICH WERE SUPPOSED TO BE IMPLEMENTED BY JANUARY, 2019.

THE CURRENT STATUS OF THIS FOR THE, UH, THE, THE ONE FOR IS THAT, UM, THEY HAVE A PROCESS FOR TRACKING PERMIT EXPLORATIONS AND INVOICING ANNUALLY IS BEING DEVELOPED, BUT IT'S NOT THERE YET.

AND FOR A NUMBER TWO, THEY FMO STATED THAT THE CRM DOES NOT ALLOW THEM TO TRACK THE PERMIT EXPLORATIONS.

AND FOR NUMBER THREE, FMO SAID THAT PUTTING ALL THE HAZARDOUS MATERIALS ON THE PERMITS, WASN'T SOMETHING THAT THEY WANTED TO DO AS IT WOULD MAKE THEM TOO LONG AND COMPLICATED, BUT THEY HAVE A, OR THEY CREATED A NEW PROCESS THAT THEY JUST STARTED WHERE THEY CAPTURED THE HAZARDOUS MATERIAL INFORMATION, WHENEVER PERMITS ARE RENEWED.

ANY QUESTIONS ON THIS FINDING SIX? SO THIS FINDING ORIGINALLY AND IDENTIFIED THAT THERE WAS INSPECTIONS THAT WERE, ARE RE INSPECTIONS THAT WERE BEING PERFORMED TIMELY.

ORIGINALLY A SAMPLE WAS TAKEN, AND IT WAS FOUND THAT 44% OF THOSE DIDN'T HAVE THEIR RE INSPECTIONS DONE LIKE A, A, A TIMELY LOT LONGER THAN 21 DAYS.

AND THE RECOMMENDATION FOR THIS WAS THAT THEY SHOULD DEVELOP WRITTEN POLICIES, PROCEDURES REGARDING THE TIMELINESS OF THOSE MONITOR, THE RE-INSPECTION TIMEFRAME TO SHORT DATING, BEING DONE TIMELY, AND TO DOCUMENT THE NEED FOR EXTENSIONS WHEN REQUESTED BY THE OCCUPANTS, THEY CONCURRED AND CREATED THEIR ACTION PLANS FOR THIS.

AND THE CURRENT STATUS OF THIS FOR NUMBER ONE IS THAT, UH, THE INSPECTION TIMEFRAME PROCEDURES WORK CREATED, UM, AND, AND FOR THE SECOND ONE, A RE-INSPECTION REPORT WAS NOT CREATED.

AND WE TOOK A SAMPLE AND WE NOTED THAT THERE WERE FIVE INSPECTIONS THAT WEREN'T BEING DONE TIMELY AND OF THOSE ONE WAS NEVER REINSPECTED.

UM, AND THE REMAINING FOUR TOOK 609 60, 30 AND 23 DAYS.

AND THE THIRD ONE IS THAT THE, THEY, THEY DOCUMENTED ANY OF THE EXTENSIONS IS STILL NOT BEING PERFORMED IF ANY QUESTIONS ABOUT, OKAY.

I MEAN, LE LEAVE IT TO, UH, OUR BED SINCE OF TIMING TO START AUDITING YIELDS OR INSPECTION RATE AFTER THE YEAR THAT WE START CLOSING ALL THE BUSINESSES DOWN FOR A PANDEMIC.

BUT, UH, AS FAR AS THE, UH, THE TIME TO REINSPECT, WHAT IS OUR CURRENT POLICY ON THAT? AND WHETHER OTHER GOOD, JUST REASONABLE CIRCUMSTANCES AROUND THE TIME TO REINSPECT, WAS IT, YOU KNOW, ARE WE FULL ON OUR SCHEDULE? WAS THERE STAFFING ISSUES THAT 609 1, WAS IT JUST ONE THAT SLIPPED THROUGH THE CRACKS? WHAT'S THE, YEAH.

AND THAT, OF COURSE, SOME OF THAT WAS COVID RELATED, DEPENDING ON WHICH ONE YOU LOOKED AT OUR RE-INSPECTION SCHEDULE, TYPICALLY WHEN THEY GO OUT AND THEY DO AN INSPECTION, THEY HAVE 14 DAYS.

IF THERE ARE, UM, ANY VIOLATIONS THAT THEY HAVE TO FOLLOW UP ON HOW THAT 14 DAYS IS, WE'RE GIVING THEM 14 DAYS TO GET IT FIXED.

SOMETIMES IT DOESN'T MAKE SENSE ON DAY 14, YOU KNOW, TO GO BACK BECAUSE WE'VE BEEN WORKING TO CATCH THIS PERSON FOR SIX MONTHS, YOU KNOW, OR WHATEVER.

AND SO WE'RE GOING TO BE ABLE TO THAT SIDE OF TOWN.

SO THEN WE'LL SLIP BACK DOWN AND TAKE CARE OF THEM.

I'M SORRY, WHAT WAS, WHAT WAS YOUR OTHER QUESTION? OH, I MEAN, YOU KNOW, IF, IF SOMEBODY GETS BACK TO YOU ON DAY 14 AND SAYS, JARED, THEY'RE GOING TO BE AVAILABLE FROM THIS DATE TO THIS DATE, WE TRY AND GIVE YOU THE SAME, YOU KNOW, IF THIS WERE CODE ENFORCEMENT, UH, YOU'D HAVE MUCH FOR YOUR HAND.

AND WE WOULDN'T QUITE BE SO DOWN IN THE DETAILS.

I THINK SO, UM, WE HAD A MEETING WITH ALL OF OUR FOLKS.

ONE OF THE BIG THINGS WAS WE WOULD RUN INTO SOMETHING LIKE THAT AND THE INSPECTORS WEREN'T DOCUMENTING IT AS TO WHY, AND, YOU KNOW, SHAME ON US.

BUT WE'VE SINCE HAD A MEETING AND A LITTLE TRAINING AND SAID, LOOK, YOU KNOW, ANYTIME W OUR JOB IS TO TRY TO GET OUR FOLKS,

[00:40:01]

YOU KNOW, TO, YES.

NOT TO PENALIZE THEM.

WE, WE, YOU KNOW, A LOT OF OUR FOLKS OUT THERE, THEY WANT TO DO THE RIGHT THING.

WE JUST NEED TO WORK WITH THEM.

SO NOW OUR INSPECTORS KNOW THAT IF IT NEEDS TO GO PAST THE 14 DAYS, YOU KNOW, THAT WE WILL DOCUMENT WHY, AND IF THEY'RE WORKING ON IT, AND THEN WE'LL JUST GO BACK OUT LATER ON AND NOT PENALIZE AND BOARD, AS LONG AS THEY'RE TRYING TO MAKE PROGRESS TOWARDS, YOU KNOW, MEETING WHAT THEY NEED TO MEET.

YEAH.

SO, I MEAN, I'M NOT TOO WORRIED ABOUT YOUR, YOUR RE-INSPECTION STOCK.

RE-INSPECTION TIMES JUST WRITE IT DOWN, YOU KNOW? RIGHT.

YOU CAN RECORD AND MAKE IT AUDITABLE, BUT I'M FINE WITH THIS.

ALL RIGHT.

THANK YOU, SIR.

VERY GOOD.

THANK YOU.

THANK YOU.

OH, OH, OH.

I JUST WANT TO MOVING FORWARD WITH, WE UNDERSTAND WHAT THE COVID AND ALL THAT.

UM, ARE YOU, IS THERE A, A TIMELINE OR PART OF YOUR GAME PLAN FOR, UH, LIKE SAY THE GARAGE IS TO REPAIR GARAGE? IS THERE A SCHEDULE OR YOU'RE WORKING ON A SCHEDULE, SORT OF A CATCH-UP SCHEDULE? WE KNOW YOU CAN'T CATCH UP IN A MONTH IN SIX MONTHS.

WE'RE NOT TALKING ABOUT THAT, BUT IS THERE IS A PLAN FOR, YOU KNOW, ALL OF US HAS GOT TO MAKE UP FOR COVID.

ALL OF US ARE SET BACKS IN THAT PERIOD, BUT IS THERE A PLAN COMING OUT OF THIS RECOGNIZING WHERE WE ARE NOW, RIGHT.

FOR A LITTLE BIT AT A TIME, YOU CAN'T DO IT ALL IN ONE DAY, BUT A LITTLE BIT, IS THERE PLAN, WILL THERE BE A PLAN ROLLED OUT FOR SORT OF CATCH UP ON, ON, ON, ON THIS YEAR? SO WHAT WAS THAT, WHAT IS THAT GOING TO LOOK LIKE? OR YOU MAY HAVE, I'M ASKING YOU TOO EARLY, BUT ONE QUESTION IS, WILL IT BE A PLAN, A STRATEGY FOR CATCHING UP RIGHT.

GRADUALLY? WELL, WHAT WE'RE, WHAT WE'RE DOING RIGHT NOW WAS THAT I HAVE ONE INSPECTOR WHOSE FULL JOB IS ONLY TO HIT THESE AUTO REPAIR GARAGES.

AND WE STARTED THAT JANUARY OF THIS YEAR.

UM, I KNOW IT TOUCHED ON, UH, SOME OF OUR PROBLEMS WITH THE CRM AND PERMITTING AND, UH, THE ISSUES THAT WE'RE HAVING ON THAT.

SO WHAT WE DO IS THAT PERMIT IS GOOD FOR A CALENDAR YEAR WHEN WE WERE, WE WERE RUNNING INTO PROBLEMS. YOU GO OUT AND YOU DO THIS, UM, THIS INSPECTION ON THIS DATE, AND IT'S A YEAR LATER.

AND THEN YOU GO TO THIS ONE AND IT'S A YEAR LATER.

SO WE'RE GOING WITH THE CALENDAR YEAR.

IT'S GOOD FOR RIGHT NOW, BUT I HAVE ONE PERSON WHOSE SOLE PURPOSE IS TO GO OUT AND DO AUTO REPAIR GARAGES.

AND HE FOLLOWS UP TO MAKE SURE THAT THEY'RE PERMITTED PROPERLY.

AND THAT IS HIS JOB.

CAUSE WE HAD OVER 500 OF THOSE IN THEMSELVES.

AND THERE'S A LOT OF WORK TO GO WITH THAT TO MAKE SURE THAT THEY'RE UP TO SNUFF.

SO WE ARE WORKING ON THAT RIGHT NOW.

OKAY.

OKAY.

AND I'M SURE YOU WOULD, HE'S HERE, I'M BACK FROM VACATION, UH, LUSHER CITY MANAGER LISTING.

BUT IF THERE WERE SOME STAFFING CHALLENGES ARE THERE AND I'M ASKING YOU TO LAY THEM OUT HERE TODAY, BUT THAT'S A PIECE THAT THAT'D BE INTERESTED IN IF, IF MOVING FORWARD, RIGHT.

IN ORDER TO GET THIS DONE, WE, AND THAT WAS THE CHALLENGE.

WE WERE, YOU WERE A SHORT STAFF, TWO POSITIONS.

SO WE HAVE SINCE GOTTEN THOSE HOLES FILLED, WHICH IS PART OF THE REASON THAT WE'RE, WE'RE DOING WELL NOW, UH, AT THIS TIME RIGHT NOW WE'RE REALLY MAKING PROGRESS ON THE INSPECTIONS BECAUSE I HAVE THE MANPOWER.

OKAY.

ALL RIGHT.

OKAY.

YOU OFF THE HOOK, SIR.

THANK YOU, SIR.

THANKS CHAIR.

THINK.

OKAY.

SO WE'LL GO TO THE, UH, THE NEXT ONE, UH, FIND IT FOR, FOR SO FINE.

NUMBER SEVEN.

SO DURING THE ORIGINAL AUDIT, THERE WAS A ISSUE RELATED TO THE BLUEPRINTS AND APPLICATIONS NOT BEING, UM, RETAINED.

AND DURING THE YEAR, AND DURING THIS, THEY TOOK AN SAMPLE AND FOUND THAT 16% OF THOSE WERE NOT BEING WERE NOT RETAINED.

AND THE RECOMMENDATION FOR THIS WAS TO DEVELOP A POLICY AND PROCEDURE TO TRACK AND SCAN THE BLUEPRINT, BLUEPRINTS, AND APPLICATIONS, AND TO PROVIDE OVERSIGHT OF THOSE BLUEPRINTS APPLICATIONS FOR RETENTION AND FEE ASSESSMENT, AND TO MEET WITH THE C SECRETARY TO EVALUATE THEIR COMPLIANCE WITH THE RETENTION AND SOME MANAGEMENT CONCURRED.

AND THEY CREATED THEIR ACTION PLANS THERE.

AND THE CURRENT STATUS OF THIS IS THAT THE APPLICATION RETENTION PROCESS WAS DOCUMENTED.

AND, UH, FOR THE SECOND ONE, THE APPLICATIONS AND BLUEPRINTS

[00:45:01]

ARE BEING PROPERLY RETAINED.

AND WE TOOK A SAMPLE AND WE FOUND THAT THE PERMIT FEES WERE ACCURATE FOR THOSE TWO.

AND THE THIRD ONE IS WE, WE VERIFY THAT THE MEETING BETWEEN THE FMO AND THE C SECRETARY DID OCCUR, DID HE QUESTIONS THE LAST ONE? WE'LL GO TO THE, UH, THE LAST ONE THEN.

SO FINDING NUMBER EIGHT.

SO THIS WAS A ISSUE THAT CAME OUT OF WHEN A, UH, A SURPRISE CASH COUNT WAS PERFORMED DURING THE ORIGINAL AUDIT.

AND THERE WAS A WHOLE BUNCH OF VARIOUS ISSUES THERE.

SO WE DON'T REALLY NEED TO GET TOO MUCH IN THE DETAILS OF THOSE.

YOU CAN JUST KIND OF SEE THOSE IN THE REPORT.

UM, AND AGAIN, THERE WAS A LOT OF RECOMMENDATIONS FOR THOSE.

SO WE DON'T REALLY GO OVER ALL THOSE IN DETAIL, BUT THE CURRENT STATUS OF THIS IS THAT THE RECOMMENDED OR THE PROCEDURES HAVE BEEN DEVELOPED, THE SAFES HAVE BEEN ADDED DAILY.

RECONCILIATIONS ARE NOW BEING PERFORMED.

THE TRAININGS THAT WERE LISTED IN THERE HAVE BEEN PROVIDED, AND THE DUTIES HAVE BEEN SEGREGATED AND THE CASH IS BEING STORED SECURELY AS WELL AS ALL OF THE OTHER THINGS WERE DONE FOR THE MOST PART.

NO QUESTIONS ON THAT ONE, EITHER.

OKAY.

THAT'S UP? YEAH, MAN, IF I MAKE A COMMENT, UH, THIS WAS A VERY COMPLEX, UH, FOLLOW UP AND I KNOW CHIEF LOVE IT, UH, WAS NOT INVOLVED IN THE BEGINNING WHEN WE DID THE INITIAL AUDIT.

SO HE BROUGHT IN AND HE DID A LOT OF WORK IN FIXING A LOT OF THIS.

AND, AND ALEX WAS ALSO NOT THE AUDITOR WHO PERFORMED THIS AUDIT EVEN WENT BACK AND PERFORMED THE FOLLOW UP, WHICH IS NOT EASY.

EVEN YOU HAVE TO FOLLOW UP SOMEONE ELSE'S WORK TO VERIFY, UH, THE WORK IS DONE ACCURATELY.

SO I JUST WANT TO EXPRESS OUR SINCERE APPRECIATION TO CHIEF LOVETT AND ALEX PLAZA FOR THE WORK THAT THEY HAVE DONE.

NO SAME HERE I, THIS IS, UH, THIS IS ONE OF THOSE VERY COMPLEX.

SOME OF OUR AUDITS ARE EASIER THAN OTHERS, AND THIS IS ONE OF THOSE VERY COMPLEX ONES, DIFFICULT TO FOLLOW UP ON.

AND WA I THINK YOU SAID 37 RECOMMENDATIONS RECOMMENDATIONS, AND THAT'S A LOT.

SO I REALLY APPRECIATE THE WORK THAT YOU GUYS PUT INTO, UH, BRINGING ALL THIS STUFF INTO COMPLIANCE.

I KNOW THAT IT, IT TAKES TIME AND WE'VE HAD, COVID COME THROUGH THE MIDDLE OF IT AND WE'VE HAD ALL KINDS OF OTHER, OTHER THINGS, BUT I REALLY APPRECIATE THE WORK AND THE CONTINUED PURSUIT OF, UH, GETTING US TO WHERE WE NEED TO BE.

AND THANK YOU FOR, FOR KIND OF BEING DOGGEDLY RUNNING DOWN THIS AUDIT.

IT'S A LOT, IT'S A LOT WHEN YOU DIDN'T DO THE FIRST ONE, DIDN'T DO THE FIRST ONE.

SO I APPRECIATE IT VERY MUCH.

THANK YOU.

ANY OTHER QUESTIONS OR COMMENTS FROM COMMITTEE? OKAY, GENTLEMEN, I BELIEVE THE EXTERNAL AUDITORS ARE HERE, SO I BELIEVE, OKAY.

SO IF YOU'D LIKE TO SKIP, WE'LL SKIP BACK THEN TO ITEM NUMBER TWO, THE WEAVER PRESENTATION.

THANK YOU.

HI, WELCOME.

THIS IS PROBABLY MY LAST WEAVER PRESENTATION, A ROLL OFF FROM THE COUNCIL IN MAY.

SO IT'S OKAY.

I KNOW YOU ALL, TERRY, YOU SEEN ME NOT AT ALL.

THANK YOU.

THANK YOU FOR HAVING US TODAY AND FOR, UM, FOR WAITING ON ME.

I APPRECIATE IT.

I GOT HERE AS FAST AS I COULD.

YEAH.

ALL RIGHT.

SO WE'LL GO GET STARTED.

I'LL DO AN INTRODUCTION AND TALK THROUGH THE AUDIT PROCESS, THE AUDIT RESULTS.

AND THEN WE HAVE SOME REQUIRED COMMUNICATIONS THAT WE GO THROUGH EVERY YEAR.

UM, MY NAME IS SARAH DEMPSEY.

I'M THE AUDIT PARTNER ON THE ENGAGEMENT.

I'VE GOT ABOUT 18 YEARS OF EXPERIENCE.

IT'S ALL LOCAL GOVERNMENT, UH, EXTERNAL AUDITING.

AND THEN CLAIRE WITNESS WITH ME, SHE'S A SENIOR MANAGER IN OUR GROUP WITH 11 YEARS OF EXPERIENCE AND ALSO, UH, FOCUSES SOLELY ON LOCAL GOVERNMENT AUDIT.

SO MUNICIPALITIES IN NORTH TEXAS, UM, REALLY ALL ACROSS THE STATE.

SO WE DO A RISK BASED APPROACH.

THAT MEANS THAT WHAT WE DO WHEN WE START THE AUDIT IS WE LOOK AT WHERE MATERIALLY, THE FINANCIAL STATEMENTS COULD BE MISSTATED.

SO WE GET THE FINANCIAL STATEMENTS FROM THE CITY AND WE GO THROUGH AND WE LOOK AT HOW THE YEAR HAS GONE, WHAT HAS HAPPENED, WHETHER IT'S COVID OR, UM, A CHANGE IN THE ACCOUNTING STANDARDS OR THE CHANGE IN, UM, A COMPLEX PROCESS THAT'S GOING ON AT THE CITY.

AND WE LOOK TO SEE WHERE COULD THOSE MISSTATEMENTS, WHERE COULD THEY OCCUR? SO WE TALKED THROUGH THAT, UM, AS A TEAM WITH MANAGEMENT AND WE DO A PRESENTATION BEFORE THE AUDIT STARTS TO, IN CASE YOU HAVE ANY IDEAS AS WELL, THAT YOU'D LIKE US TO FOCUS ON.

SO SOME OF THOSE AREAS ARE THE ENTERPRISE FUND

[00:50:01]

REVENUE.

WE LOOK FOR, UM, OVERSTATING REVENUE, UM, ELECTRIC FUND, WATER AND SEWER.

WE ALSO LOOK AT GRANT REVENUES AND EXPENDITURES, ESPECIALLY LATELY WITH ALL OF THE FEDERAL MONEY COMING IN.

WE REALLY WANT TO MAKE SURE THAT IT'S BEING SPENT IN ACCORDANCE WITH THOSE, UH, FEDERAL GUIDELINES AND THEN CAPITAL PROJECTS AS THE CITY IS BUILDING AND GROWING.

WE'RE LOOKING AT THOSE CAPITAL PROJECTS, MAKING SURE THAT THE BID PROCEDURES ARE OPERATING AS DESIGNED THE PROCUREMENT PROCESS.

WE DO TRANSACTION SPECIFIC DATA MINING.

THERE'S A LOT OF RECORDS TO GO THROUGH.

SO WE'LL PUT THE DISBURSEMENT REGISTER PAYROLL REGISTER INTO A DATA ANALYTICS SOFTWARE AND LOOK FOR UNUSUAL TRENDS.

UM, AND THEN THE COMPLIANCE TESTING IS ALSO A HUGE PART OF THE AUDIT THIS YEAR.

THE, THE THRESHOLD FOR EXPENDITURES, UM, WAS ABOUT $850,000.

SO IF THE CITY SPENT MORE THAN $850,000 OF FEDERAL MONEY, WE LOOKED TO SEE IF THAT PROGRAM HAD BEEN AUDITED IN THE PAST TWO YEARS, IF IT WAS COVID MONEY, IT'S CONSIDERED HIGH RISK.

SO IT HAD TO GET SELECTED.

SO THIS YEAR WE HAD THE CORONA VIRUS RELIEF FUND, THE EMERGENCY RENTAL ASSISTANCE PROGRAM, UM, THE COMMUNITY DEVELOPMENT BLOCK GRANT, AND THEN THE IMMUNIZATION GRANTS.

SO THOSE WERE THE SINGLE AUDITS.

THAT'S QUITE A BIT, UM, YOU KNOW, USUALLY WE'RE OUT HERE AND WE'VE GOT TWO MAJOR PROGRAMS. SO TO HAVE FOUR, WE, UM, WE ASKED A LOT OF THE TEAMS, WHICH THAT IMMUNIZATION GREET AND HADN'T BEEN TESTED BEFORE FROM US.

SO THAT DEPARTMENT GOT A SURPRISE FROM US, THE SECRET.

YEAH.

AND THAT, THAT GRANT WAS VERY DIFFICULT AS WELL.

JUST THE REQUIREMENTS WITHIN THERE, UM, YOU KNOW, IS THINGS KEPT AT A CERTAIN TEMPERATURE.

YOU'RE LOOKING AT CHECKLISTS, THERE'S JUST MEDICAL RECORDS.

THERE'S A, THERE WAS A LOT TO THAT ONE THAT WAS VERY DIFFERENT.

SO WHAT WE DO IS WE GO THROUGH AND WE TEST THE INTERNAL CONTROL PROCESSES AND THEN WE TEST COMPLIANCE.

SO THAT'S WHEN WE'RE PULLING, UM, COSTS, MAKING SURE THEY'RE ALLOWABLE, UM, RENT, PAYMENTS, UM, MONITORING SUB-RECIPIENTS THINGS OF THAT NATURE.

UH, SO THIS IS A LIST OF ALL THE OTHER AREAS THAT WE TESTED.

I WON'T NECESSARILY GO THROUGH IT, BUT WE'RE LOOKING AT THE TAX REVENUE AND COLLECTIONS DEBT, UM, COMPLIANCE WITH THE PUBLIC FUNDS, INVESTMENT ACT, BOND ISSUANCES, MAKING SURE THAT THOSE ARE RECORDED CORRECTLY.

UM, THIS YEAR THE, UM, THE, THE FREEZE HAD A BIG IMPACT ON THE ELECTRIC FUND.

SO JUST GOING THROUGH AND MAKING SURE THAT THOSE TRANSACTIONS WERE ACCOUNTED FOR CORRECTLY.

SO THE AUDIT RESULTS AND UNMODIFIED OPINION ON THE FINANCIAL STATEMENTS.

SO THAT MEANS THERE'S NO MODIFICATIONS, IT'S A CLEAN OPINION, HIGHEST LEVEL OF ASSURANCE THAT WE CAN GIVE, UH, AND JUST A GREAT AUDIT, NO MATERIAL WEAKNESSES, AND NO SIGNIFICANT DEFICIENCIES WERE REPORTED, NO NONCOMPLIANCE WITHIN THE FINANCIAL STATEMENTS.

SO THIS IS, UM, JUST THE FINANCIAL STATEMENT AUDIT ALONE.

AND THEN ON THE NEXT SLIDE HERE, WE HAVE THE FEDERAL AUDITS.

SO THIS IS WHERE WE AUDITED THE CRF FUND, UM, IRAP, CDBG, AND THE IMMUNIZATION GRANTS.

AGAIN, AN UNMODIFIED OPINION.

UM, THE CITY IS CONSIDERED LOW RISK BECAUSE IT HASN'T RECEIVED MATERIAL WEAKNESSES IN THE PAST.

AND, UH, AND, UM, HASN'T BEEN, YOU KNOW, REQUIRED TO BE CONSIDERED HIGH RISK FROM A FEDERAL AGENCY.

SO THAT JUST MEANS WE ONLY HAVE TO GET 20 20% COVERAGE.

WE WENT WELL ABOVE THAT.

ANYWAY.

SO, UM, JUST BECAUSE WE HAD TO AUDIT SO MANY PROGRAMS THIS YEAR, THERE WERE NO MATERIAL WEAKNESSES IDENTIFIED DURING THOSE FOUR, UM, SINGLE AUDITS AND NO SIGNIFICANT DEFICIENCIES TO REPORT.

THAT'S, THAT'S VERY UNCOMMON, UH, ESPECIALLY WITH NEW MONEY, NEW COMPLIANCE REQUIREMENTS, THE COMPLIANCE REQUIREMENTS CAME OUT IN GRANT AGREEMENTS, BUT THEY ALSO WERE GETTING MODIFIED AS THE YEAR WENT ON.

SO IT WAS VERY HARD TO KEEP UP WITH.

IT DEFINITELY TOOK, UM, NOT ONLY DEPARTMENTS, BUT, UM, INTERNAL AUDIT FINANCE, A LOT OF PEOPLE HAD TO BE INVOLVED TO WATCH.

SO JUST THE REQUIRED COMMUNICATIONS.

NOW, UM, WE DID OUR AUDIT IN ACCORDANCE WITH GENERALLY ACCEPTED AUDITING STANDARDS.

AND THEN WE ALSO DID IT IN ACCORDANCE WITH GENERALLY ACCEPTED GOVERNMENT AUDITING STANDARDS, AS WELL AS THE UNIFORM GUIDANCE.

SO THOSE ARE THE THREE, UM, GUIDANCES THAT WE ARE USING TO, TO DIRECT OUR AUDIT.

UM, THERE WERE NO UNUSUAL TRANSACTIONS THAT TO BRING TO YOUR ATTENTION WHERE WE DIDN'T HAVE GUIDANCE.

SO EVEN THOUGH THE FREEZE WAS UNUSUAL AND THE ACCOUNTING WAS, UM, UNUSUAL, THERE IS GATSBY GUIDANCE TO GUIDE THAT TRANSACTION THAT WE WERE ABLE TO USE.

THERE WERE NEW ACCOUNTING PRONOUNCEMENTS THAT I'VE PUT UP HERE, BUT NONE OF THEM HAD A SIGNIFICANT IMPACT ON YOUR FINANCIAL STATEMENTS THIS YEAR.

SO IF YOU WERE TO TAKE YOUR PRIOR YEAR REPORT AND CURRENT YEAR, THERE WOULD NOT BE AN ENORMOUS CHANGE BECAUSE OF ACCOUNTING STANDARDS CHANGES.

[00:55:01]

THERE IS A NAME CHANGE.

SO GAS BE 98.

IT'S NOW THE ANNUAL COMPREHENSIVE FINANCIAL REPORT.

UM, SOME SAY ACT FOR, SO THERE WERE NO DIFFICULTIES ENCOUNTERED DURING THE COURSE OF THE AUDIT.

IF THERE WERE, WE WOULD BRING THOSE TO YOUR ATTENTION, BUT WE RECEIVE EVERYTHING EXTREMELY TIMELY.

THE AUDIT STARTS.

UM, THEY LET US KNOW WHEN THEY'RE GOING TO BE READY AND EVERYTHING HAS ALWAYS BEEN READY WHEN THEY SAY IT WILL.

IF WE HAVE QUESTIONS, YOU CAN TELL THAT THERE'S A LOT OF PRIDE PUT INTO GETTING THE AUDIT COMPLETED AND GETTING COMPLETED.

WELL, THEY GIVE US EVERYTHING QUICKLY.

IT'S REVIEWED, IT'S ACCURATE.

THERE'S NOT A LOT OF BACK AND FORTH OF, YOU KNOW, THIS IS INCORRECT OR THIS TH THAT DOESN'T HAPPEN.

THEY'RE VERY PREPARED FOR THE AUDIT.

SO WE APPRECIATE THAT THE AUDIT REPORT IS DATED MARCH 11TH.

AND SO THAT'S THE DAY THAT WE GET MANAGEMENT'S REPRESENTATIONS THAT THEY'VE GIVEN US EVERYTHING.

THERE'S NOTHING, UM, THAT WE SHOULD BE MADE AWARE OF THAT WOULD HAVE CHANGED THE DIRECTION OF OUR AUDIT.

WE'RE INDEPENDENT AS A FIRM AND AS AN AUDIT TEAM.

AND THEN THIS REPORT IS VERY LARGE.

IT'S NOT ALL AUDITED.

SO WE HAVE TO POINT THAT OUT.

UM, THE STATISTICAL SECTION IS VERY INTERESTING.

IT'S THE 10 YEARS OF DATA WHERE YOU CAN LOOK BACK 10 YEARS AND LOOK AT THE CURRENT YEAR AND SEE HOW MUCH IT'S CHANGED, BUT THAT IS AN AUDITED.

WE DO REVIEW IT FOR CONSISTENCY AND, UM, MAKING SURE THAT THINGS ALIGN WITH HOW OUR AUDIT PROCEDURES WENT, BUT AN AUDITED.

AND THEN THERE ARE ESTIMATES WITHIN THE AUDIT.

UM, YOU'VE GOT YOUR NET PENSION LIABILITY, YOUR OPEB LIABILITY, THOSE ARE PROVIDED BY THE ACTUARIAL REPORTS.

AND SO WE'RE LOOKING AT THOSE FOR REASONABLENESS.

AND THEN THERE ARE OTHERS INVOLVED IN THE AUDIT.

UM, WE HAVE AN IT ADVISORY GROUP.

WE HAVE INVESTMENT VALUATION THAT HAS TO OCCUR.

I'VE LISTED OUT THE ACTUARIES.

UM, AND THEN ALSO, UM, ARBITRAGE REBATE CALCULATIONS DONE BY HILLTOP.

SO MANAGEMENT IS USING SPECIALISTS THROUGHOUT THE AUDIT AND WE'RE LOOKING AT THOSE RESULTS.

AND THEN WE ALSO UTILIZE THE INTERNAL AUDIT DEPARTMENT.

UM, WHAT THEY DO IS THEY, UH, SELECT A SAMPLE OF OUR TESTS AND WE GO AND REAPER FORM A SAMPLE OF THAT SAMPLE.

SO CASH, DISBURSEMENTS, PAYROLL, AND UTILITY BILLING, UH, ONE THING THAT REALLY HIGHLIGHTS HOW GOOD OR BAD AN AUDIT IS, IS IF THERE ARE AUDIT ADJUSTMENTS.

SO THAT MEANS WE'VE RECEIVED THE FINANCIAL STATEMENTS.

AND IF THEY'RE AUDIT ADJUSTMENTS, THAT MEANS WE'RE HAVING TO CHANGE THEM.

BUT THIS DID NOT HAVE BEEN WHILE WE WERE DOING THE AUDIT.

THERE WERE NO AUDIT ADJUSTMENTS TO REPORT TO YOU AND NO PAST ADJUSTMENTS.

SO IF THERE WERE, WE WOULD BRING A LIST WITH US AND KIND OF WALK THROUGH WHAT WE HAD TO ADJUST DURING THE COURSE OF OUR AUDIT.

AND THEN THERE'S NO OTHER WRITTEN MATERIALS.

SO WE DON'T HAVE A LETTER THAT HAS ANY OTHER INFORMATION THAT WE WOULDN'T PROVIDE TO YOU.

SO EVERYTHING THAT WE'VE GIVEN THE CITY YOU HAVE AS WELL, AND THAT'S THE PRESENTATION.

SO I'M HERE TO ANSWER ANY QUESTIONS THAT YOU HAVE ABOUT THE AUDIT OR, UM, QUESTIONS ABOUT THE FINANCIAL STATEMENTS, ANY QUESTIONS ANYONE WAS THAT DON'T HAVE ANY, I MEAN, YEAR AFTER YEAR, YOU KNOW, IT'S A GREAT JOB.

IT'S THE MOST BORING OUT OF DO ALL THE TIME.

THERE WAS ONE MINOR FINDING ON SOMETHING LIKE THE REPORT NAME CHANGE.

I WAS GLAD THAT YOU GUYS WEREN'T THE ROBOTS OVER THERE.

NO, I JUST, I MEAN, I WOULD LIKE TO SAY THOUGH, YOU APPRECIATE THAT THIS WAS, UM, PROBABLY A MUCH MORE INVOLVED ON IT THAN THE PAST YEARS, BECAUSE OF, IN, IN A LOT MORE, I DON'T WANT TO SAY NECESSARILY COMPLICATED, BUT, BUT KINDA BECAUSE WE HAVE NEW PROGRAMS THAT, THAT, THAT HAVE NEVER BEEN TESTED BEFORE.

AND, AND SO YOU, YOU ACTUALLY HAVE TO KIND OF REINVENT THE WHEEL OF LIKE, HOW ARE WE EVEN GOING TO AUDIT THIS NEW PROGRAM THAT DOESN'T EXIST IN, IN, BUT ALSO TO THAT POINT, I WANT TO THANK STAFF AND THE CITY MANAGER AND, AND, AND ALL OF OUR STAFF ON THE FINANCIAL SIDE, BECAUSE THESE ARE TAKE, TAKE NEW PROGRAMS. I MEAN, THESE PROGRAMS WERE COMING FAST.

IT WAS LIKE, YOU KNOW, HERE'S THIS ONE AND HERE'S THIS OTHER ONE.

AND THAT WERE, YOU KNOW, AND THEY ALL HAD, I JUST, I DON'T KNOW HOW YOU DO IT, A CRAZY AMOUNT OF REQUIREMENTS AND TRYING TO FIGURE OUT THE PUZZLE AND EVERYTHING.

SO TO HAVE, YOU KNOW, TO HAVE COMPLETELY NAVIGATED ALL OF THESE THINGS, THESE DIFFERENT PROGRAMS, AND TO COME OUT ON THE OTHER SIDE WITH NOT A SINGLE, YOU KNOW, WE'RE NOT, WE'RE NOT UNDAUNTING ANY OF THE EYES ARE CHANGING, IS, UM, THAT'S TRULY IMPRESSIVE.

AND SO I JUST, I, I, I HOPE, I HOPE THAT MESSAGE GETS THROUGH TO EVERYONE.

I KNOW IT WAS A BIG JOB ACROSS ALL STAFF.

THESE WERE HEAVY LIFTS TO DEAL WITH THESE PROGRAMS IN, UH, IN ALL OF COVID WAS, BUT, BUT

[01:00:01]

PARTICULARLY THIS KIND OF STUFF, YOU KNOW, DEALING WITH ALL THESE NEW AND DIFFERENT MONIES.

AND SO I'M, I'M VERY PROUD OF THE, OF THE CITY AND OF OUR STAFF AND THE WAY YOU ALL HANDLED IT.

UM, CHAIRMAN, IF I COULD, UM, YOU'RE, YOU'RE WELL AWARE OF, OF MATT WATSON AND HIS GREAT WORK FOR THE CITY, BUT THERE'S ANOTHER PERSON HERE WHO IS VERY, VERY MUCH BEHIND THE SCENES AND NEVER GETS THE RECOGNITION SHE DESERVES.

UH, MS. RICHIE, WOULD YOU PLEASE SAY HI TO EVERYONE? UM, SHE IS, UH, UH, IS IT CORRECT TO CALL HER THE ROCK OR THE FOUNDER OF THE FINANCE DEPARTMENT? AND, UH, SHE, SHE DOES AN EXCELLENT JOB, UH, BUT IS ALWAYS IN THE SHADOWS AND NEVER GETS THE CREDIT SHE DESERVES.

WELL, THANK YOU VERY MUCH ON BEHALF OF ALL OF THE CITIZENS OF GARLAND, ALL THE RESIDENTS OF GARLAND, WE APPRECIATE EVERYBODY'S WORK ON, ON THIS AND ON ALL THE PROGRAMS AND ON MAKING SURE THAT WE'RE ACCOUNTABLE TO THEM.

I MEAN, THAT'S, IT'S, IT'S SO IMPORTANT TO ENSURE THAT PUBLIC TRUST ON PROGRAMS LIKE THIS INSIDE OF MANY.

WE APPRECIATE EVERYONE'S HARD WORK.

THANK YOU.

ARE YOU, ARE YOU READY FOR THE, YES.

I DUNNO.

IN BOXING TERMS, IS THIS CONSIDERED LIKE THE MAIN EVENT OR SOMETHING? I DON'T KNOW.

WE HAVE A LOT OF PEOPLE HERE JUST FOR THIS PART.

UM, THE BOND PROGRAM CHAIRMAN, IF I MAY AUDIT, UH, AS, AS THE COMMITTEE'S AWARE, WE DID AN AUDIT IN END OF LAST YEAR AND ISSUED THE REPORT TO THE AUDIT COMMITTEE ON DECEMBER, 2021, SINCE THEN CITY ADMINISTRATION, PROJECT MANAGEMENT OFFICE, AS WELL AS E-COM HAS BEEN WORKING ON IMPLEMENTING SOME OF THE RECOMMENDATIONS.

AND WE HAD A VERY GOOD MEETING LAST WEEK.

SO I'M GOING TO TURN IT OVER TO JED.

UM, SEAN AND STEVEN, UM, TO KIND OF GO OVER AND THE LEGAL DEPARTMENT WAS VERY INVOLVED TOO.

SO MAKE ME TAKE THE CENTER SEAT.

THANK YOU VERY RIGHT.

YOU'RE TRAPPED, STEVE.

SORRY.

UH, JED.

THANK YOU, MR. CHAIR, COMMITTEE MEMBERS.

UM, I'LL JUST GIVE A BRIEF INTRO AND THEN LET THE HEAVY HITTERS TAKE OVER AND KIND OF SHARE WHAT'S BEEN GOING ON OVER THE PAST FEW MONTHS.

UH, YOU RECALL THAT, UH, YOU KNOW, BACK AROUND DECEMBER, JANUARY, WHEN THIS WENT TO COUNCIL, UH, WE WERE, UH, GIVEN THE OPPORTUNITY TO REALLY, TO PEEL BACK THE LAYERS OF OUR, BOTH OUR PROCESS AND OUR CONTRACTS, UH, RELATED TO OUR PAY APPLICATIONS AND THE, UH, CONTRACTS THAT WE HAVE, UH, WITH OUR CONSTRUCTION MANAGERS AT RISK AND ALSO WITH OUR ARCHITECTS AND ENGINEERS.

AND SO WHAT YOU'LL HEAR, UH, THIS AFTERNOON IS AN UPDATE FROM, UH, SEAN GASPER, RICH WITH A E-COM, UH, HE HEADS UP OUR BOND PROGRAM EFFORTS THERE.

AND SO HE'LL TALK ABOUT, UH, THE PROCESS THAT, UH, IS GOING TO BE PUT IN PLACE FOR REVIEWING THOSE PAY APPLICATIONS, UH, AND SPECIFICALLY, UH, SOME CHANGES THAT WE WERE MAKING THERE.

UM, AND THEN, UH, STEVE HINES WITH OUR CITY ATTORNEY'S OFFICE IS GOING TO TOUCH ON THE CONTRACTS, UH, BOTH WITH OUR CMRS AND WITH OUR ARCHITECTS, ENGINEERS, THE DESIGN PROFESSIONALS THAT WE WORK WITH ON THESE BOND PROJECTS.

UM, SO, UH, WE'RE, WE'RE, WE'VE COME A LONG WAYS OVER THE LAST FEW MONTHS AND STILL YOU'LL, YOU'LL HEAR SOME NEW THINGS THAT, UH, MAYBE WEREN'T IN THE PICTURE, UH, WHEN WE STARTED ON THIS BOND AUDIT, I'M SO GRATEFUL FOR THE OPPORTUNITY TO REALLY PEEL BACK THE ONION LAYERS AND GET TO THE CORE ISSUES THAT ARE HERE, UM, SO THAT WE CAN KEEP THIS PROGRAM MOVING FORWARD AND KEEP GARLAND MOVING FORWARD.

SO WITH THAT, SEAN, I TURN IT OVER TO YOU.

SURE.

AND I SHOULD HAVE BET ADVANCED THE SLIDE THERE WHILE JED WAS TALKING IS I THINK WE TOUCHED ON, HE TOUCHED ON MOST OF THE THINGS THAT ARE ON THAT LIST, UH, IN FRONT OF YOU.

THAT'S REALLY OUR TABLE OF CONTENTS FOR TODAY.

UM, BACKING UP TO DECEMBER AND WHAT OUR EFFORTS HAVE BEEN IN TERMS OF, UH, YOU KNOW, PERCENT OF THE COSTS THAT ARE SUPPORTED FROM OUR TWO CMRS