Quarterly Audit and Performance
Review Report
FY 2024-25, Q3
June 10, 2025
Nancy L. Hom
Chief Financial Officer and AGM, Business Services
1 FY 2024-25 Audit Plan Status
Audits and Assessments to Date
Status Count
Completed 19
In Progress 9
Upcoming 11
Total 39
2 Completed In Progress Upcoming
Q3 Audits Completed and Reports Issued
Audit / Assessment Oversight Body Report
Date
Public Integrity Assessment: Status of City
Contracts With Rudolph Dwayne Jones
Controller’s Office, City
Services Auditor 3/11/2025
Citywide Management of Conflicts of Interest
Audit
Board Of Supervisors,
Budget and Legislative
Analyst
3/24/2025
3 4
Spotlight: Status of City Contracts With Rudolph
Dwayne Jones Public Integrity Assessment
Controller’s Office, City Services Auditor
• Conducted as part of a series of public integrity assessments focused on contracts, purchase orders, and grants
Background and Overview
• Rudolph Dwayne Jones (RDJ) was criminally charged in August 2023 by the Office of the District Attorney with bribing a former employee of the Office of the City Administrator to secure city contracts and grants. • Multiple city departments affected by the alleged criminal conduct. • All findings and recommendations were directly towards the Human Rights Commission, the Office of Economic Workforce Development, the Office of Contracts Administration, and the Controller’s Office Systems Division.
Spotlight: Status of City Contracts With Rudolph
Dwayne Jones Public Integrity Assessment (cont’d)
Highlighted Internal Control Deficiencies (Citywide)
1. Lack of compliance to City financial and procurement policies related to Conflicts of Interest / Incompatible Activities, management review and approvals, supportive documentation, and proper use of the City’s financial management system.
2. Lack of program oversight, and fiscal and program monitoring.
3. Lack / inadequate use of City’s financial and procurement system to monitor sub-grant awards and payments in the system.
* * * * *
San Francisco Public Utilities Commission
No findings attributed to the SFPUC.
In September 2023, the SFPUC directed prime contractors to terminate all contracts with RDJ as subcontractor. No active contracts exist.
5 Recommendations Tracking
6 # Audit Title
Report
Issued
Date
Open
Rec
Total
Rec
Months
Open
%
Complete
Close
Date
(or Target)
Revenue Lease Audit: Crystal Springs Golf Partners, LP
1 Crystal Springs Golf Partners, L.P., Paid Rent Owed for 2019 Through 2021, but a Few Improvements Can Strengthen
SFPUC’s Lease Administration
3/9/2023 0 8 16 100% 7/10/2024
Revenue Bond Oversight Audit, Phase II
2 The San Francisco Public Utilities Commission Spent Revenue Bond Funds for Allowable Purposes but Should Strengthen Its Compliance and Monitoring Controls
9/5/2023 0 3 10 100% 7/10/2024
Public Integrity Assessment: Procurement
3 Criminal Conduct by Former San Francisco Public Utilities Commission General Manager Harlan Kelly Undermined the
Integrity of City Procurements Despite Existing Rules
Governing Gifts, Disclosures, and Sole Source Waivers
3/27/2024 2 2 12 0% 11/31/2025
Chapter 6 Delegated Authority Audit
4 Performance Audit of the Authority Delegated to the San Francisco Public Utilities Commission for Public Works
Contracts Under Chapter 6 of the Administrative Code
12/20/2024 14 14 3 0% 1/1/2026
Total 16 27 41%
7 FY 2024-25, Q4 Outlook
Completing
• BOS Budget & Legislative Analyst, Management of
Interdepartmental Services Audit
• Revenue Bond Audit Phase 3
• FY 2023-24 Single Audit
• FY 2023-24 Wholesale Revenue Requirement: Statement of Changes in Balancing Account
8 FY 2024-25, Q4 Outlook (Cont.)
Upcoming
• CleanPowerSF Independent Privacy Audit
• CY 2024 Post Audit
• FY 2024-25 Annual Physical Inventory Counts
• FY 2024-25 Interim Financial Statements
• TIDA Costs Reconciliation
THANK YOU
Feedback & Questions?
9 OUR MISSION: To provide our customers with high-quality, efficient and reliable water, power and sewer services in a manner that values environmental and community interests and sustains the resources entrusted to our care.
BUSINESS SERVICES BUREAU
525 Golden Gate Avenue, 13th Floor
San Francisco, CA 94102
T 415.934.5707
F 415.554.1877
Date: June 10, 2025
To: Commissioner Kate H. Stacy, President
Commissioner Joshua Arce, Vice President
Commissioner Avni Jamdar
Commissioner Steve Leveroni
Commissioner Meghan Thurlow
Through: Dennis J. Herrera, General Manager
From: Nancy L. Hom, Chief Financial Officer and Assistant General Manager, Business Services
Subject: FY 2024-25 Q3 Audit and Performance Review Report This memorandum summarizes the San Francisco Public Utilities Commission (SFPUC) Quarterly Audit and Performance Review (QAPR) report for the third quarter of FY 2024-25, ending March 31, 2025.
I. Completed Audits
There were two completed audits during the third quarter of FY 2024-25:
1. Public Integrity Assessment: Status of City Contracts | March 11, 2025 Report Link: https://tinyurl.com/526fafws
Report Summary: In August 2023 the Office of the District Attorney criminally charged Rudolph Dwayne Jones with bribing a former employee of the Office of the City Administrator, Lanita Henriquez, to secure city contracts and grants through the Community Challenge Grant program. The criminal conduct allegedly occurred from July 1, 2016, through July 1, 2020. As part of a series of assessments concerned with public integrity, the Controller’s Office, in conjunction with the City Attorney’s Office, assessed:
City funds provided to Rudolph Dwayne Jones and companies and nonprofit organizations related to him going back to 2016 City funds paid to a nonprofit organization founded by Jones in 2012 that was not suspended, Urban Ed Academy Inc. (UEA)
Audit Findings Summary: In response to a September 7, 2023, directive from the Mayor, City Administrator, City Attorney, and Controller, SFPUC provided a memo to the effect that it had terminated all contracts with RDJ as a prime contractor or subcontractor. All Social Impact Partnership funding to Jones-related entities has been expended, and there are no new SFPUC contracts that include SIP funding commitments to any of these entities
2. Citywide Management of Conflicts of Interest Audit | March 24, 2025 Report Link: https://tinyurl.com/55jssp26
Report Summary: The Board of Supervisors’ Budget and Legislative Analyst’s Office conducted a performance audit of how conflicts of interest are managed citywide. This project included an assessment of the City’s approach to minimizing conflicts of interest among public officials, staff, and contractors, with a review of citywide training and communications, department controls around contracting, practices for filing and reviewing statements of economic interests (Form 700), a review of departments’ statements of incompatible activities including oversight of secondary employment, and surveys of both City departments and other jurisdictions.
Audit Findings Summary: Although conflict-of-interest attestations are generally required by departments for panelists when a formal selection panel is convened, the auditors found that City departments were unable to provide attestation forms for 16 of 37 sampled contracts (43 percent) that were awarded with such panels. Various explanations were provided by different departments, with SFPUC staff noting that during the time covered by the contract sample, panels convened by a specific division and separately those awarding “low-bid” contracts were not required to complete attestation forms. At this time, all SFPUC staff involved in development, administration, or evaluation of a procurement sign an acknowledgement of impartiality/confidentiality form.
II. Audit Recommendation Status
As of 3/31/25, 2 audit recommendations were open for the Procurements Public Integrity Assessment and 14 were open for the Chapter 6 Delegated Authority Audit.
If you have questions, please contact me at [email protected] or Irella Blackwood, Audit Director, at [email protected].
cc: Irella Blackwood, Audit Director
att: FY 2024-25 QAPR Audit Plan, By Status
# Quarter Status Audit Type Enterprise /
Bureau Audit Name Oversight Body
1-5
Completed Financial Water
Annual Physical Inventory Count, FY 2023-24 SFPUC, Finance Completed Financial Wastewater Completed Financial Hetch Hetchy
Water & Power
6 Completed Financial
Business
Services,
Finance
Post Audit, CY 2023 Controller
7 Completed Financial
Business
Services,
Finance
Wholesale Revenue Requirement: Statement of
Changes in Balancing Account, FY 2022-23 BAWSCA
8 Completed Financial Power Franchise Fee Audit: Energy Center SF LLC Controller 9 Completed Financial Power Franchise Fee Audit: Pacific Gas & Electric Company Controller 10 Completed Financial Water
Audited Financial Statements, FY 2023-24 Controller 11 Completed Financial Wastewater 12 Completed Financial
Hetch Hetchy
Water & Power
&
CleanPowerSF
13 Completed Financial
Business
Services,
Finance
Annual Comprehensive Financial Report, FY 2023-24 SFPUC 14 Completed Financial
Business
Services,
Finance
Popular Annual Financial Report, FY 2023-24 SFPUC
15 In Progress Financial
Business
Services,
Finance
Single Audit, FY 2023-24 OMB
16 [Updated]
Financial
Business
Services,
Finance
Wholesale Revenue Requirement: Statement of
Changes in Balancing Account, FY 2023-24 BAWSCA
In Progress
17 Upcoming Financial
Business
Services,
Finance
Post Audit, CY 2024 Controller
18 Upcoming Financial Water
Interim Financial Statements, FY 2024-25 Controller 19 Upcoming Financial Wastewater 20 Upcoming Financial
Hetch Hetchy
Water & Power
&
CleanPowerSF
Quarterly Audit & Performance Review Report
FY 2024-25 Audit Plan, By Status
As of March 31, 2024
Status
Completed: 19
In Progress: 9
Upcoming: 11
Total: 39
# Quarter
Status Audit Type Enterprise /
Bureau Audit Name Oversight Body
21-
25 Upcoming Financial Water
Annual Physical Inventory Count, FY 2024-25 SFPUC, Finance Upcoming Financial Wastewater Upcoming Financial Hetch Hetchy
Water & Power
26 [Updated]
Financial
Business
Services,
Finance
TIDA Costs Reconciliation SFPUC
Upcoming
27 Completed Performance Hetch Hetchy
Water & Power Cybersecurity Maturity Assessment, FY 2023-24 SFPUC 28 Completed Performance All SFPUC SFPUC Chapter 6 Delegated Authority Audit BOS 29 Completed Performance Hetch Hetchy
Water & Power EPA Cybersecurity Guidelines Self-Assessment SFPUC 30 [Updated]
Performance
Human
Resources
Services
Public Integrity Assessment: Status of City Contracts CSA, Controller Completed
31 [Updated]
Performance
Human
Resources
Services
Citywide Management of Conflicts of Interest Audit BOS
Completed
32 In Progress Performance All SFPUC Management of Interdepartmental Services Audit BOS 33 In Progress Performance
Human
Resources
Services
Citywide Payroll Audit CSA, Controller
34 In Progress Performance
Human
Resources
Services
COVID-19 Emergency Procurement Audit CSA, Controller
35 In Progress Performance Infrastructure FY 2024-25 Construction Close-Out Audit: Sunol Long Term Improvements - Corporation Yard CSA, Controller
36 [Updated]
In Progress
Performance
Customer
Services
Bureau
Customer Assistance Program and SuperGreen Saver
Post-Enrollment Verification SFPUC
37 Upcoming Performance CleanPowerSF CleanPowerSF Independent Privacy Audit SFPUC 38 In Progress
Concessions, Real Estate
Services Revenue Lease Audit: Mission Valley Rock CSA, Controller Lease Revenue
39 In Progress
Revenue Bond Business
Services,
Finance
SFPUC Revenue Bond Programs Audit: Phase III CSA, Controller Oversight