City Council
FY23-25 Biennial Budget
(Study Session)
May 30, 2023
Courtney Ruby CPA, CFE
City Auditor
Michael Houston, MPP , CIA
Assistant City Auditor
Independent City Auditor . Serving Oakland With Integrity.
Mission
Statement
To conduct performance audits
and investigations that return in-
depth and meaningful results to
the residents of Oakland by
identifying, auditing and
investigating areas of
government most vulnerable to
mismanagement, fraud, waste,
and abuse.
Office of the City Auditor
Independent City Auditor . Serving Oakland With Integrity.5/16/2022 Office of the City Auditor Vision
To serve the public with the utmost integrity while upholding the highest standards of performance and professionalism with a driving commitment to dig deeper and produce impactful work that underpins the effective, efficient, and ethical operations of city government.
Value
We value our independence. As an elected City Auditor, we operate independently to protect the public’s resources free of influences allowing us to act with integrity and exercise objectivity.
Vision and Value
Statements
Independent City Auditor . Serving Oakland With Integrity.5/16/2022 Office of the City Auditor The City Auditor has the power and duty to:
• To conduct surveys, reviews, and performance audits and financial audits as the Auditor deems to be in the best public interest or as requested by the Council or Mayor.
• Conduct audits in accordance with Government Auditing Standards as issued by the U.S. Comptroller General.
• Ascertaining compliance with Council’s resolutions and policies and the Mayor’s Administrative Instructions and Directives, as well as applicable State and Federal laws and regulations.
• Review and recommend to the City Administrator & Management adjustments in operating and administrative procedures and practices, internal systems and internal management controls.
Highlights of the City Auditor’s
Role & Responsibilities
Section 403 of the City Charter
Independent City Auditor . Serving Oakland With Integrity.5/16/2022 Office of the City Auditor • Analyze allegations of fraud, waste, abuse or illegal acts that require further investigation to substantiate.
• Analyze City programs, activities, services, functions, policies, etc. as to the effectiveness and cost-effectiveness, including identifying any causes of inefficiencies.
• Prepare impartial financial analyses of all ballot measures, pursuant to the provisions of the Municipal Code.
• Respond to requests from the City Administrator to provide recommendations on how to make City departments and services more effective and customer-service oriented.
Highlights of the City Auditor’s
Role & Responsibilities
Section 403 of the City Charter
Independent City Auditor . Serving Oakland With Integrity.5/16/2022 Office of the City Auditor ✓ Conducting risk-based audits.
✓ Conducting mandated audits.
✓ Conducting whistleblower
investigations.
✓ Completing ballot analyses.
✓ Undergoing peer reviews every
three years.
✓ Meeting regularly with residents
and community organizations.
How Does My Office Fulfill Its
Mission And Goals?
✓ Communicating audit and
investigation results widely to the
community.
✓ Publishing annual reports
summarizing recent audits,
investigations and recommendations.
✓ Preparing an annual workplan
including planned audits for the year
and publishing such workplan in
August of each year.
Independent City Auditor . Serving Oakland With Integrity.5/16/2022 Office of the City Auditor ✓ Publishing annual reports
• Summarizing recent audits and
recommendations
• Summarizing annual Whistleblower
Hotline activity
✓ Publishing annual recommendation
follow-up report
✓ Preparing a Strategic Plan
✓ Publishing Annual Workplan
The Measures in Place to Assess
How Effectively We are Delivering
on This Mission
✓ Calculating impact at the completion of
an audit
• Quantify Economic Impact
• Race & Equity Impact
✓ Conducting Surveys
• Ethical Climate Survey
• Whistleblower Hotline Survey
✓ Undergoing Peer Reviews (every 3 years)
Independent City Auditor . Serving Oakland With Integrity.5/16/2022 Office of the City Auditor The passing of Measure X increased the Office of the City Auditor’s staff size by 3 FTEs. These new positions will be included in our Office’s minimum staffing level per the City Charter as of July 1, 2023.
The passing of Measure X was critical as the City Auditor’s Office has been budget constrained for over 17 years as documented in legal opinions rendered by the City Attorney in 2006 and again in 2010. Both legal opinions confirmed budget cuts would impair the City Auditor’s Office from meeting its Charter mandated duties.
Impact of Measure X on the
City Auditor’s Budget Proposal
Position *Fully Loaded - On-Going $ Change
Performance Audit Manager $293,498
Senior Performance Auditor $229,952
Performance Auditor $180,198
Total $703,648
Independent City Auditor . Serving Oakland With Integrity.5/16/2022 Office of the City Auditor
HIGH-LEVEL PROPOSAL SUMMARY
Per the City Charter, the recent passage of Measure X mandated the Office of the City Auditor to maintain a minimum staffing level of 14 FTEs.
Accordingly, our budget proposal included the 3 additional FTEs to meet the minimum staffing level and related personnel costs.
High-level Budget Proposal Summary
Independent City Auditor . Serving Oakland With Integrity.5/16/2022 Office of the City Auditor Top Budget Priorities
Increase our staffing size from 11 to 14 FTEs to comply with Measure X
Independent City Auditor . Serving Oakland With Integrity.5/16/2022 Office of the City Auditor Top Budget Priorities
Increase our operations and management funds to cover
additional training and equipment costs and improve
whistleblower interface to track equity outcomes
Additional O&M Costs One-time $ Change Ongoing $ Change Whistleblower Program (WB) technical
interface
(expanding the tracking capacity of our
WB Program to quantify equity outcomes)
$5,000 (FY 23-24) $600
IT equipment
(for new staff) $27,000 (FY 23-24)
Training expenses/membership dues
(for new staff) $12,000
Independent City Auditor . Serving Oakland With Integrity.5/16/2022 Office of the City Auditor Measure X states the City Council may suspend the minimum staffing level for a fiscal year or two-year budget cycle, in the event of extreme fiscal necessity. As such, the Administration’s Proposed Budget includes 1 of 3 mandated positions:
Impact of Administration’s Proposed 2023-25
Biennial Budget on our Office’s ability to
deliver on our oversight mandate
Position *Fully Loaded - On-Going $ Change
Performance Audit Manager $293,498
Senior Performance Auditor $229,952
Performance Auditor $180,198
Total $703,648
Independent City Auditor . Serving Oakland With Integrity.5/16/2022 Office of the City Auditor The impacts of funding only 1 position are the following:
✓ reduces our ability to complete mandated audits timely, ✓ reduces our capacity to complete more high-risk departmental or programmatic performance audits,
✓ reduces our capacity to respond to City Council requests, including audits, timely,
✓ hinders our ability to follow-up timely on outstanding audit recommendations, and
✓ decreases our capacity to meet the growing demands of the Whistleblower Program.
Impact of Administration’s Proposed 2023-25
Biennial Budget on our Office’s ability to
deliver on our oversight mandate
QUESTIONS?