City of Richmond -Corrective Action Plan
Recommendation
Number Description Responsible for
Implementation Time Frame Corrective Action Plan May 2023 Update June 2023 Supplemental Update November 2023 Update 1 To help ensure that Richmond maintains appropriate reserves for times of fiscal uncertainty, city staff should, by June 2023, review Richmond's reserve policy to determine whether a higher reserve target is appropriate. As part of the review, staff should consider all the factors the Government Finance Officers' Association (GFOA) recommends for setting a reserve target. Once that review is complete, city staff should present proposals to the city council for modifying the city's policy.
City Manager Office
&
Finance
6/30/2023
Schedule City Council review/consideration of updated General Fund reserve policy in March 2023 for implementation in the Fiscal Year (FY) 2023-2024 Budget, for adoption by June 2023.
Staff will be presenting GFOA best practices to the
City Council on May 2, 2023, with the first draft
budget for FY23-24
Staff presented GFOA best practices to the City
Council on May 2, 2023, with the first draft
budget for FY23-24. Based on the GFOA best
practices, on June 27, 2023, the City Council
adopted a revised Cash Reserve Policy (see
Attached, Cash Reserve Policy)
Completed per June 2023 supplemental update.
2 To decrease the risk that Richmond will deplete its reserves, city staff should, by June 2023, present to the city council a list of proposed budget actions that would help ensure balanced budgets and eliminate projected deficits.
City Manager Office
&
Finance
6/30/2023
Present contingent, long-term budget balancing options with the FY 2023-2024 proposed budget, by June 2023.
Staff will be presenting the first draft of the FY23-24 budget on May 2, 2023, to achieve a balance budget
by June 30, 2023
The City Council adopted a balanced budget for
Fiscal Year 2023-2024 on June 20, 2023 (see
Attached Fiscal Year 2023-2024 Budget Staff Report)
Completed per June 2023 supplemental update.
3 Richmond should include multiple scenarios in its financial projections, including scenarios with potential additional risks, such as economic downturns or recessions, and how the city would continue to fund its operations under those circumstances.
City Manager Office
&
Finance
On Going
Present expanded 5-year financial projection with the FY 2023-2024 Proposed Budget, by June 2023.
Staff will present a draft five-year forecast (with
scenarios) to the City Council on May 16, 2023, for
review and discussion.
The City staff presented a multiple scenarios forecast
to the City Council on June 6, 2023. (see Attached
staff report that the City Council received the Five
Year Forecast)
Completed per June 2023 supplemental update.
4 To ensure that Richmond is able to fund its retirement-related costs, city staff should, by June 2023, propose to the city council a specific policy regarding funding of its pension trust fund for this purpose. Staff should report to the city council on estimated long-term savings from increasing its direct payments to Cal PERS compared to investing the same amounts in its pension trust fund. Staff members should use this information to inform their recommendations related to funding targets for the pension trust fund and should consider recommending that the council increase the city's payments directly to CalPERS.
City Manager Office
&
Finance
6/30/2023
Schedule City Council review/consideration of updated Pension funding policy in March 2023 for implementation in the FY 2023-2024 Budget, for adoption by June 2023.
The City has contracted with GovInvest to keep an
on-going monitoring of the retirement related costs
and impact of funding initiatives. First presentation to the City Council is expected on May 16, 2023
GovInvest presented a Pension Funding PowerPoint
presentation at the May 16, 2023, City Council
meeting and NHA Advisors presented a PowerPoint
presentation on CalPERS Unfunded Accrued Liability
Cost Management Strategies at the June 6, 2023,
City Council meeting. Based on these presentations
the City Council adopted a new Pension Funding
Policy. (see Attached Pension Funding Policy)
Completed per June 2023 supplemental update.
5 To improve the city's ability to pay other post-employment benefits, Richmond should, by June 2023 and annually thereafter, implement a policy identifying funds, such as surpluses or one-time revenues that should be contributed to the OPEB trust fund. Staff should conduct an annual analysis to determine whether any funds available to the city are applicable under the city's policy and should present a proposal to the city council to apply those funds to the trust fund.
City Manager Office
&
Finance
6/30/2023
Schedule City Council review/consideration of updated OPEB funding policy in March 2023 for implementation in the FY 2023-2024 Budget, for adoption by June 2023.
City staff will be presenting options to the City
Council regarding OPEB-Prefunding on May 16,
2023
On June 27, 2023, City Council adopted a revised
OPEB Funding policy. (see Attached OPEB funding
Policy)
Completed per June 2023 supplemental update.
6 To mitigate the costs of increasing salaries, the city should perform a workforce analysis by June 2024. Based on the results of the analysis, the city council should consider eliminating vacant positions that it deems no longer necessary. Additionally, the city should assess its need for each vacant position before it seeks to fill the positions and eliminate any positions that it does not need.
City Manager Office
&
Human Resources
6/30/2024
The City is issuing a Request for Proposal for a professional firm to conduct a formal workforce analysis. While the City evaluates the professional firms that replied to the Request for Proposal, the City will do an annual analysis of funded positions proposed by departments during the annual budget process, starting with the FY 2023-24 budget, by June 2023.
City staff will be presenting results of an RFP to
perform a workforce analysis to the City Council on
May 2, 2023.
Staff originally brought the results of the RFP to
perform a workforce analysis to the City Council on
May 2, 2023. Due to the large volume of agenda
items, the RFP was awarded to Raftelis to perform
the Workforce Analysis and the contract was
approved by the City Council on May 23, 2023.
Raftelis has started the workforce analysis, in
the first phase of the analysis, several
department and division heads were interviewed
to assess the current state of workload and
staffing levels. The study will be concluded
before June 30, 2024.
7 To ensure compliance with federal requirements, Richmond should dedicate the resources necessary to provide records needed for an independent auditor to complete all outstanding single audits of the housing authority within the next fiscal year. To comply with existing legal obligations, Richmond should make available sufficient resources to enable the Housing authority to resolve all past due requirements of the recovery agreement and to meet the remaining deadlines in a timely manner by January 2024.
City Manager Office
&
Richmond Housing
Authority
1/1/2024
Identify and assign resources to complete Housing Authority Single Audit backlog by June 30, 2023. Identify and assign resources to complete Housing Authority Recovery Agreement actions by January 2024.
The City has made the following resources available
to RHA: Senior Accountant, Outside Consultant,
Accountant I, Interim Director Housing Authority.
Please see recommendation number 8 supplemental
update below.
Completed per June 2023 supplemental update.
8 To define Richmond's responsibility related to the housing authority, Richmond should immediately enter into a written agreement with the housing authority defining each entity's financial responsibilities and draft plans to resolve past tax liabilities and prevent unnecessary new liabilities.
City Manager Office
&
Richmond Housing
Authority
2/28/2023
Draft and Schedule City Council consideration of Housing Authority Administration Agreement by February 2023.
The City and RHA are in process of preparing a draft
written agreement regarding tax liabilities and
prevention of unnecessary new liabilities.
On June 27, 2023, City Council approved a written
agreement between the City and the Richmond
Housing Authority. (see Attached, Richmond Housing
Authority & City Administrative Services Agreement)
Completed per June 2023 supplemental update.
9 To ensure that Richmond is receiving the best value when entering into contracts, city staff should immediately begin documenting that they are following the contracting requirements in the city's municipal code and contracting policies for all contracts. City Manager Office &
Finance
6/30/2023
Draft and implement Contract Compliance Documentation processes by June 2023.
City staff conducted an assessment of training
materials to ensure compliance with contracting
requirements in the City's Municipal Code and
contracting policies. Staff prepared training
programs to help employees develop the knowledge
and skills to ensure compliance. [See Attached pdf
Contract Compliance Training]
See May 2023 update. Completed per June 2023 supplemental update. 10 To reduce potential errors and omissions by city staff members when contracting for goods and services, by January 2023 Richmond should require its finance department to create a comprehensive checklist of required documentation for contract files that other departments must follow when conducting procurements.
City Manager Office
&
Finance
6/30/2023
Draft and implement Contract Compliance Checklist by June 2023. City staff compiled comprehensive checklists that are being utilized in reviewing and approving all contracts to ensure that proper procurement procedures and
adherence to applicable City policies is being
followed. [See Attached pdf Contract Compliance
Checklists].
See May 2023 update. Completed per May 2023 update.
11 To ensure that city fees appropriately cover the cost of providing services, by June 2023, Richmond should determine a cost-effective frequency for updating its fee schedule to reflect all allowable costs, including adjusting fees for inflation as appropriate. Richmond should then revise its municipal code as necessary.
City Manager Office
&
Finance
6/30/2023
Review and update the Fee Schedule policy for City Council consideration and update of Municipal Code as needed by June 2023.
City staff will be providing the City Council with the
revised Ordinance on May 2, 2023, to update the
Master fee schedule to annually (rather than
quarterly).
On June 6, 2023, the City Council adopted an
ordinance revising the Master Fee Schedule to
annually (rather than quarterly) (see Attached revised
ordinance).
Completed per June 2023 supplemental update.
Attachment 1 - State Auditor's Recommendations -Corrective Action Plan, Supplemental Update November 2023