Chief Administrator 2021 Audit Status Report

Information
We are tracking four audits that made 20 recommendations to the Chief Administrative Officer. Two audits addressed the renovation of the Portland Building, one involved homeless camp cleanups, and one assessed City-issued credit card use.
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Elected-in-charge: Mayor Ted Wheeler
Bureau or Office Director: Chief Administrative Officer Tom Rinehart


We are tracking four reports and 20 recommendations

Recommendations

The Chief Administrative Office had 10 implemented recommendations, seven in process recommendations, one not implemented recommendation, and two pending recommendations that we have not yet followed-up on because they were less than a year old.

The Chief Administrator had 10 recommendations implemented, 7 in process, and 1 not implemented. Two were pending because we have not followed-up on them yet.

Most of the recommendations are internally focused and suggest procedures to tighten up construction and credit card use monitoring. However, the homeless camp clean-up recommendations involve a high-priority issue of public concern. We will follow up on the two recommendations from the 2021 credit card use audit in 2022.

Highlight from Last Year
We recommended that the Homelessness and Urban Camping Impact Reduction Program use data to analyze and improve the effectiveness of cleanups. The program is now using system data to adapt to changing conditions caused by the pandemic. Improved data allows the program to be more responsive to requests for information from policy makers.

To Do
We recommended that the Homelessness and Urban Camping Impact Reduction Program establish systems to improve data quality and reduce manual processes. The program worked with the Bureau of Technology Services to develop a web application which is now largely implemented. The last step will be to set up contractors to report conditions in the field. Once the web application is complete, people filing complaints will be able to check report status online.


Portland Building Reconstruction: City faced with important post-planning decisions to ensure project success

Report published December 29, 2016 | Follow-up report | Contact Tenzin Gonta

The City decided to renovate the iconic Portland Building in 2015. We identified risks during early renovation planning in 2016. Three years later, we highlighted unresolved issues the City had time to address. The City implemented the recommendations related to equity grants last year, but other improvements remained underway. Because of the pandemic, the Portland Building is still not yet open to the public and there is little use by City employees. This year, we found the City did not implement our budget transparency recommendation but made progress in its compliance with the Americans with Disabilities Act and historic preservation requirements. 

On this audit there were two recommendations implemented, two in process, one not implemented, and none pending.

On this audit, there were two recommendations implemented, two in process, one not implemented, and none were pending.

Cleanups of Homeless Camps: Improved communications and data needed

Report published March 31, 2019| Follow-up report | Contact Minh Dan Vuong

Progress on recommendations continues during pandemic. The City's Homelessness and Urban Camping Impact Reduction Program is responsible for coordinating clean up and abatement of areas where people live in tents and makeshift shelters on City property. It takes complaints, assesses campsites, removes trash, and sometimes displaces camp residents. Our 2019 audit found that the City's program needed to improve public information, data analysis, and some internal policies. In the first year after the audit, the program improved how it takes care of the property of people displaced from camps and began to build a web application to better track its work. In the second year, the pandemic stalled some work on the web application, but progress on other recommendations continued.

On this audit there were five recommendations implemented, two in process, and none not implemented or pending.

On this audit there were five recommendations implemented, two in process, and none were not implemented or pending.

Portland Building Contract: Costs reviewed were consistent with contract, although required cost classification and calculations for final payment need to start now

Report published October 3, 2019 | Follow-up report | Contact: Tenzin Gonta

Our 2019 report found the Portland Building renovation costs reviewed by auditors were consistent with the construction contract, although key tasks remained to prepare for final payment. Since then, the City has affirmed which construction costs are subject to audit, added the skills of a construction auditor, and developed a plan for remaining work. We will monitor progress over the next year as the City completes its final cost reconciliations and a report on lessons learned from the Portland Building renovation.

On this audit there were three recommendations implemented, three in process, and none not implemented or pending.

A bar graph showing three recommendations implemented, three in process, and none were pending or not implemented.

City credit card use slowed during pandemic but exposed underlying risks

Report published April 14, 2021 | Contact: Jenny Scott

New risks for City-issued credit card misuse emerged when employees began working from home due to COVID-19. We asked: How did compliance with rules, management, and card spending change? We found some issues the City should shore up to prevent misuse.

This is a new audit with two recommendations pending follow-up.


Not Implemented Recommendation Details

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We recommended that the Chief Administrative Officer present budget-to-actual reports that reflect the complete Portland Building renovation costs that tied to the original $195 million budget for the main project as well as approved side projects that in 2019 were expected to collectively total $214 million, less financing costs. The City did not implement this recommendation. Reports to Council and the Oversight Committee continue to focus only on the main project. Other public reports present this information in piecemeal. As a result, the total renovation costs are not clear or transparent to decision-makers or the public. (Portland Building Reconstruction: City faced with important post-planning decisions to ensure project success)

In Process Recommendation Details

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We recommended the Chief Administrative Officer report on the status of accessibility barriers at the Portland Building. The project team has continued to consult with City staff with expertise with the Americans with Disabilities Act. The project team said that that it has an approach to address reasonable accommodations for the public as well as City employees. The City plans to finish this work once the building is open to the public and occupied by employees. (Portland Building Reconstruction: City faced with important post-planning decisions to ensure project success)

We recommended that the Chief Administrative Officer complete the remaining State and local historic preservation requirements for the Portland Building. The City and the State Historic Preservation Office signed a mitigation agreement in March 2021 that is in effect through June 2025. As part of that agreement, the City committed to mitigation tasks and completed one so far - an exterior interpretative display. The City has yet to complete the remaining three tasks, which include an interior history wall, monograph, and a web- based panel discussion. (Portland Building Reconstruction: City faced with important post-planning decisions to ensure project success)

We recommended that the program give status updates to people making complaints about homeless camps. Once the web application is complete, people filing complaints will be able to check report status online. In addition, the City's 311 call system provides new capacity to answer questions related to campsites. (Cleanups of Homeless Camps: Improved communication and data needed)

We recommended the homeless camp program establish systems to improve data quality and reduce manual processes. The program is working with the Bureau of Technology Services to develop a web application. Implementation stalled because of changes in pandemic-related priorities in Technology Services. The system is now largely implemented, with the last step being to get contractors fully set up and able to report conditions in the field. (Cleanups of Homeless Camps: Improved communication and data needed)

We recommended the City begin phased cost reconciliations for the Portland Building contract immediately rather than wait until construction closeout. The City has completed Part One of its plan. The construction auditor reviewed billed costs through September 2019 when the project was at about 87 percent completion. The report concluded that "it was a fairly clean audit" with "instances of potential overbilling, inadequately supported charges, and other areas for improvement." The City reports that Part Two of the plan has been underway since October 2020. (Portland Building Contract: Costs reviewed were consistent with contract, although required cost classification and calculations for final payment need to start now)

We recommended that the City particularly scrutinize Portland Building contractor rates for personnel costs other than salary or wages, such as health benefits and unemployment taxes. Last year's audit report found these contractor rates were based on estimates and found some examples where these rates were higher than actual costs. Personnel costs is one of the largest and most consistent areas with cost savings during construction audits. The City has begun its reviews. The Part One report found the contractor's rates for these personnel costs were calculated accurately, however, it did question this area for subcontractors and made plans for further work during Part Two. (Portland Building Contract: Costs reviewed were consistent with contract, although required cost classification and calculations for final payment need to start now)

We recommended that the City identify lessons learned from the Portland Building renovation and distribute this information to bureaus that manage large-scale capital construction projects. The City has started drafting a "playbook" for lessons learned. This report will also include improvement areas identified in last year's audit report, such as clearer contract language about cost documentation and completed project management plans. (Portland Building Contract: Costs reviewed were consistent with contract, although required cost classification and calculations for final payment need to start now)

Implemented Recommendation Details

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We recommended grant reporting to Council as required by the original Portland Building Resolution, and informing applicants of City's grantmaking status. Council's direction to disburse these funds in a timely manner during the Portland Building project was not met. Planned grants to support disadvantaged workers and businesses were not disbursed prior to construction completion. However, after our audit report, City Council adopted a January 2020 ordinance that supersedes the 2016 resolution about the Portland Building grants and transfers responsibilities to Prosper Portland for grant administration. Prosper Portland and a nonprofit partner made the first awards to grant recipients in July 2020. The Chief Administrative Officer reported to City Council in August 2019 and June 2020 with updates about grant administration preparations. While the timeliness requirement was not met, our recommendation - based on Council's 2016 resolution - to disburse and report on grants is now implemented. Applicants that applied for grants in August 2018 were notified in July 2019 that the City had cancelled those planned awards. (Portland Building Reconstruction: City faced with important post-planning decisions to ensure project success)

We recommended removing ratepayer funds from the Portland Building project community benefits budget if future grants are not reasonably related to the provision of water and sewer services. The project team reports it removed about $364,000 in ratepayer funds from the community benefits budget. To make up the difference, tenant bureaus that use other City funding will increase their contributions to keep the budget at $1 million. The increase impacts bureaus funded by General and Transportation Funds most significantly. (Portland Building Reconstruction: City faced with important post-planning decisions to ensure project success)

We recommended improving communication to people experiencing homelessness about when crews will most likely clear homeless camps, and improving the durability of the notices. In addition to posting notices, crews go to cleanup locations one day ahead to tell people of the upcoming cleanup. Crews also give people at least one hour to pack their belongings. (Cleanups of Homeless Camps: Improved communication and data needed)

We recommended ensuring that contractors have a common understanding of what the City considers personal property at homeless camps. Crews changed their processes: Crews pack property in clear plastic bags and warehouse staff photograph and inventory property. Crews receive on-going training. The program website describes what property will be stored and what will be discarded. (Cleanups of Homeless Camps: Improved communication and data needed)

We recommended ensuring that homeless camp cleanup contractors improve storage policies and procedures, including extra safeguards for sensitive property. The program uses a larger warehouse and has eased access for people picking up their property. Sensitive property, such as identification cards, are now stored indefinitely in a secure room. (Cleanups of Homeless Camps: Improved communication and data needed)

We recommended clarifying the homeless camp cleanup assessment risk factors and scoring, identifying what risk factors require photographic documentation, and establishing a common understanding of the criteria among the crews who carry out the assessments. The program said it improved the consistency of assessments and put quality controls in place. Photos are required of all materials and debris at campsites. (Cleanups of Homeless Camps: Improved communication and data needed)

We recommended that the homeless camp cleanup program use data to analyze and improve the effectiveness of cleanups. The program is now using system data to adapt to changing conditions caused by the pandemic. Improved data allows the program to be more responsive to requests for information from policy makers. (Audit: Cleanups of Homeless Camps: Improved Communication and Data needed. (Cleanups of Homeless Camps: Improved communication and data needed)

We recommended that the City classify Portland Building contract costs into the categories that determine what documentation the City can review. The classification was a missing piece of information needed by the City to assess contract compliance, evaluate reasonableness of costs, and help calculate final payment to its contractor. The City has since completed the cost classification that aligns with the contract amount as of December 2020. The completed classification confirmed estimates in last year's audit report that the City has the right to audit detailed invoices and actual costs for about half of the contract amount. (Portland Building Contract: Costs reviewed were consistent with contract, although required cost classification and calculations for final payment need to start now)

We recommended the City use a construction auditor to assist with Portland Building cost reconciliations and help identify any questionable costs or potential cost savings. The City is using an owner's representative to help manage the Portland Building renovation. The owner's representative contract includes a provision for audit services, and an audit subconsultant started working for the City's owner team in January 2020. (Portland Building Contract: Costs reviewed were consistent with contract, although required cost classification and calculations for final payment need to start now)

We recommended that the City develop a plan for the work leading up to the calculation of final payment to the Portland Building contractor. That is because cost reconciliations for large construction projects can be time consuming. For example, it is critical for the City to compare estimates billed to actual costs paid by the contractor. The City has since identified a two-part plan, and identified the parties involved, role, responsibilities, and timelines for the remaining work to be completed in mid-2021. (Portland Building Contract: Costs reviewed were consistent with contract, although required cost classification and calculations for final payment need to start now)

Pending Recommendation Details

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The Office of Management and Finance should determine who is responsible for monitoring compliance with payment card rules throughout the purchase cycle and ensure they have the appropriate authority to enforce them. (City credit card use slowed during pandemic but exposed underlying risks)

The Office of Management and Finance should develop a Citywide policy to address the purchase, documentation, safeguarding, and appropriate use of gift cards, including guidance specific to rewarding volunteers. (City credit card use slowed during pandemic but exposed underlying risks)


Data Notes

At the end of every audit report, we issue a series of recommendations intended to make programs work even better. This report includes the status of Bureau recommendations since 2018, which was the beginning of our new follow-up process. We prepared it with a few audiences in mind:

  • City Council can use it to identify bureaus that may need additional resources or support in order to implement recommendations.
  • Bureau directors can use it to assess bureau performance and to determine if any changes in policy or procedure are necessary.
  • Bureau management and staff can use it to track recommendation status across audits to develop work plans and priorities.
  • General public can use it to monitor the status of recommendations related to topics of interest and to compare performance across bureaus.

This report includes recommendation status as of December 31, 2021.


Translated reports
Reports from this year and most of 2021 are available in four languages: Spanish, Vietnamese, Chinese, and Russian. We are translating new reports as they’re released, but older reports may not be available in a language other than English. If you would like to request a translated version of a report, please contact Leslie Chaires.


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