PLEASE STAND BY. PLEASE STAND BY. ≫ WELCOME TO THE MEETING OF THE AUDIT COMMITTEE FOR JUNE 22, 2026. I'M JAY SINGLETON, THE VICE CHAIR OF THIS COMMITTEE. I WANT TO OFFER A FRIENDLY REMINDER TO ALL MEMBERS, STAFF, AND THE PUBLIC THAT THESE MEETINGS ARE BROADCAST LIVE TO ENABLE GREATER PUBLIC PARTICIPATION. THESE BROADCASTS INCLUDE REAL-TIME CAPTIONING AS A FURTHER METHOD TO INCREASE THE ACCESSIBILITY OF OUR PROCEEDINGS TO THE COMMUNITY. THEREFORE, ALL SPEAKERS NEED TO BE MINDFUL OF THE RATE OF THEIR SPEECH SO THAT OUR CAPTIONERS CAN FULLY CAPTURE AND TRANSCRIBE ALL COMMENTS FOR THE BROADCAST. WE ASK ALL SPEAKERS TO MODERATE THE SPEED AND CLARITY OF THEIR
COMMENTS. AT THIS TIME I'LL ASK THE CLERK TO CALL THE ROLL SO WE CAN VERIFY A QUORUM FOR THIS MEETING. ≫ AUDIT MEMBER AL-MOWAFAK. ≫ HERE. ≫ COMMITTEE MEMBER CHUGHTAI. ≫ ENGLEHART. ≫ HERE. ≫ HOSBEIN. ≫ HERE. ≫ PETERSON. ≫ VICE CHAIR SINGLETON. ≫ HERE. ≫ CHAIR PAYNE IS ABSENT. THERE ARE SIX MEMBERS PRESENT. ≫ LET THE RECORD REFLECT THAT WE HAVE A QUORUM.
I'LL ALSO NOTE WE HAVE TWO NEW MEMBERS JOINING US TODAY. LET ME EXTEND A WARM WELCOME TO COMMITTEE MEMBERS AL-MOWAFAK AND PETERSON. THANK YOU FOR BEING HERE, AND WE'RE EXCITED TO HAVE YOU JOIN US. COLLEAGUES, OUR AGENDA IS BEFORE US. MAY I HAVE A MOTION. ≫ SO MOVED. ≫ ALL THOSE IN FAVOR, SAY AYE. ≫ AYE MUCH. ≫ THOSE OPPOSED SAY NAY. THAT CARRIES. THE AGENDA IS ADOPTED. NEXT WE HAVE THE ACCEPTANCE OF MINUTES FROM OUR APRIL 20 REGULAR MEETING AND OUR APRIL 22 ADJOURNED MEETING. MAY I HAVE THAT MOTION. ≫ SO MOVED. ≫ ALL THOSE IN FAVOR SAY AYE.
≫ AYE MUCH. ≫ THOSE OPPOSED SAY NAY. THAT CARRIES. THE MINUTES ARE ACCEPTED. WE HAVE FOUR ITEMS AND NEW BUSINESS TODAY. ITEM THREE IS THE WORKFORCE OPTIMIZATION AND COMPARATIVE BENCHMARKING REPORT. CITY AUDITOR ROBERT TIMMERMAN WILL JOIN US TO GIVE THAT REPORT. WELCOME. ≫ THANK YOU, GOOD MORNING, AUDIT COMMITTEE. GOOD MORNING, CHAIR SINGLETON. THE WORKFORCE OPTIMIZATION REPORT THAT WAS BEFORE YOU ON APRIL 20 OF THIS YEAR HAD A MINOR CHANGE TO IT. THE NEIGHBORHOOD COMMUNITY RELATIONS SECTION HAS BEEN UPDATED. I HATE TO ADMIT IT, BUT THERE WAS
A CONFUSION BETWEEN N.C.R. AND N.S.D. IN SOME OF THE WORK THAT WE HAD DONE IN THAT REPORT WITH OUR CONSULTANTS. AND SO I BELIEVE IT'S PAGE 134 OF THAT REPORT THROUGH 140. THEY'VE BEEN UPDATED. THE UPDATED REPORT IS ON OUR WEBSITE, AND THIS ITEM IS SIMPLY TO ENTER THE AMENDED REPORT IN THE PUBLIC RECORD. THANK YOU. ≫ DO ANY OF MY COLLEAGUES HAVE ANY QUESTIONS? I WILL NOW DIRECT THE STAFF TO PUBLISH THAT REVISED REPORT. MEMBERS, MAY OF A MOTION. ≫ SO MOVED. ≫ THE CLERK WILL CALL THE ROLL.
ALL THOSE IN FAVOR. ≫ AYE. ≫ ANY OPPOSED? THAT CARRIES. ALL RIGHT, NEW BUSINESS ITEM NUMBER FOUR IS THE 2026 MEET MINNEAPOLIS CONTRACT MANAGEMENT AUDIT REPORT. WE'LL BE JOINED BY THE DIRECTOR OF INTERNAL AUDIT FOR THIS PRESENTATION. WELCOME. ≫ GOOD MORNING, MIX OF THE AUDIT COMMITTEE. I'M THE DIRECTOR OF AUDIT. I'M HERE TO PRESENT THE RESULTS OF THE RECENTLY COMPLETED AUDIT OF THE CITY'S CONTRACT WITH MEET MINNEAPOLIS AND ALSO THE MANAGEMENT PRACTICES WITH THE MINNEAPOLIS CONVENTION CENTER. THIS IS THE OVERVIEW OF THE PRESENTATION I'M GOING TO
PRESENT ABOUT THE BACKGROUND, OBJECTIVES AND CONCLUSION, FINDINGS AND RECOMMENDATIONS, AS WELL AS THE MANAGEMENT ACTION PLANS. SO WHY AUDIT ON THIS TOPIC? WE PERFORMED THIS ENGAGEMENT TO ENSURE CONTRACTUAL OBLIGATIONS ARE CLEARLY DEFINED, PROPERLY MONITORED, AND CONSISTENTLY ENFORCED. THIS WAY WE CAN PROACTIVELY RESPOND TO IDENTIFIED CONTRACT MANAGEMENT RISKS, CONFIRM, COMPLIANCE WITH CONTRACT TERMS, AND MITIGATE PERFORMANCE REPORTING GAPS, STRENGTHEN DOCUMENTATION INTERNAL CONTROLS, AND CITY OVERSIGHT.
TOGETHER THESE ACTIONS SERVE TO MAINTAIN ACCOUNTABILITY, DATA INTEGRITY, AND PUBLIC TRUST IN HOW CITY CONTRACTS ARE ADMINISTERED. PROVIDING YOU WITH A LITTLE BACKGROUND, THE CITY OF MINNEAPOLIS SUPPORTED THE CREATION OF THE MEET MINNEAPOLIS AND EXECUTED THE CONTRACT TO PROMOTE THE CITY AS A MAJOR CONVENTION AND RESEARCH DESTINATION. MOST OF THE SERVICES ARE FOCUSED ON MARKETING AND SALES AT THE CONVENTION CENTER, BUT THEY ALSO PROVIDE SUPPORT ASSISTANCE FOR COMMUNITY EVENTS AND THE 12 MINNEAPOLIS SISTER
CITY RELATIONSHIP IN THE SISTER CITY PROGRAM. THE MINNEAPOLIS CONVENTION CENTER MANAGES THE CONTRACT BETWEEN THE CITY AND MEET MINNEAPOLIS SO BASICALLY THEY ARE THE CONTRACT HOLDER ON BEHALF OF THE CITY. SO FROM PAYMENTS STANDPOINT FROM JANUARY 2021 TO DECEMBER 2025, THE CITY PAID ABOUT $56. 3 MILLION TO MEET MINNEAPOLIS FOR THIS PURPOSE. THIS CHART IS BASED ON THE DATA PROVIDED BY M.C.C. AND THE CITY'S A.P. SYSTEM. NORMALLY THE PAYMENT IS BASED ON THE QUARTER PAYMENTS AS WELL AS IF THEY MEET CERTAIN K.P. I.'S. THERE IS AN INSIDE PORTION AS WELL.
THE CITY MEASURES PERFORMANCE THROUGH THE FOLLOWING FOUR K.P.I.'S. THE FIRST ONE IS THE MINNEAPOLIS CONVENTION CENTER. THE REVENUE PORTION, WHICH IS SPECIFICALLY AS THE CONVENTION CENTER FROM EVENTS, SO THE SECOND ONE IS GROSS, LODGING TAX EARNED. THE THIRD ONE IS ANNUAL PARTNERSHIP AND GROWTH. AND THE FOURTH ONE IS FUTURE ROOM NIGHTS. THE AUDIT OBJECTIVES OF THIS AUDIT WERE TO ASSESS COMPLIANCE WITH THE CITY'S CONTRACT MONITORING PROCEDURES, THE OBJECTIVITY OF THE CONTRACT'S KEY PERFORMANCE INDICATORS, AND WHETHER STRATEGIC BUSINESS PLAN INITIATIVES WERE MET IN 2025.
NEXT TALKING ABOUT THE SCOPE AND METHODOLOGY. THIS AUDIT FOCUSED ON PROCESS AND CONTROLS AROUND CONTRACT MONITORING AND PERFORMANCE, INCLUDING BUT NOT LIMITED TO CONTRACT AGREEMENT TERMS, MEET MINNEAPOLIS STRATEGIC BUSINESS PLAN, 2025K.P.I. GOALS, CITY CONTRACT MANAGEMENT PROCEDURES. AND OUR SCOPE COVERED RETROACTIVELY FROM JANUARY 1, 2025, THROUGH DECEMBER 31, 2025. SO BASICALLY WE LOOKED AT THE MOST RECENT SIGNED CONTRACT WHICH STARTED JANUARY 1, 2025, AND ALSO RUNS UP TO
DECEMBER 2029. SO BASICALLY FOR THAT CONTRACT PERIOD, ONE YEAR HAD PASSED, SO BASICALLY WE CHOSE TO REVIEW THAT PORTION OF IT. WE USE AUDIT METHODS SUCH AS INTERVIEWS WITH MINNEAPOLIS CONVENTION CENTER AND THE MEET MINNEAPOLIS STAFF TO UNDERSTAND THE PROCESS. WE ALSO CONDUCTED WALK-THROUGHS OF SYSTEMS THEY USE TO CAPTURE INFORMATION TO MAKE SURE THEIR RELIABILITY AND APPROVALS AND ALSO REVIEWED THE CONTROLS AS WELL. SPECIFICALLY, WE LOOKED AT THE CONTROLS RELATED TO THE K.P.I. 'S TO INDUSTRY BENCH MARK AND ALSO
THE STRATEGIC BUSINESS PLAN. AND THE KEY AREAS THAT WE FOCUSED FOR THIS AUDIT IS COMPLIANCE WITH THE CONTRACT TERMS, OPERATIONAL AND FINANCIAL. SO BASED ON OUR REVIEW, WE CAME TO THE CONCLUSION THAT M.C.C. MINNEAPOLIS CONVENTION CENTER, COULD STRENGTHEN PROCESSES AND OVERSIGHT BY DOCUMENTING PROCEDURES FOR DEPARTMENTAL CONTRACT MANAGEMENT AND MEET MINNEAPOLIS' STRATEGIC BUSINESS PLANNING AND BY REVIEWING MEET MINNEAPOLIS PARTNER PERFORMANCE MEASURES, WHICH IS ONE OF THE K.P.I.'S. AND THERE ARE THREE FINDINGS, WHICH WE'LL COVER IN THE NEXT FEW SLIDES. TWO OF THEM ARE MODERATE FINDING.
SO THE FIRST FINDING IS RELATED TO THE STRATEGIC BUSINESS PLAN PROCESS. THE BUSINESS PLAN PROCESS COULD BE BETTER DOCUMENTED THROUGH ROAD MAP THAT OUTLINES PROCESS DELIVERABLES, AND TIMELINES NEEDED TO CREATE A GOOD PLAN AND FULFILL CONTRACTUAL OBLIGATIONS. SO WHEN WE REVIEWED IT, THE BUSINESS PLAN DOES NOT INCLUDE A KEY THAT IS PART OF THE AGREEMENT, AS WELL AS DOCUMENTING THE PROCESS OF PRODUCING THE PLAN SO WE NOTED THAT ALL THE STAFF DIDN'T KNOW HOW TO GO ABOUT CREATING THIS BUSINESS PLAN, BUT IT WAS NOT DOCUMENTED PROPERLY SO THAT IF WE NEED TO RETAIN EXISTING STAFF OR TRAIN NEW
STAFF IN FUTURE, SO THAT WAY WE DON'T HAVE TO RELY ON THE EXISTING STAFF, SO WE HAVE THAT DOCUMENTED PROCESS WHEN WRITTEN SO THAT WE CAN USE THAT FOR THAT PURPOSE. SO BASICALLY WHAT WE'RE SAYING IS THEY KNOW WHAT THEY'RE DOING, BUT AT LEAST THEY NEED TO DOCUMENT THOSE THINGS. AS A PART OF THE RECOMMENDATION, WE MENTIONED THAT MINNEAPOLIS CONVENTION CENTER MANAGEMENT SHOULD ENSURE THAT THE BUSINESS PLAN THAT IS PROVIDED FOR REVIEW CONTAINS THE CREATION DATE AND THE DATE IT WAS RECEIVED BY THE EXECUTIVE DIRECTOR. BECAUSE WHEN YOU LOOK AT THE CONTRACT, IT SHOULD BE RECEIVED BY SEPTEMBER. WHEN THE PLAN IS EXECUTED, THERE ARE CERTAIN DATES IN THE CONTRACT, AND WHEN WE REVIEWED THE ACTUAL BUSINESS
PLAN, WE COULD IDENTIFY, BECAUSE IT'S LIKE A COLLABORATIVE PROCESS BETWEEN M.C.C. CONVENTION CENTER AND MEET MINNEAPOLIS, SO THEY ARE WORKING TOGETHER ON THOSE, SO THEY ARE, THEY KNOW WHAT'S GOING ON. BUT WHEN WE JUST COMPARE THAT WITH THE CONTRACT ITSELF, WE COULDN'T FIND THAT SPECIFIC DATE. COLLABORATE WITH MEET MINNEAPOLIS TO DOCUMENT STEP BY STEP PROCESS FOR DEVELOPING THE BUSINESS PLAN. COLLABORATE WITH MEET MINNEAPOLIS TO ENSURE THAT COST ESTIMATES ARE CLEARLY ARTICULATED IN THE PLAN AS WELL. COLLABORATE WITH MEET MINNEAPOLIS TO ENSURE IF WEBSITE CONTAINS MAINTENANCE INFORMATION THAT CAN BE USED TO DETERMINE IF THE INFORMATION ON THE SITE IS UP TO DATE, AND WHEN THE SITE WAS LAST UPDATED. ALSO WE RECOMMENDED M.C.C.
TO WORK WITH MEET MINNEAPOLIS TO FORMALLY DOCUMENT THE K.P.I. 'S DEVELOPMENT PROCESS. AND THE LAST ONE IS TO ENSURE THAT MEET MINNEAPOLIS PROVIDES CLEARLY DEFINED INDUSTRY AND TREND INDICATORS AND AGREED UPON MEASUREMENT DATA IN THE BUSINESS PLAN AS PROVIDED IN THE SECTION 2. 2 OF THE CONTRACT. SO THE NEXT ONE IS RELATED TO THE CONTRACT MANAGEMENT PROCEDURES WITHIN MINNEAPOLIS CONVENTION CENTER. WE FOUND THAT THE MINNEAPOLIS CONVENTION CENTER COULD BETTER DOCUMENT ITS INTERNAL CONTRACT MANAGEMENT-RELATED PROCEDURES, WHICH WOULD ENSURE THE TRANSFER
OF KNOWLEDGE IS PROTECTED AND DISTRIBUTED TO OTHERS. SIMILARLY, TO THE FINDING, SO THIS ONE IS THEY KNOW WHAT THEY'RE DOING AND THEY HAVE DECADES OF EXPERIENCE AS WELL. BUT AGAIN, IF YOU NEED TO TRAIN OR RETRAIN NEW OR EXISTING STAFF, WE NEED TO HAVE LIKE A PROPER, FORMALLY DOCUMENTED PROCEDURES AS WELL. ALSO TYING CITY FINANCE DOES HAVE THEIR POLICY REGARDING WHAT NEEDS TO BE DONE BROUGHT FROM PROCEDURES STANDPOINT, THESE PROCEDURES HAVE TO BE SPECIFIC, REGARDING SPECIFIC DEPARTMENTS. SO WE SAW THERE WERE SOME, BUT IT COULD ALSO BE ENHANCED IN THAT REGARD.
SO FROM RECOMMENDATION STANDPOINT, WE RECOMMEND MINNEAPOLIS CONVENTION CENTER MANAGEMENT SHOULD FORMALLY DOCUMENT INTERNAL CONTRACT-RELATED PROCEDURES SO THAT STAFF CAN FOLLOW STANDARDIZED PROCESSES FOR CONTRACT OVERSIGHT, CREATE A REPOSITORY OF MEET MINNEAPOLIS CONTRACT DOCUMENTS ACCESSIBLE BY APPROPRIATE STAFF TO PROVIDE RECORDS OF HISTORICAL DATA FOR COMPLIANCE AND FUTURE PLANNING PURPOSES. AND THE THIRD ONE IS RELATED TO THE OBJECTIVITY OF THE K.P.I. METRICS. THE ANNUAL PARTNERSHIP GROWTH AND RETENTION K.P.I. GOAL AGREED UPON MEASUREMENT COULD BETTER HIGHLIGHT PARTNERSHIP GROWTH AND RETENTION ACTIVITY. SO
BASICALLY WHEN WE LOOK AT ONE OF THOSE K.P.I. 'S, IT MENTIONS ABOUT A GAIN OF EIGHT PARTNERS FROM 2024 TO 2025, SO OUR INITIAL QUESTION WAS WHY IS THE CITY SPENDING SO MUCH MONEY TO GAIN EIGHT MORE PARTNERS? BUT WHEN WE REVIEWED IN DETAIL, WE IDENTIFIED, MEET MINNEAPOLIS NEW PARTNERS IN 2025, BUT AT THE SAME TIME, THEY LOST 17, SO THE DIFFERENCE IS LIKE EIGHT. SO THEY ARE GAINING THOSE PARTNERS AND LOSING SOME OF THE PARTNERS WOULD SOMETIMES OR NOT BE IN THEIR CONTROL, BECAUSE SOMETIMES THEY'RE SMALL VENDORS, SO SOMETIMES THEY GO OUT OF BUSINESS AS WELL, SO WE UNDERSTAND THAT'S PART OF THE
BUSINESS AS WELL. BUT WHAT WE'RE SAYING IS PROBABLY THEY NEED TO BE SHOWN AS ONE OF THE K.P.I. 'S A LITTLE BIT BETTER WAY AS WELL. AND WE ALSO FORMED THE PARTNER LISTING THAT DOESN'T ALIGN WITH THE NUMBER OF ACTIVE PARTNERS WITH PAID DUES, WHILE WE DID NOT FIND ANY DUPLICATE RECORDS, THE NUMBER OF PAYMENTS DID NOT MATCH. WHEN WE TALKED TO MEET MINNEAPOLIS MANAGEMENT AND STAFF, THEY MENTIONED THAT SOMETIMES SOME BUSINESSES ARE BILLED UNDER OTHER BUSINESSES AS WELL, SO IT'S NOT ALWAYS ONE TO ONE WHEN WE LOOK AT NUMBER PARTNERS VERSUS THE NUMBER OF DUES PAID AS WELL. SO BASICALLY THE PLAN DOES NOT DIRECTLY DESCRIBE AN EXISTING
PARTNER RETENTION GOAL, BECAUSE ULTIMATELY THE LONG-TERM PARTNERS MAY BE MORE ENGAGED WITH THE ORGANIZATION AND PROVIDE FINANCIAL STABILITY AND INCREASES RETENTION, MAYBE MORE COST EFFECTIVE THAN THE CONSENT GROUPING. SO IT'S GOOD THAT WE'RE GROWING THE PARTNERS, BUT IT'S ALSO IMPORTANT TO RETAIN SOME OF THE EXISTING PARTNERS AS WELL, WHICH IS ALWAYS FROM COST STANDPOINT, MORE EFFICIENT. SO IN TERMS OF RECOMMENDATION, WE ARE RECOMMENDING THE M.C.C. MANAGEMENT COLLABORATE WITH MEET MINNEAPOLIS TO REVISE THE AGREED UPON MEASUREMENT DATA TO ACCURATELY REPORT
PARTNERSHIP GROWTH AND RETENTION ACTIVITY, ENSURE THAT THE BUSINESS PLAN ADDRESSES RETENTION, AND WORK WITH MEET MINNEAPOLIS TO REVISE THE PARTNER REPORT VERIFYING EITHER PAYMENTS ARE MADE OR BALANCES DUE. AND IN TERMS OF MANAGEMENT ACTION PLAN, M.C.C. MANAGEMENT AGREED TO ALL THE RECOMMENDATION AND DEVELOP THEIR OWN CORRECTIVE ACTION PLANS ACCORDINGLY AS WELL, WHICH ARE PRIMARILY RELATED TO THE INTERNAL, SO THOSE EXISTING UPDATING AND DRAFTING, THOSE EXISTING PROCEDURES, BOTH INTERNALLY AND WITH THE MEET MINNEAPOLIS LEADERSHIP ASSESS
IF THE PARTNERSHIP GOALS NEED TO BE UPDATED, AND THEN FOR ALL THE THREE FINDINGS THAT WE HAVE THEY CAME UP WITH A PLAN COMPLETION DATE OF DECEMBER 31, 2026. THEIR CORRECTIVE ACTION WILL SUFFICIENTLY REMEDIATE THE ISSUES IDENTIFIED IN THE AUDIT, AND THEIR MANAGEMENT ACTION PLAN, INCLUDING THE REPORT, ARE UNDER THE MANAGEMENT RESPONSE LETTER IN DETAILS AS WELL. SO THAT'S THE PRESENTATION FOR THE MEET MINNEAPOLIS CONTRACT MANAGEMENT AUDIT. NOW, I STAND FOR ANY QUESTIONS. ≫ THANK YOU FOR THAT PRESENTATION. DO ANY OF MY COLLEAGUES HAVE QUESTIONS ABOUT THIS REPORT? COMMITTEE MEMBER HOSBEIN? ≫ THANK YOU, CHAIR SINGLETON.
DIRECTOR, I HAVE TWO, I DON'T KNOW THE CITY QUESTIONS, IF YOU COULD HELP ME CLARIFY. AND THIS IS RELATED A LITTLE BIT TO I FEEL LIKE IN 2023, 2025, AND THEN TODAY WE'RE ALL KIND OF AROUND THESE SAME CONTRACT ISSUES WITHIN THESE SAME GROUPS. MAYBE I'M JUST NOT CONNECTING ALL THE ACRONYMS, AND MAYBE THIS IS TO THE EARLIEST POINT. SO N.C.R. , NEIGHBORHOOD COMMUNITY RELATIONS, DOES THAT CONNECT AT ALL TO THE NEIGHBORHOOD SAFETY DEPARTMENT? ≫ NO. THOSE ARE SEPARATE. ≫ THANK YOU. BECAUSE THAT WAS THE AUDIT FROM FEBRUARY 2025 THAT I FEEL LIKE HAD VERY SIMILAR -- ≫ AND THE NEIGHBORHOOD DEPARTMENT, THEY FALL UNDER THE OFFICE OF COMMUNITY SAFETY, AND
N.C.R. FALLS UNDER THE OFFICE OF PUBLIC SERVICE. ≫ AND THEN THIS ONE IS THE ONE THAT CAME OUT OF THE 2023 SAFETY RISK ASSESSMENT, RIGHT? THIS THING GOT PUT ON HOLD. ≫ SO THIS ONE, SO WE ALWAYS HAD PLANS REGARDING THE PHASE TWO OF THE CONTRACT MANAGEMENT. SO BASICALLY THE FIRST PAGE WAS MORE IN GENERAL, SO BASICALLY FOR THIS ONE, WE WERE THINKING ABOUT WHAT SHOULD WE FOCUS ON AS A PART OF PHASE TWO. AND WE THOUGHT THIS AUDIT WAS DONE SOMETIME MAYBE SEVEN, EIGHT YEARS AGO. AND WE JUST WANTED TO DO A FOLLOWUP AUDIT, BECAUSE AT THAT
TIME WE IT HAVE FEW FINDINGS. SO OUR GOAL WAS TO FOLLOW UP ON THOSE FINDINGS, AS WELL AS TO MAKE SURE WHETHER THEY HAD BEEN CORRECTED OR NOT AND TO MAKE SURE SOME OF THESE K.P.I. 'S AT THAT TIME, WE FOUND SOME FINDINGS RELATED TO K.P.I. 'S AS WELL, SO WE THOUGHT IT WOULD BE A GOOD IDEA TO DO A FOLLOW-UP AUDIT AS PART OF PHASE TWO. ≫ PERFECT, THANK YOU. I THINK MAYBE I'LL FOLLOW UP SEPARATELY, BECAUSE I THINK THERE'S A LOT OF WORK AROUND THIS 2023 COMMUNITY SAFETY RISK ASSESSMENT, AND THERE WERE SEVERAL UPDATES THAT I DON'T THINK IS RELATED TO THIS, BUT
I'M TRYING TO FIGURE OUT HOW THAT FITS INTO ALL THESE. ≫ YES, BASICALLY AT THAT TIME, WE USED TO HAVE TWO SEPARATE REPORTS, ONE FOR COMPANY SAFETY SIDE AND ALSO ALL THE REST OF THE DEPARTMENTS IN THE CITY AS WELL. BUT SINCE THEN, IT DOESN'T MAKE SENSE FOR OUR OFFICE TO COME UP WITH TWO DIFFERENT AUDIT PLAN AND REPORT AS WELL. SO THEN WE DECIDED TO COMBINE THOSE TOGETHER AS ONE PLAN IN THE REPORT. ≫ THANK YOU FOR THAT, BECAUSE I THINK THE ROOT OF MY QUESTION IS SHOULD SOME OF THIS ALREADY HAVE BEEN TAKEN CARE OF.
BECAUSE I FEEL LIKE IT'S NOT THE FIRST TIME WE'VE SEEN THIS. BUT I GET THAT THERE IS, AND WE'VE TALKED ABOUT THIS BEFORE, THE HISTORICAL DOCUMENTATION, AND WHEN THERE'S CHANGE, THAT'S NOT ALWAYS MOVED FROM ONE TO ANOTHER. SO I WOULD JUST SAY I THINK PROBABLY COMMENTS THAT COME ACROSS THE COMMITTEE EVERY TIME IS JUST, THIS IS A PERSISTENT ISSUE, AND I THINK JUST CONTINUING TO ELEVATE THIS, AND IT'S NOT THE FIRST TIME WE'VE SEEN THE CONVENTION CENTER AS PART OF THAT EITHER IN TERMS OF CONTRACT MANAGEMENT. I DON'T HAVE A WHOLE LOT -- I FEEL LIKE WE'VE
SAID ALL THE THINGS BEFORE ABOUT CHECKS AND BALANCES, THE INFLUENCE PIECE, ESPECIALLY WHEN IT COMES TO THE NEIGHBORHOOD SAFETY PIECE. THAT'S SUCH A PERCEPTION AND TRUST ISSUE, TOO, ESPECIALLY WHEN IT'S THIS KIND OF MONEY, IN A CITY WHERE WE'RE BEING TOLD WE'RE HAVING HUGE CUTS AND WE CAN'T GET AUDIT STAFF AND OTHER THINGS WHEN THERE'S THIS BIG OF MONEY. THANK YOU FOR THIS WORK, AND THANKS FOR CONNECTING THE DOTS FOR ME. ≫ AND ALSO TO THE CHAIR, THAT'S WHY IN THE PAST WE HAVE MENTIONED THE IMPORTANCE OF THE ENTERPRISE RISK MANAGEMENT AS WELL. BECAUSE SOME OF THESE ISSUES SHOULD BE FIXED AT THAT LEVEL, SO THAT IF THEY SEE SOME TYPE
OF ISSUE, WHETHER IT'S CONTRACT-RELATED, MANAGEMENT RELATED IN ONE DEPARTMENT, THEN THEY SHOULD BE ABLE TO GO TO OTHER DEPARTMENTS TO SEE IF THEY'RE SIMILAR ISSUES IN THOSE DEPARTMENTS AND TRY TO FIX IT ON THEIR OWN, VERSUS AUDIT, THE INDIVIDUAL AUDIT. ≫ THANK YOU. ≫ COMMITTEE MEMBER AL-MOWAFAK. ≫ THANK YOU FOR THAT PRESENTATION. I JUST HAVE A FEW QUESTIONS. IT'S MENTIONED HERE THAT PHASE TWO OF THE CONTRACT IS 82, SIX MILLION. HOW MUCH OF THE INCREASE OF THE PHASE ONE OF THIS CONTRACT? ≫ SO WHEN I TALK ABOUT THE PHASE ONE AND PHASE TWO, IT WAS THE AUDIT THAT WE HAD SCHEDULED IN THE AUDIT PLAN.
BUT FOR THIS CONTRACT SPECIFICALLY, SO IT HAS BEEN GOING SINCE I THINK 1986, SO THERE'S NO PHASE ONE OR PHASE TWO FOR THIS CONTRACT WITH MEET MINNEAPOLIS. THE PHASE ONE AND PHASE TWO, WE TALKED ABOUT WAS WHAT WAS AS A PART OF THE AUDIT PLAN WE HAD, SO IN THE PAST WE HAD THE PHASE ONE OF THE CONTRACT MANAGEMENT AUDIT, SO WE COMPLETED THAT BACK IN 2023, AND WE ALSO HAD PHASE TWO, WHICH WE COMPLETED RIGHT NOW. BUT THE $6 MILLION QUESTION, SO THIS CONTRACT SPECIFICALLY WITH THE MEET MINNEAPOLIS, WE HAD THIS FOR A LONG TIME.
THIS IS NOT PHASE TWO OF THE CONTRACT ITSELF. ≫ OK, WITH I HAD TO LOOK AT THE CONTRACT TO SEE IT, THAT FOR THIS PERIOD IS FOR 2025 UNTIL 2029. ≫ YES. ≫ AND WHAT IS THE PREVIOUS PERIOD OF THAT ONE. FOR EXAMPLE, IS THAT FROM 2021 TO 2024 BECAUSE WHEN YOU MENTIONED THE PAYMENTS THROUGH THAT CONTRACT FROM 2021 AND TO 2025. ≫ YEAH. ≫ IF WE WOULD LIKE TO COMPARE THE COST OF THAT. ≫ SO BASICALLY, THAT DOLLAR AMOUNT EXACTLY
, THE PAYMENT WAS INCLUDING THE INCENTIVE, IT WAS $56. 3 MILLION. AND BASED ON -- SO FROM THAT POINT, THERE WAS AN INCREASE OF 13. 4% INCREASE IN THE UNRESTRICTED FUND. 22% INCREASE IN ALL FUNDING. WHICH TOTALS UP TO BE $82. 6 MILLION FOR THIS CONTRACT PERIOD, FROM 2025 TO 2029. IT'S GOING TO BE 82. SO BEFORE THAT, IT WAS AROUND $50 MILLION FOR THAT LAST FIVE PERIOD BEFORE 2025. ≫ IS THERE CHANGE IN THE SCOPE
IN THE SERVICES THAT MEET MINNEAPOLIS WOULD PROVIDE FOR M.C.C. , FOR THAT EXTRA AMOUNT OF THIS CONTRACT? ≫ SO THAT ONE IS ALSO BASED ON THE INCREASE IN THE COST OF LIVING AS WELL, BECAUSE -- SO FROM EXPENDITURE STANDPOINT, FOR MEET MINNEAPOLIS, IT AUTOMATICALLY INCREASES, SO A PORTION OF THAT IS COVERED FOR PRIMARILY THAT, AND THERE'S SOME INCREASE IN THE GOALS AMOUNT AS WELL, BECAUSE IN THE PAST IT
USED TO BE TOTAL OFEN? ACTIVE AMOUNT PER YEAR, VERSUS NOW IT'S 800,000. SO THERE ARE SOME INCREASE IN THE COST IN THAT REGARD, CONSIDERING THE COST OF LIVING AND WHATNOT. BUT FROM THE GOAL STANDPOINT OR ADDING MORE SCOPE OF SERVICES, I DON'T THINK IT HAS BEEN DRASTICALLY DIFFERENT. IT'S SIMILAR, BUT IT'S PRIMARILY BASED ON THE COST OF LIVING AND OTHER INCREASES IN THE UNUSUAL GOALS, HOW MUCH MONEY WE HAVE ALLOCATED. ≫ I HAVE OTHER QUESTIONS REGARDING THE K.P.I. HAVE THEY DONE THEM BASED ON THE BASELINE OF PREVIOUS YEARS
OR, FOR EXAMPLE, JUST -- I'M NOT SURE HOW THEY HAVE THAT. BECAUSE WHAT I CAN SAY, WHAT CAN I SEE THERE IN THE FIGURES IN YOUR REPORT THAT K.P.I. 'S FOR, LET'S SAY, RETENTION AND ALSO FUTURE ROOM FOR FISCAL YEAR 2026 ARE LISTS THAN 2024 AND 2025. WHAT IS THE BASELINE WHEN THEY ARE DISCUSSING K.P.I.'S? ≫ BASICALLY IT'S LOOKING AT THE PAST ONE, AS WELL AS ALSO LOOKING AT THE INDUSTRY TRAIN AS WELL. IT'S JUST NOT THE PUREST ONES. I UNDERSTAND IT HAS DECREASED A LITTLE BIT, BUT ALSO BASED ON THE NATIONWIDE INDUSTRY STANDARD OF HOW THOSE SHOULD BE
BASED ON THE SIZE OF THE CITY, AND I DON'T KNOW, MAYBE JEFF OR SANDY, I KNOW YOU HAVE MORE KNOWLEDGE ABOUT THIS ONE. SO IF YOU CAN MAYBE COME UP HERE AND ANSWER THOSE QUESTIONS. THANK YOU. ≫ THANK YOU, VICE CHAIR, MEMBERS OF THE COMMITTEE. I'M THE SENIOR VICE PRESIDENT OF FINANCE AND BUSINESS OPERATIONS FOR MEET MINNEAPOLIS. I'M HAPPY TO ANSWER QUESTIONS ABOUT THE K.P.I.'S. WHICH OF THE FOUR WOULD YOU PARTICULARLY LIKE TO FOCUS UPON? ≫ THE GROWTH AND RETENTION AND THE FUTURE ROOM NIGHTS. ≫ THANK YOU FOR THAT. THE ANNUAL GROWTH AND RETENTION IN THE PARTNERSHIP IS ACTUALLY BASED UPON THE PERFORMANCE FROM THE PRIOR YEAR. SO HOW THAT K.P.I. IS DERIVED IS
THE NUMBER OF PARTNERS THAT ARE CURRENT WITH MEET MINNEAPOLIS ON DECEMBER 31 OF THE CALENDAR YEAR IS CONSIDERED A BASELINE GOING INTO THE UPCOMING YEAR, AND IF RETAIN 100% OR MAINTAIN THAT NUMBER, WE WOULD RESULT IN THE TIER TWO, OR MAINTAIN THAT SAME LEVEL. WE ALSO KNOW WITH THE BUSINESS CHANGES THAT WE'RE ARTICULATED WITH BUSINESSES COMING AND GOING, THAT RETAINING 95% THAT HAVE NUMBER IS ALSO SOMEWHAT CHALLENGING GIVEN THE BUSINESS CYCLE. SO TIER ONE OF THAT K.P.I. IS A 95% RETENTION RATE OF THAT YEAR-END NUMBER. AND THEN
ADDITIONALLY 105% THAT HAVE YEAR-END NUMBER IS CONSIDERED THE TIER THREE. SO THE BASELINE FOR ALL INTENTS AND PURPOSES IS 100% AT TIER TWO. THEN FOR THE FUTURE ROOM NIGHTS, AS WAS ARTICULATED, IT'S BASED UPON INDUSTRY TRENDS AS WELL AS SOME INFORMATION THAT WE DERIVE FROM THIRD-PARTY RESOURCES. AND WE LOOK AT WHAT ACTIVITIES OR CONFERENCES ARE CURRENTLY ON THE BOOKS. SO FUTURE ROOM NIGHTS ARE ROOM NIGHTS BOOKED THIS YEAR FOR ANY PERIOD INTO THE FUTURE. SO IF WE KNOW, FOR EXAMPLE, THAT THE ROTARY IS COMING IN 2028, WHICH WE DO
KNOW, THE YEAR IN WHICH WE BOOKED THAT, IT'S 30,000 ROOM NIGHTS. SO IN THAT YEAR THAT WE BOOKED ROTARY, WE ARE ABLE TO, I WOULD SAY CLAIM 30,000 ROOM NIGHTS BEING BOOKED. THAT'S FEW AND FAR BETWEEN THAT WE'RE ABLE TO GENERATE THAT LEVEL OF BUSINESS IN ANY ONE YEAR. SO YOU SEE THERE'S FLUCTUATIONS OVER TIME. SO WE TAKE HISTORICAL PERFORMANCE, WHAT WE KNOW ABOUT THE FUTURE, AND ALSO THE THIRD-PARTY RESEARCH THAT IS PROVIDED TO US. ≫ IN THE TIER TWO AND TIER THREE, IT IS NOT DOLLAR AMOUNT IN THIS FIGURE. I'M NOT SURE THAT IS A TYPO OR SOMETHING, BECAUSE HERE, FOR
EXAMPLE, I CAN SEE 509, 524 IN TIER TWO -- ≫ I WOULD POSIT THOSE NUMBERS ARE AN ERROR, BECAUSE THE LODGING TAX EARNINGS ARE ALWAYS GOING TO BE IN THE TENS OF MILLIONS OF DOLLARS. ≫ I DID HAVE ONE QUESTION, CHAIR. REGARDING, FOR EXAMPLE, THE RETENTION RATE QUOTE FOR THE PARTNERSHIP, DO WE HAVE ALSO THAT, THE REASON FOR NOT BEING ABLE TO, FOR EXAMPLE, MAKING THIS RETENTION FOR EACH OF THIS BACKGROUND, FOR EXAMPLE, ONE OF THEM JUST OUT OF THE BUSINESS, OTHER ONE JUST WITH SOME OF THE BUSINESS, SO WE KNOW WHAT IS THE REASON FOR NOT BEING ABLE TO JUST KEEP THIS RETENTION. ≫ YES, VICE CHAIR, WE DO DOCUMENT EVERY SINGLE
CANCELLATION THAT COMES THROUGH. THERE'S PROBABLY ABOUT FIVE GENERAL REASONS THAT BUSINESSES MAY CHOOSE NOT TO RENEW WITH US. EMPLOYING OUT OF BUSINESS, OBVIOUSLY, IS ONE OF THEM. THE OTHER IS THAT THEY ARE FEELING STRAINED ON THEIR FINANCIAL REPUBLICAN SOURCES AND NEED TO DEPLOY THEIR DOLLARS ELSEWHERE. THEY MAY HAVE CHANGED THEIR SCOPE OF BUSINESS. SOMETIMES THEY DON'T FEEL THAT THEY'RE GETTING THE VALUE FOR WHAT THEY'RE PAYING AND, OF COURSE, WE DO FOLLOW UP WITH ANY OF THOSE REASONS TO DELVE MORE INTO WHAT WE COULD DO BETTER AND WHAT WE CAN APPLY TO THE FUTURE TO ENSURE THAT WE
RETAIN THOSE MEMBERS. ≫ THANK YOU. ≫ ANY OTHER QUESTIONS? THANK YOU. ≫ THANK YOU. SEEING NO FURTHER QUESTIONS OR COMMENTS FROM COMMITTEE MEMBERS, I'LL DIRECT THE CLERK TO RECEIVE AND FILE THIS REPORT. I'LL NOW DIRECT STAFF TO PUBLISH THIS REPORT. MEMBERS, MAY I HAVE A MOTION. ≫ SO MOVED. ≫ AND THE CLERK WILL NOW CALL THE ROLL. ≫ MEMBER AL-MOWAFAK. ≫ YES. ≫ COMMITTEE MEMBER CHUGHTAI. ≫ ABSENT. ≫ ENGLE HART. ≫ AYE. ≫ HOSBEIN. ≫ AYE.
≫ PETERSON. ≫ AYE. ≫ VICE CHAIR SINGLETON. ≫ AYE. ≫ CHAIR PAYNE IS ABSENT. THERE ARE FIVE AYES. ≫ THAT MOTION CARRIES. MEMBERS WILL NOW MOVE ON TO NEW BUSINESS ITEM NUMBER FIVE, WHICH IS THE NEIGHBORHOOD SAFETY CONTRACT MANAGEMENT AUDIT. WE'LL BE JOINED BY THE DIRECTOR OF SPECIAL REVIEWS AND ADVISORY SERVICE. ≫ VICE CHAIR, COMMITTEE, THANK YOU FOR HAVING ME. I STAND TO PRESENT THE OFFICE OF CITY AUDITORS REPORT ON THE NEIGHBORHOOD SAFETY DEPARTMENT CONTRACT MANAGEMENT AUDIT. DUE
TO HAVE A LENGTHY PRESENTATION, I ASK YOU TO HOLD YOUR QUESTIONS UNTIL THE END. TODAY'S PRESENTATION WILL GO THROUGH A BRIEF BACKGROUND OF N.S.D. AND ITS PLACE IN CITY SERVICES. WE WILL COVER THE OBJECTIVE, SCOPE AND METTOLOGY PERFORMED, OUR CONCLUSION AND RESULTS, INCLUDING FINDINGS AND OBSERVATIONS, AS WELL AS RECOMMENDATIONS. LASTLY, THE CITY PROVIDED MANAGEMENT ACTION PLAN. THIS IS MY FIRST PRESENTATION, AND SO FAR, SO GOOD. AS PART OF THE CITY OF MINNEAPOLIS OFFICE OF COMMUNITY SAFETY, THE NEIGHBORHOOD SAFETY D. PROVIDES PROGRAMS FOR PREVENTION, INTERVENTION, AND RESTORE ACTIVE SERVICES. N.S.D.
CONTRACTED SERVICES FOR $8. 1 MILLION OUT OF THEIR $10. 5 MILLION 2026 ANNUAL BUDGET. WITHIN N.S.D. , ROLES RADIO ASSIGNED FOR COORDINATING SERVICES ACROSS EACH CYCLE. ADMINISTRATORS PROVIDE FINANCIAL OVERSIGHT. PROGRAM MANAGERS PROVIDE PERFORMANCE OVERSIGHT. AND N.S.D. MUST ALIGN PRACTICES WITH THE REQUIREMENTS OF BOTH CITY POLICIES AND THE SETTLEMENT AGREEMENT. FOR THE OBJECTIVE OF THIS AUDIT, WE ASKED, IS THE NEIGHBORHOOD SAFETY DEPARTMENT PROVIDING SUFFICIENT CONTRACT OVERSIGHT AND MANAGING CONTRACTS EFFECTIVELY? THIS
AUDIT FOCUSED ON THEIR FINANCIAL AND OVERSIGHT PRACTICES DURING THE PERIOD BETWEEN JANUARY 1, 2020, THROUGH DECEMBER 31, 2025. WE ACKNOWLEDGE CHALLENGES IN REVIEWING ACTIVITIES UNDER SUCH A LONG TIME FRAME. THE CRITERIA FOR THIS AUDIT INCLUDED N.S.D. POLICIES AND PROCEDURES, BUT ALSO ENTERPRISE-WIDE POLICIES, SPECIFIC CONTRACT LANGUAGE, AND THE REQUIREMENTS OF THE COPPOLA SETTLEMENT AGREEMENT, WHICH FELL WITHIN THIS PERIOD OF REVIEW. OUR AUDIT WORK WAS CONDUCTED BY INTERVIEWING N.S.D. AND OTHER STAFF, BUT ALSO DOCUMENT REQUESTS AND REVIEWS LIKE POLICIES AND PROCEDURES, CONTRACTS AND
INVOICES, AS WELL AS OTHER RELEVANT SUPPORTING DOCUMENTATION. THIS AUDIT CONCLUDED THAT THE NEIGHBORHOOD SAFETY DEPARTMENT IS NOT PROVIDING SUFFICIENT CONTRACT OVERSIGHT OR MANAGING CONTRACTS EFFECTIVELY. THIS IS BASED ON SEVERAL FINDING FINDINGS AND OBSERVATIONS. FINDING ONE FALLS UNDER THE CATEGORY OF OVERSIXERS A LACK OF COMMUNICATION, AND ALIGNMENT LEADS TO AN INEFFECTIVE OVERSIGHT ENVIRONMENT AMONG NEIGHBORHOOD SAFETY DEPARTMENT CONTRACTS. FOR EXAMPLE, IDENTIFYING UNALLOWABLE EXPENSES OR HOW TO PROPERLY ESCALATE CONCERNS. WE OBSERVED THAT N.S.D. , FINANCE AND PROPERTY SERVICES, AND THE CITY
ATTORNEY'S OFFICE DOES NOT HAVE SHARED CONSISTENT OVERSIGHT PRACTICES. COMMUNICATION GAPS AND UNCLEAR ROLES LIMIT THE CITY'S ABILITY TO IDENTIFY RISKS OR RESPOND TO CONCERNS IN A TIMELY WAY. FOR FINDING ONE, WE ISSUE RECOMMENDATION ONE, WHERE O.C.S. , O.P.S. , N.S.D. AND THE C.A.O. ENSURE CLEAR ROLES AND RESPONSIBILITIES, PARTICULAR UNTIL SHARED PROCESSES. THESE DEPARTMENTS SHOULD ESTABLISH OR BETTER ESTABLISH PROCESSES FOR DISCUSSING ISSUES, NEEDS, OR OTHER CONCERNS TO HELP ALIGN PRACTICES WITH REQUIREMENTS, INCLUDING HOW TO REVIEW AND DOCUMENT DEVIATIONS.
THIS RECOMMENDATION PURSUES CLEAR AND CONSISTENT SUPPORT FOR CONTINUED COORDINATION AMONG THESE DEPARTMENTS. FINDING TWO FALLS UNDER THE CATEGORY OF INFLUENCE AND PRESSURE, WHERE WE FOUND THE CITY DOES NOT HAVE SUFFICIENT CONTROLS FOR MITIGATING PRESSURES OR POTENTIAL CONFLICTS OF INTEREST. FOR EXAMPLE, A DOCUMENTED ESCALATION PATH DOES NOT APPEAR TO EXIST FOR INSTANCES WHERE CONTRACTORS BYPASS CONTRACT MANAGERS. SUCH EXAMPLES HIGHLIGHT THAT THE CITY DOES NOT HAVE STRONG SAFEGUARDS THAT PROTECT THE CONTRACTING PROCESS FROM PRESSURE OR INFLUENCE. EXPECTATIONS FOR COMMUNICATION BETWEEN STAFF, ELECTED
OFFICIALS, AND CONTRACTORS ARE NOT CLEAR OR NOT DOCUMENTED. WE RECOMMEND LEADERSHIP FROM BOTH THE OFFICE OF COMMUNITY SAFETY AND OFFICE OF PUBLIC SERVICE AND ALSO THE C.A.O. TO ESTABLISH WITH PROCUREMENT GUIDANCE FOR DEPARTMENTS ON HOW TO MANAGE AND MITIGATE POTENTIAL PRESSURES AND MAKE SURE THERE'S CLEAR GUIDANCE FOR SITUATIONS LIKE CITY REPRESENTATIVES RESPONDING TO OUTREACH OR WHAT CONTRACTING DEPARTMENTS CAN SHARE WITH OTHERS NOT INVOLVED IN THE CONTRACTING PROCESS. FINDING THREE FALLS UNDER THE CATEGORY OF POLICIES AND PROCEDURES, WHERE WE FOUND THAT N.S.D.
DOES NOT HAVE COMPLETE OR FINALIZED POLICIES AND PROCEDURES FOR ITS CORE CONTRACTING WORK. N.S.D. HAS WORKED TO ESTABLISH SUCH DIRECTIVES DURING THE COURSE OF OUR YOU'DITY, BUT MANY DOCUMENTS REMAIN IN DRAFT FORM, WHICH LEAVE STAFF WITHOUT GUIDANCE AND CREATES UNEVEN PRACTICES ACROSS PROGRAMS. FOR EXAMPLE, N.S.D. HAS CREATED INVOICE PROCESSES FOR STANDARD AND ALTERNATIVE INVOICING, BUT MUST STILL ALIGN THESE WITH POLICIES AND THE REQUIREMENTS OF THE COPPOLA SETTLEMENT. WE RECOMMEND FOR FINDING THREE THAT N.S.D. LEADERSHIP, WORKING TOGETHER WITH THE CITY ATTORNEY'S OFFICE AND FINANCE &
PROPERTY SERVICES FINISH IN-PROGRESS POLICIES FOR ALL CONTRACTING STAFF, COMPREHENSIVELY INCORPORATE CITY EXPECTATIONS, AND THE REQUIREMENTS OF THE COPPOLA SETTLEMENT AGREEMENT AND PROVIDE WELL DOCUMENTED TRAINING TO STAFF AND NEW HIRES. FINDING FOUR RELATES TO THE INVOICING PROCESS. N.S.D. 'S INVOICING PROCESS DOES NOT FULL AL LINE WITH ENTERPRISE EXPECTATIONS OR COPPOLA SETTLEMENT REQUIREMENTS. FOR EXAMPLE, SOME CONTRACTORS SUBMITTED LIMITED DOCUMENTATION AND N.S.D. REQUESTED THE REMAINDER MONTHS LATER.
ADDITIONALLY, WE OBSERVED A LACK OF CROSS-DEPARTMENTAL ALIGNMENT ON THE INVOICING PROCESS. THIS INCREASES THE RISK OF PAYING FOR WORK THE CITY CANNOT FULLY VERIFY. THEREFORE, AS REFLECTED IN RECOMMENDATION FOUR, WITH THE CITY ATTORNEY'S OFFICE AND FINANCE AND PROPERTY SERVICES, N.S.D. SHOULD ESTABLISH A, CONSISTENT PROCESS FOR INVOICE REVIEW THAT IS IN ALIGNMENT WITH ENTERPRISE EXPECTATIONS. ALSO, N.S.D. SHOULD BUILD OUT AN INTERNAL COMPLIANCE FUNCTION THAT REGULARLY REVIEWS CONTRACTS CONTRACTS, INVOICES AND PAYMENTS. FURTHER, THE OFFICE OF PUBLIC
SERVICE LEADERSHIP SHOULD COORDINATE WITH N.S.D. ON DOCUMENTATION THAT ALLIANZ WITH ENTERPRISE EXPECTATIONS, INCLUDING RECORD STORAGE AND CONFIRM IT MATCHES OTHER DEPARTMENTS, NOTING ANY AGREED DEVIATION SAYS. FINDING FIVE, N.S.D. DOES NOT CONSISTENTLY TRACK OR DOCUMENT CONTRACTOR TRAINING, INCLUDING REQUIRED TWO-HOUR SESSIONS FOR CERTAIN VIOLENCE PREVENTION CONTRACTS. AS A RESULT, N.S.D. CANNOT RELIABLY SHOW THAT CONTRACTORS RECEIVED INFORMATION NEEDED TO FOLLOW CITY REQUIREMENTS. FOR FINDING FIVE, WE RECOMMEND THAT N.S.D. FORMALIZED ITS TRAINING FOR CONTRACT OVERSIGHT MANAGEMENT,
THEN MEMORIALIZE ITS TRAINING AND DIRECTIVES IT CAN SHARE WITH ALL CONTRACT ADMINISTRATIVE STAFF. FINDING SIX RELATES TO CONTRACTOR SITE VISITS. N.S.D. DOES NOT HAVE A STANDARDIZED PROCESS FOR CONDUCTING AND DOCUMENTING SITE VISITS. CURRENT SITE VISIT PRACTICE DEPENDS ON INDIVIDUAL PROGRAM MANAGER RELATIONSHIPS AND ROUTINE TOUCH POINTS RATHER THAN A STRUCTURED OR PROCESS WITH THE MONITORING SCHEDULE. THE FREQUENCY, CONTENT AND DOCUMENTATION OF THESE VISITS ARE INCONSISTENT, LIMITING THE DEPARTMENT'S ABILITY TO CONFIRM THAT SERVICES OCCURRED AS EXPECTED. WE RECOMMEND THAT N.S.D. MANAGEMENT FINALIZE THE SITE VISIT S.O.P. 'S THAT WERE
BEING DEVELOPED DURING THIS AUDIT, INCLUDING CRITERIA FOR FOLLOWING UP AND ESCALATING CONCERNS. FURTHER, N.S.D. SHOULD USE A RISK-BASED ASSESSMENT OF ACTIVE CONTRACTTORS TO SET EACH CONTRACTOR'S MONITORING SCHEDULE AND FEED THE CONTRACTOR MONITORING ASSESSMENT TOOL PILOTED IN APRIL. EVERY SITE VISIT SHOULD BE DOCUMENTED, AND N.S.D. SHOULD CONDUCT A REVIEW AT LEAST QUARTERLY TO CONFIRM MONITORING IS CONSISTENT ACROSS ALL CONTRACTORS AND PROGRAMS. FINDING SEVEN FALLS UNDER THE CATEGORY OF CONTRACT DOCUMENTATION AND CONTRACTOR COMMUNICATION. N.S.D. DOES NOT HAVE A DEPARTMENT-WIDE STANDARD FOR SAVING CONTRACT RECORDS OR DOCUMENTING COMMUNICATION WITH CONTRACTORS.
RECORDS ARE STORED IN DIFFERENT LOCATIONS AND FORMATS, WHICH COMPLICATES OVERSIGHT AND CREATES RISK WHEN STAFF TRANSITIONS. THEREFORE, WE RECOMMEND N.S.D. MANAGEMENT SET CLEAR POLICY EXPECTATIONS FOR PRESERVING CONTRACT-RELATED DOCUMENTS, COMMUNICATE THE POLICY TO STAFF, TRAIN CONTRACT AND PROGRAM MANAGERS, AND APPLY THESE PRACTICES CONSISTENTLY. O.P.S. AND O.C.S. , IN PARTNERSHIP WITH N.S.D. , FINANCE, PROCUREMENT, AND THE CITY ATTORNEY'S OFFICE AGREE TO THE AUDIT RECOMMENDATIONS AND HAVE DRAFTED A CORRECTIVE ACTION PLAN THAT CURRENTLY PROJECTS ACTION ITEMS ARE COMPLETE BY JUNE 30, 2027.
O.P.S. AND O.C.S. WILL COORDINATE MULTIPLE CITY RESOURCES PURSUANT TO INCREASING OVERSIGHT AND ACCOUNTABILITY. N.S.D. ENSURE PRACTICES COMPLY WITH THE REQUIREMENTS SET FORTH BY BOTH THE CITY AND THE COPPOLA SETTLEMENT AGREEMENT. THE OFFICE OF CITY AUDITOR WILL FOLLOW UP BY SEPTEMBER 30 FOR THE FIRST ANTICIPATED DELIVERABLE OF THE CORRECTIVE ACTION PLAN. THESE ENTITIES HAVE COMMUNICATED. WE THANK THE VARIOUS PARTNERS FOR THEIR PARTICIPATION IN THIS AUDIT AND HOPE WE HAVE PRODUCED A USEFUL REPORT. I THANK YOU FOR YOUR ATTENTION THROUGHOUT THIS PRESENTATION.
ARE THERE ANY QUESTIONS RELATED TO OUR REPORT, WHICH I HAVE PRESENTED HERE? ≫ THANK YOU FOR THAT PRESENTATION. DO ANY OF MY COLLEAGUES HAVE QUESTIONS? ≫ THANK YOU FOR THIS REPORT. I THINK THIS IS A REALLY IMPORTANT ISSUE, AND I'VE HAD CONCERNS AS WELL. I'M NOT TRACKING THE TIMELINE ON ALL THIS. I KNOW ONE CONTRACT WAS UP RECENTLY, AND I BELIEVE I'M EVEN SURE WHAT ENDED UP HAPPENING THERE. BUT THAT SAID, IN TERMS OF THE CONTRACTS, LITERAL CONTRACTS, THE LANGUAGE IN THE CONTRACT, IF A CONTRACTOR, YOU KNOW, ONE OF THESE ENTITIES IS DEEMED TO BE,
YOU KNOW, DOING GROSS MISCONDUCT OR REALLY NOT MEETING THE NEEDS, WHAT LEVEL IS THE CITY COMPELLED TO CONTINUE PAYING OR TO CONTINUE WORKING WITH THE CONTRACT? CAN WE TERMINATE THE CONTRACT? WHAT DOES THE LANGUAGE LOOK LIKE THERE? ≫ WE PROBABLY WOULD COMMENT OUTSIDE THE SCOPE OF THE CITY AUDITOR, AND MAYBE I'LL INVITE THE CITY AUDITOR UP TO MAKE A COMMENT AFTER. I WOULD SAY THAT GENERALLY WE'RE LOOKING AT THE CONTROLS, RATHER THAN THE INDIVIDUAL INSTANCES. WITH THE PARTICULAR CASE OF N.S.D. , WE FOUND THE CONTROLS COULD PROBABLY BE INCREASED OR STRENGTHENED SO THAT INDIVIDUAL OR SPECIAL INSTANCES ARE
MEETINGS CITY EXPECTATIONS. WITH THAT, I'LL HAND IT OVER TO THE CITY AUDITOR. ≫ CHAIR SINGLETON, COMMISSIONER ENGLEHART. LIKE THE DIRECTOR MENTIONED, THE SCOPE OF THIS AUDIT WAS RELATED TO HOW N.S.D. MANAGES THE CONTRACT AND NOT INTO INDIVIDUAL CONTRACT ITSELF. SO BASICALLY WE LOOKED AT WHAT KIND OF OVERSIGHT THE N.S.D. HAS REGARDING THE ALL-CONTRACT MANAGEMENT PROCESS, SO WE DIDN'T GO THROUGH INDIVIDUAL DETAILS REGARDING INDIVIDUAL CONTRACT ITSELF. BUT WE JUST WANTED TO,
FROM PROCESS STANDPOINT, WHETHER THERE'S ADEQUATE AND EFFECTIVE CONTRACT MANAGEMENT PROCESS, SO AS A PART OF THE SCOPE, IT WAS NOT OUR PART OF THE SCOPE REGARDING THOSE INDIVIDUAL CONTRACTS. ≫ THANK YOU. I MAY HAVE MISSED IT, IT'S A GOOD AND THOROUGH REPORT, BUT IS THERE A RECOMMENDATION TO ENHANCE THE ETHICS, THE CITY'S ETHICS POLICY? AS I WAS READING THROUGH SOME OF THE ASPECTS OF THIS MAYBE, ETHICS POLICY DOESN'T COVER IT. ≫ YEAH, SO WE HAVE THOSE RECOMMENDATIONS TO ENHANCE THE ETHICS POLICY AS WELL, AND ALSO
AS A PART OF THIS YEAR'S AUDIT PLAN AND STRATEGIC PLAN, WE HAVE ALSO INCLUDED TO LOOK AT THE ETHICS POLICY AND THOSE AS A PART OF THE FUTURE AUDIT BY END OF THE YEAR AS WELL. SO WE'RE GOING TO COMBINE THIS RECOMMENDATION AND THAT SEPARATE AUDIT AS A PART OF HOW THAT ETHICS POLICY AND THE TRAINING LOOKS LIKE IN THE CITY AS WELL, AND WHAT KIND OF ENHANCEMENTS, IF ANY, THAT NEEDS TO BE MADE SO WE HAVE A SEPARATE PLAN FOR THOSE PROCESSES IN THE FUTURE AS WELL. ≫ THANK YOU. ≫ THANK YOU, COMMITTEE MEMBER, FOR THOSE QUESTIONS. VICE
CHAIR? ≫ COMMITTEE MEMBER HOSBEIN. ≫ THANK YOU, VICE CHAIR. THANK YOU FOR THE PRESENTATION. I REALLY APPRECIATE THE KIND OF MULTIPLE LAYERS OF THE RESOLUTION, AND I THINK THIS IS A REALLY GREAT OPPORTUNITY WHEN IT DOES INVOLVE PROSECUTE CUREMENT AND FINANCE AND RESPONSIBILITY OUTSIDE OF THE SPECIFIC DEPARTMENT. WE COULD START MEMORIALIZING WHATEVER THOSE PRACTICES ARE, SO WHEN THE NEXT AUDIT COMES UP AND WE HAVE THE SAME FINDINGS,
THOSE HIGH-LEVEL DEPARTMENTS ARE ALREADY HAVING BEST PRACTICES, SO I GUESS MAYBE THE QUESTION IS THE QUESTION AND THE COMMENT, IS THERE, EVEN THOUGH IT'S NOT N.S.C. SPECIFIC, ARE THERE EXPECTATIONS THAT THE OTHER DEPARTMENTS INVOLVED START WORKING ON THOSE HIGH LEVEL OBJECTIVES AND CONSISTENT GUIDANCE WHEN THEY'RE BROUGHT INTO THESE MANAGER RESPONSES. ≫ YES, AND IT'S AN EXCELLENT QUESTION. WE BELIEVE THAT CITY LEADERSHIP HAS COMMITTED TO THOSE ACTIONS, WHICH WOULD STRENGTHEN THINGS LIKE OVERSIGHT AND ACCOUNTABILITY.
AND THAT WOULD BE A PROGRAMATIC FIX RATHER THAN AN INDIVIDUAL FIX. I THINK THAT ALONG THE LINES OF WHAT YOU'RE SUGGESTING, WE ALSO INCLUDE IN THIS REPORT AS RECOMMENDATIONS FOR CONTROLS THAT EITHER COULD BE STRENGTHENED OR COULD BETTER LEVERAGE THE EXPERTISE THAT EXISTS ACROSS THE CITY. ≫ THANK YOU. AND I THINK IN ABSENCE OF THAT ENTERPRISE RISK LEVEL THESE GROUPS ARE GOING TO HAVE TO FILL THAT SPOT, SO IT'S NOT JUST THE CITY AUDIT DEPARTMENT. SO THANK YOU. ≫ THANK YOU. ≫ COMMITTEE MEMBERS, DO I HAVE
ANY OTHER QUESTIONS? SEEING NO FURTHER QUESTIONS OR COMMENTS FROM COMMITTEE MEMBERS, I'LL DIRECT THE CLERK TO RECEIVE AND FILE THIS REPORT. I'LL NOW DIRECT STAFF TO PUBLISH THIS REPORT. MEMBERS, MAY I HAVE A MOTION. THANK YOU. THE CLERK WILL NOW CALL THE ROLL. ≫ MEMBER AL-MOWAFAK. ≫ YES. ≫ COMMITTEE MEMBER CHUGHTAI. ≫ AYE. ≫ ENGLEHART. ≫ AYE. ≫ HOSBEIN. ≫ AYE. ≫ PETERSON. ≫ AYE. ≫ VICE CHAIR SINGLETON. ≫ AYE.
≫ CHAIR PAYNE IS ABSENT. THERE ARE SIX AYES. ≫ THANK YOU. THAT MOTION CARRIES. COMMITTEE MEMBERS, OUR LAST ITEM OF NEW BUSINESS IS ITEM SIX, THE ENTERPRISE-WIDE OPEN CORRECTIVE ACTION PLANS, AND UPDATED PROCESS FOR MONITORING AND COMMUNICATING CORRECTIVE ACTION PLAN PROGRESS. WE WILL NOW BE JOINED AGAIN BY CITY AUDITOR, ROBERT TIMMERMAN. ≫ THANK YOU, CHAIR SINGLE TON, AUDIT COMMITTEE MEMBERS. WE'RE VERY EXCITED TO SHARE THIS PRESENTATION, BECAUSE IT GETS AT THE QUESTIONS YOU WERE ASKING, AND IT GETS AT QUESTIONS THAT CAME UP IN BOTH PRESENTATIONS AS FAR AS MONITORING, TRACKING, AND MOVING FORWARD WITH ENTERPRISE
RISK MANAGEMENT. I WOULD LIKE TO INTRODUCE NIKKI LANE, WHO HAS SINCE MY VERY FIRST DAY HERE BOTH 15 MONTHS AGO BEEN REALLY PUSHING FOR ENTERPRISE RISK MANAGEMENT AND ENHANCING THAT ACROSS THE ENTERPRISE. I THINK YOUR WORK HAS BEEN PHENOMENAL, AND I'M EXCITED TO INTRODUCE HER TO YOU TO SPEAK ABOUT THIS. WE'LL ALSO HAVE OUR QUALITY ASSURANCE MANAGER, JESSICA PETERSON, SPEAK DURING THIS PRESENTATION, AND THEN I'LL SPEAK TO THE OPEN CORRECTIVE ACTION PLAN. ≫ THANK YOU. AUDITOR TIMMERMAN,
GOOD MORNING, VICE CHAIR SINGLETON AND MEMBERS OF THE AUDIT COMMITTEE. MY NAME IS NIKITA LANE, AND I'M A STAFF AUDITOR HERE AT THE CITY. WE ARE GOING TO BE PRESENTING ON THE FOLLOWUP REQUEST FROM OUR APRIL 20 AUDIT COMMITTEE MEETING. WE WILL REVISIT THE AUDIT COMMITTEE PROCESS, THE NEW PROJECT TRACKER, THE UPDATED RISK CATEGORIES, UNRESOLVED AUDIT RECOMMENDATIONS, THE TABLEAU DASHBOARD, THE COMMUNICATION PROCESS, AND ENTERPRISE RISK MANAGEMENT. BUT FIRST, WE WANTED TO REFRESH EVERYONE'S UNDERSTANDING OF THE
CURRENT AUDIT COMMITTEE PROCESS, WHICH IS A RECEIVE AND FILE PROCESS, MEANING THAT THE OFFICE OF CITY AUDITOR PERFORMS AUDIT ENGAGEMENTS. THE AUDIT REPORTS ARE PRESENTED TO THIS BODY. THE COMMITTEE RECEIVES AND FILES THE REPORT. AND THAT PROCESS WORKS WELL WHEN FINDINGS ARE STRAIGHT FORWARD AND ARE NOT COMPLEX IN NATURE. THE AUDIT IS RESPONSIVE AND RESOURCES ARE READILY AVAILABLE. THE PROCESS DOES NOT FUNCTION AS INTENDED WHEN FINDINGS ARE COMPLEX , THEY'RE UNRESPONSIVE, AND RESOURCES ARE NOT READILY AVAILABLE TO RESOLVE THE FINDING. I WILL NOW TURN IT OVER TO JESSICA PETERSON TO DISCUSS
THESE NEW PROJECT TRACKERS. ≫ GOOD MORNING, VICE CHAIR SINGLETON AND MEMBERS OF THE AUDIT COMMITTEE. THANK YOU, NIKITA, FOR THE PRESENTATION. MY NAME IS JESSICA, AND I'M THE QUALITY ASSURANCE AND TRAINING MANAGER FOR THE OFFICE OF CITY AUDITOR. OUR OFFICE CONTINUES TO STRIVE FOR EXCELLENCE IN AUDIT WORK AND OPERATIONAL EFFECTIVENESS TO INCREASE AUDIT IMPACT AND VALUE TO THE CITY OF MINNEAPOLIS. OUR OFFICE RECOGNIZED THE OPPORTUNITY TO REFINE THE AUDIT FINDS PROCESS BY LEVERAGING TECHNOLOGY TO IMPLEMENT PROJECT MANAGEMENT TOOLS, TO EFFECTIVELY
OVERSEE THE PROGRESS OF OPEN MANAGEMENT ACTION ITEMS. WE HAVE PARTNERED WITH THE CITY'S I.T. DEPARTMENT TO CONSTRUCT A CUSTOM INTERFACE PLATFORM FOR OUR TEAM TO ENTER EACH AUDIT, EACH FINDING, RECOMMENDATION, AND MANAGEMENT ACTION ITEM FROM THE AUDITEE, PROJECTED DUE DATES ARE CAPTURED. AND EFFECTIVE DATES FOR IMPLEMENTATION OF NEW PROCESSES. WE ARE EXCITED TO SHARE THAT IN COLLABORATION WITH THE INFORMATION TECHNOLOGY DEPARTMENT, WE HAVE BUILT A POWER APP DATABASE THAT CAN BE USED TO DO MANY
THINGS, INCLUDING TRACK ALL OPEN AND CLOSED AUDITS, MONITOR FINDINGS, RECOMMENDATIONS, AND MANAGEMENT CORRECTIVE ACTION PLANS. SECURELY TRANSMIT TEXT AND FILE INFORMATION TO AUDITEES RELATED TO THEIR AUDIT FINDINGS. AUTOMATION SCHEDULED COMMUNICATION RELATED TO CORRECTIVE ACTION PLAN STATUS UPDATES, PROVIDE THE OFFICE OF CITY AUDITOR WITH CONSISTENT AND IMPROVED REPORTING CAPABILITIES. PROVIDE THE AUDIT COMMITTEE WITH ON-DEMAND ACCESS TO UNRESOLVED AUDIT RECOMMENDATIONS. AND MAKE RELEVANT INFORMATION AVAILABLE TO THE PUBLIC TONE
HANS TRANSPARENCY AND COMMUNITY OVERSIGHT. HAVING DEVELOPED THIS NEW TRACKING DATABASE INTERNALLY, THE OFFICE OF CITY AUDITOR HAS LEVERAGED AVAILABLE TALENT, BOTH INHOUSE AND THROUGH THE I.T. DEPARTMENT, OR INFORMATION TECHNOLOGY DEPARTMENT, TO SAVE PUBLIC FUNDS AND LEVERAGE ALREADY AVAILABLE RESOURCES. THIS ALSO ALLOWS US TO HAVE READILY AVAILABLE, COMPETENT SUPPORT, AND WE WOULD LIKE TO SPECIFICALLY THANK JEFF RIDER WITH THE INFORMATION TECHNOLOGY TEAM. HIS CONTRIBUTIONS HAVE CONTRIBUTED TO THE DEVELOPMENT OF THE SYSTEM.
MORE INFORMATION IS FURTHER EXPLAINED ON THE COMPANION REPORT, PAGES 4 AND 5. ADDITIONALLY, DEVELOPING THIS SYSTEM INHOUSE RATHER THAN USING A VENDOR MITIGATES RISK RELATED TO DATA LOSS AND DIGITAL SECURITY. THE POWER POINT SHOWS THE AUDITEE FINDINGS TRACKER SCREEN SHOT OF WHAT WE SEE ON OUR SIDE. THE HOME PAGE DISPLAYS ALL AUDITS ENTERED INTO THE DASHBOARD. THE FINDINGS TRACKER HAS THE CAPABILITY TO ORGANIZE EACH AUDIT TITLE BY YEAR, CAPTURE THE PROGRESS OF THE CORRECTIVE ACTION PLANS, AND GATHER ALL SUPPORTING DOCUMENTATION FOR
THE VALIDATION PROCESS TO CLOSE OUT FINDINGS. THE BOTTOM OF THE SCREEN SHOWS THE COLOR COORDINATED ASSOCIATED WITH THE STATUS, SO GREEN INDICATES CLOSED FINDINGS. YELLOW INDICATES OPEN FINDINGS. AND RED INDICATES THAT A FINDING IS PAST DUE. THE QUESTIONS FOR THE AUDITEE TO ANSWER FOR THE ACTION PLAN STEPS ARE DESIGNED TO BE CATEGORIZED BASED ON IDENTIFIED FOUR TYPES OF JUSTIFYING FACTORS CAUSING DELAYS IN APPLICATION, WHICH INCLUDE BUDGET, TECHNOLOGY, POLICY AND
PROCEDURE, AND CROSS-DEPARTMENTAL. EACH AUDITEE WILL EXPLAIN WHICH FACTOR IS IMPACTING THE EXTENUATING MANAGEMENT ACTION PLANS AND ARTICULATE THE REASONABLE EFFORTS COMPLETED TO ADDRESS AND OVERCOME THE CHALLENGES. THE AUDITEE CAN RELAY PROGRESS IN SEEKING THE CORRECTIVE ACTION PLANS, SUCH AS PROGRESS MEETINGS, REQUESTS BUDGETARY RESOURCES, DOCUMENTING CROSS-DEPARTMENTAL EFFORTS TO MITIGATE RISK, AND ATTACH SUPPORTING DOCUMENTATION. THE FULL AUDIT REPORT IS ATTACHED TO EACH AUDIT ENTRY. TO THE LEFT OF EACH AUDIT REPORT IN THE DASHBOARD IS A
LETTER ICON. THE AUDITOR WILL ENTER THE REPORT INTO THE DASHBOARD FOR THE AUDITEE TO REFERENCE AND OBTAIN CONTEXT OF THE FINDINGS AND RECOMMENDATIONS PROVIDED. THE RISK LEVELS ARE TRACKED PER FINDING AND RECOMMENDATION, SO WE HAVE LOW, MODERATE, AND HIGH. THE FINDING STATUS IS ALSO DOCUMENTED, SO WE CAN SEE THE OPTIONS HERE ARE OPEN, CLOSED, FUTURE AUDIT FOLLOW-UP, OR NOT APPLICABLE. WE HAVE A SEARCH FEATURE BOX FOR AUDITORS TO UTILIZE INTERNALLY. THE PIE CHART HE REPRESENTS THE DATA COLLECTED FROM THE
RESPONSES RECEIVED PERTAINING TO THE COMPLEX CHALLENGES IDENTIFIED. WE HAVE POLICY, BUDGET, CROSS DEPARTMENT, AS TECHNOLOGY. CURRENTLY, THIS GRAPH REPRESENTS 14 OUT OF 68 OPEN ITEMS. NOT EVERY SINGLE RESPONSE MUST IDENTIFY A CHALLENGE. IT CAN JUST SUBMIT A RESPONSE, AS WELL. MOVING FORWARD, WE WILL CONTINUE TO TRACK THESE CATEGORIES AND PROVIDE AN UPDATE ON THE DATA. NEXT, I WOULD LIKE TO DISCUSS THE TABLEAU DASHBOARD WHICH WAS ALSO CONSTRUCTED IN COLLABORATION IN-HOUSE WITH THE LEGISLATIVE DEPARTMENT TO SUPPORT AUDIT COMMITTEE ENGAGEMENT AND OVERSIGHT BY SHOWING EACH REPORT ON THE
DASHBOARD, ALSO THE ACTIONS ARTICULATED, THE AUDIT TOTALS ON THE DASHBOARD TO ALSO PROMOTE TRANSPARENCY AND ACCOUNTABILITY. HERE IS AN EXAMPLE OF WHAT THE DASHBOARD MAY LOOK LIKE. THIS IS BILLING REPORTS DIRECTLY FROM THE LIMS. CURRENTLY, THE AUDIT COMMITTEE DASHBOARD WILL DISPLAY OFFICE METRICS PER YEAR WHICH INCLUDE THE REPORT, THE NUMBER OF AUDIT PLANS, AUDIT REPORTS , TOTAL REPRESENTATION PROVIDED, AND STAFF DIRECTION UPDATES. WE WILL CONTINUE TO WORK IN COLLABORATION WITH THE CITY'S INFORMATION TECHNOLOGY DEPARTMENT TO BUILD A WEBPAGE
THAT PROVIDES THE TABLEAU DASHBOARD AND THE AUDITEE FINDINGS TRACKER FOR THE AUDIT COMMITTEE, TO HAVE THE TOOLS AND RESOURCES YOU ALL NEED TO STAY INFORMED. NOW I WILL TURN IT OVER TO ROBERT TIMMERMAN TO PRESENT ON THE OPEN MANAGEMENT ACTION ITEMS. ≫ ALL RIGHT, IN A, AUDIT COMMITTEE MEMBERS, I USUALLY GET MYSELF IN TROUBLE WHEN I GO OFF SCRIPT. WHAT I WANT TO SHARE IS THAT THE INFORMATION IN THE REPORT , IN CONJUNCTION WITH THE INFORMATION IN THIS PRESENTATION , AS WELL AS THE INFORMATION IN THE 80 SOME
PAGE APPENDIX, ALL TAKEN TOGETHER CAN PROVIDE A NICE OVERVIEW AND A THOROUGH OVERVIEW OF ALL OPEN CORRECTIVE ACTION ITEMS. HISTORICALLY, OUR OFFICE HAS REQUESTED CORRECTIVE ACTION UPDATES FROM MANAGEMENT, ODDITIES ON AN AD HOC BASIS. WE TYPICALLY REACH OUT TO OUR ODDITIES BEFORE EACH AUDIT COMMITTEE MEETING, TRY TO GET AN UPDATE, AND THIS PROCESS HAS WORKED OVER THE YEARS, BUT IT WAS TIME CONSUMING, INEFFICIENT. BUILDING THIS NEW SYSTEM WILL BE INCREDIBLY HELPFUL FOR
EFFICIENCY IN OUR OFFICE. THE INCREASING VOLUME OF OUR WORK HAS OUTPACED OUR ABILITY TO MANUALLY MONITOR AND FOLLOW UP ON CORRECTIVE ACTION PLANS, SO THE NEW DATABASE THAT JESSICA JUST TALKED TO YOU ABOUT, THE COOLEST PART ABOUT IT, YOU WILL ALL HAVE ACCESS TO IT. WE WILL ENSURE YOU HAVE DIRECT ACCESS TO IT, CAN DRILL DOWN INTO AUDITEE RESPONSES. AND YOU CAN DO THAT IN LONG TIME. THAT WAY, WE CAN BE COLLECTIVELY REPAIRED AND AUDIT COMMITTEE MEETINGS FOR SOME VERY GOOD DISCUSSION ON ANY OPEN ITEMS. THAT SAID, IN PREPARATION FOR THIS REPORT, WE DID AGAIN REACH OUT TO ALL AUDITEES WITH OPEN CORRECTIVE
ACTION PLANS, ASK THEM TO USE THE NEW DATABASE TO RESPOND TO US SO MAYBE A LITTLE BIT UNBEKNOWNST TO THEM, THEY WERE THE GUINEA PIGS FOR TESTING THIS OUT . WE REALLY DO THANK THEM FOR THAT. IT WILL TAKE SOME TIME TO TRANSITION STAKEHOLDERS INCLUDING THE AUDIT COMMITTEE, AUDIT STAFF, THE ADMINISTRATION IN USING THIS, BUT I THINK WE ARE UP TO A VERY GOOD START. I WILL MENTION THE TWO AUDIT REPORTS MENTIONED TODAY FOR AN SD AND MINNEAPOLIS, THEY ARE
NOT FACTORED INTO THE NUMBERS AND WHAT WE WILL SEE IN THE SLIDES, IN THE REPORT ITSELF. OVER THE NEXT FEW DAYS, WE WILL GET THOSE ADDED. MY HOPE IS IN THE NEXT FEW WEEKS WE CAN SEND YOU A LINK TO BE ABLE TO ACTUALLY GET INTO THE DASHBOARDS . LOOKING BACK, AND THIS IS QUESTIONS THAT I WOULD SAY HAVE COME UP AT SEVERAL OF THE LAST FEW AUDIT COMMITTEE MEETINGS. WHAT ARE OPEN FINDINGS? WE HAVE ALWAYS PROVIDED A NUMBER, BRIEF UPDATE. THE REPORT ITSELF GOES INTO GREAT DETAIL ON EACH OF THOSE. STARTING ON PAGE EIGHT, THAT IS WHAT ALIGNS WITH THE SLIDE ON THE SCREEN HERE. WE ARE LOOKING AT EACH AUDIT
THAT HAS OPEN FINDINGS YEAR-BY-YEAR. THE FIRST WAS A 2000 19 AUDIT THAT WAS PERFORMED ON POLICE OFF-DUTY WORK. IN THE REPORT, YOU WILL SEE THERE IS INFORMATION ABOUT MPD'S RESPONSE, THEY ARE STILL WORKING ON SOME OF THIS. THE FIRST FINDING WAS RELATED TO TECHNOLOGY ENHANCEMENTS FOR IMPROVING TRACKING, MANAGEMENT REPORTING, AND THE ANALYSIS OF POLICE OFF-DUTY WORK. BASED ON MPD'S RESPONSE ON THIS PARTICULAR ITEM -- AND
JUST TO MENTION, WE ARE ALSO REASSESSING ON ALL OPEN ITEMS THE RISK LEVEL . THE OFFICE OF CITY AUDITOR TRADITIONALLY CATEGORIZED EVERYTHING AS A HIGH RISK AND THAT IS NOT NECESSARILY APPROPRIATE WHEN WE HAVE A HIGH NUMBER OF AUDIT FINDINGS THAT NEED ATTENTION. SO WE HAVE TO BE MORE CRITICAL OF HOW WE ARE DOING THAT . AND IF YOU SLIDES, I WILL EXPLAIN HOW WE HAVE DEVELOPED OUR LOW, MODERATE, HIGH EVALUATION FOR THE FINDINGS. BUT FOR NOW, THE FIRST FINDING OF POLICE OFF-DUTY WORK, WE HAVE REEVALUATED FROM HIGH TO MODERATE. THIS PARTICULAR ITEM HAS NOT SEEN PROGRESS. THE MPD IS
STILL USING THE SAME SIGN IN SYSTEM. THEY HAVE NOT GONE TO A FIVE DIGIT CALLSIGN, WHICH WE RECOMMENDED AT THE TIME. THEY ARE USING A FOUR-DIGIT CALLSIGN. THE REALITY OF THIS , WHAT THE OFFICE OF CITY AUDITOR RECOMMENDS ON THIS ONE, BECAUSE IT IS NOW SEVEN YEARS OLD, AND THE MPD IS CONTINUING TO USE THE SAME SYSTEM THAT THEY HAVE USED. WE CLASSIFY THIS AS AN ITEM THAT HAS BEEN ACCEPTED, THE WRIST HAS BEEN ACCEPTED BY MPD. WHETHER THAT IS RIGHT OR WRONG. WHAT WE ARE GOING TO DO IS WE ARE GOING TO MARK THIS PARTICULAR ITEM AS CLOSED IN OUR TRACKER. WE WILL MARK IT AS
CLOSED IN THE TRACKER AND THEN WE BUILD A NEW AUDIT ON THIS SUBJECT. WHAT THE TRACKER DOES IS IT ALLOWS US TO MAINTAIN EVERY SINGLE FINDING, BUT IT CLOSED ON TIME, WHETHER IT WAS BEYOND ITS TARGET DATE, IT WILL ALWAYS BE IN THERE. SO THAT WHEN WE HIT THE NEXT AUDIT, WE REVIEW IT. I GET THE FEELING, WHY WOULD WE CLOSE SOMETHING THAT'S BEEN OPEN FOR SEVEN YEARS? THAT DOESN'T MEAN IT IS NOT STILL AN ISSUE, NOT SOMETHING THAT DOESN'T CAP FOLLOW-UP. BUT WHAT WE ARE TRYING TO DO AS A PART OF OUR DISCUSSION ON ENTERPRISE RISK MANAGEMENT, AS A DISCUSSION ON THE ADMINISTRATION TAKING RESPONSIBILITY FOR THEIR AUDITS AND FOR THEIR CORRECTIVE ACTION PLANS, THAT THEY HAVE SELF IDENTIFIED THAT THEY SET TARGET
DATES FOR. I THINK THAT WE NEED TO TRANSITION TO THAT ENTERPRISE RISK MANAGEMENT ACCOUNTABILITY OF BEEN MONITORING THIS. AND THIS IS BASED ON INTERNAL CONTROL STANDARDS. AUDIT'S ROL L IS, THE NEXT TIME THAT WE AUDIT, WE ASSESS WHETHER OR NOT THAT FINDING IS STILL OPEN, WHETHER THAT FINDING HAS BEEN ADDRESSED, AND THEN WE ESCALATE THAT AUDIT. FOR EXAMPLE, IF WE WERE TO GO IN AND AUDIT POLICE OFF-DUTY NOW, HAD TO BE CLOSE THAT FINDING AS A RISK ACCEPTED BY MANAGEMENT, WE WOULD GO IN AND SAY, WE DON'T AGREE WITH YOUR ASSESSMENT THAT YOU HAVE CLOSED THIS RISK.
WE ARE NOW GOING TO ELEVATE IT FROM A MODERATE ISSUE TO A HIGH ISSUE. EVERYTHING KIND OF PLACE TOGETHER AS FAR AS THE ASSESSMENT OF RISK. THE RESPONSIBILITY OF ADMINISTRATION ARE TRACKING. ULTIMATELY, THE WAY INTERNAL AUDIT IS SUPPOSED TO WORK IS THAT THE MONITORING IS THE RESPONSIBILITY OF MANAGEMENT, OF THE AUDITEE, AND THE AUDITOR THEN REASSESSES THE NEXT TIME THEY AUDIT A PARTICULAR PROGRAM. THAT IS NOT THE WINDOW -- THE WAY THINGS HAVE BEEN HAPPENING. IF WE SEE ENTERPRISE RISK MANAGEMENT AND
THAT FUNCTION MOVE FORWARD, AS WE HAVE PUSHED FOR, WE SHOULD BE ABLE TO WORK THIS. WHAT I'M TELLING YOU IS THIS DOESN'T ACTUALLY GO AWAY. IT MEANS THAT IT IS SEVEN YEARS OLD, IT DOESN'T LOOK LIKE THERE WILL BE PROGRESS ON THIS, SO THE NEXT TIME WE AUDIT THEM, THE ISSUE WILL BE ELEVATED. WE WILL CONTINUE TO DISCUSS IT. I CAN ANSWER QUESTIONS ON THAT PROCESS AS WE GET NEAR THE END OF THE PRESENTATION, BUT I WANTED TO TALK ABOUT HOW ALL OF THOSE THINGS PLAY TOGETHER. THE SECOND FINDING ON 2019 POLICE OFF-DUTY AUDIT, A LITTLE BIT DIFFERENT ON THIS ONE. YOU WILL SEE YOU ON
PAGE SIX OF THE REPORT, WE HAVE A TABLE THAT INDICATES ALL OF THE OPEN FINDINGS, ALL OF THE OPEN CORRECTIVE ACTION PLANS, BUT WE BELIEVE THE AUDIT COMMITTEE SHOULD DO WITH THESE. THIS IS WHERE WE SAY THEY SHOULD ABSOLUTELY COME IN FRONT OF THE AUDIT COMMITTEE AGAIN. WHETHER THAT IS IN OCTOBER WHICH IS WHAT WE ARE PROPOSING, BECAUSE THERE IS A LOT OF THEM, AND IT WOULD TAKE FOLLOW-UP TO GET LIMITATIONS OUT. RECOMMENDATIONS WITHIN THE REPORT ARE AT ANY FINDING THAT WE HAVE SENT YOU COME BEFORE THE AUDIT COMMITTEE, THE AUDIT SHARE DRAFT A FORMAL LETTER. I CAN HELP DO THAT. AND SEND THAT TO THE ADMINISTRATION, TO COME WITH A
RESPONSE PREPARED. WE HAVE A SLIDE THAT SHOWS EXACTLY WHAT WE WOULD WANT THE ADMINISTRATION TO PRESENT TO THE AUDIT COMMITTEE. SO THERE IS A PLAN FOR NEXT STEPS, RECOMMENDATION FOR THE AUDIT COMMITTEE ON BRINGING AUDITEES IN FRONT OF THIS BODY, IF THEY HAVE NOT CLOSED. THAT SAID, IF WE HAVE SOMETHING THAT WE SAY THE ADMINISTRATION SEEMS TO HAVE ACCEPTED THE RISK ON THIS, WE DO STILL HAVE THEM COMING. WE CAN ASK. WITH THE SECOND FINDING ON THE 2019 POLICE OFF-DUTY WORK, THIS IS ONE THAT WE STRONGLY
SUGGEST THAT THE AUDIT COMMITTEE BRING IN FRONT OF THEM IN OCTOBER. I CAN HELP COORDINATE WITH THE CHAIR OF THE AUDIT COMMITTEE TO DRAFT THAT LETTER, EXPECTATION FOR WHAT IS PRESENTED. WITH THIS PARTICULAR ITEM, IT IS TRULY THE MONITORING OF OVERTIME. THIS IS WHERE THE MAIN PROBLEM IS. THIS IS AN ISSUE WHERE WE MAINTAIN A HIGH RISK CLASSIFICATION FOR. I THINK THAT WHEN YOU TAKE OFF-DUTY WORK, AND YOU TAKE OVERTIME WORK, AND YOU LOOK AT THE TOTAL NUMBER OF WORK HOURS, IT ALSO PRESENTS A REAL SAFETY RISK TO THE CITY WHEN OFFICERS ARE WORKING AS MANY HOURS AS THEY
ARE. IF YOU REMEMBER FROM THIS REPORT, MANY OTHER CONVERSATIONS THE COUNCIL HAS HAD WITH MPD, THIS IS A REAL ISSUE, AND WE NEED TO MAKE SURE THAT WE FOLLOW UP ON IT. THERE IS A THIRD FINDING VERY SIMILAR IN NATURE THAT I THINK WE SHOULD CONTINUE TO ASK MPD ABOUT , BUT THIS IS ONE WHERE THEY HAVE MADE SOME PROGRESS ON. IN THE REPORT ON PAGE NINE, THE DETAIL SOME OF THE PROGRESS ACTIONS. THIS ONE, I WOULD SAY, IS NOT ACCEPTING BASED ON THEM ACCEPTING THE RISK. THEY IDENTIFIED THE MITIGATING FACTORS THAT THEY HAVE
IMPLEMENTED WHICH SATISFIED THE AUDIT FINDINGS. I WOULD SUGGEST THAT WITH THIS PARTICULAR ITEM, THE WAY THAT WE SET IT UP FOR OCTOBER, WE HAVE EACH AUDITEE OR DEPARTMENT SPEAK TO A PARTICULAR AUDIT, AND THEN WE TRANSITION TO THE NEXT AUDIT. EVEN IF WE ARE SAYING FOR TRACKING PURPOSES THAT WE MAKE SURE THAT WE TALK TO THAT AUDITEE ON ANY OF THE FINDINGS OF THE REPORT, NOT JUST THE ONES THAT ARE OPEN. LET'S GET UPDATES ON THE ONES THAT ARE CLOSED OVER TIME AS WELL. SO THAT SETS THE STAGE. WE WILL GO THROUGH EACH YEAR. WE DIDN'T HAVE ANY REPORTS IN 2020 THAT HAD OPEN CORRECTIVE
ACTION ITEMS. 2021, THERE WERE FIVE WITH 12 TOTAL FINDINGS. ONE OF THOSE HAS A PAST DUE MANAGEMENT CORRECTIVE ACTION ITEM. ON PAGE 10 OF THE REPORT, YOU WILL SEE THAT. THAT IS FINDING FOUR OF THE PERSONAL ISSUED MOBILE DEVICES POLICY. WE RECEIVED RESPONSES FROM I.T. , RECEIVED RESPONSES FROM THE CLERK'S OFFICE, WE RECEIVED RESPONSES FROM THE CITY'S ATTORNEY'S OFFICE ON THIS PARTICULAR ITEM. THEIR RESPONSE IS ON PAGE 10 AND 11. THEY HAVE UPDATED THIS POLICY, THEY HAVE DONE SOME TRAINING ON THIS. TIME HAS GONE BY AND THEY ARE NOW REVIEWING TO UPDATE THIS POLICY AGAIN. BASED ON THE INFORMATION THEY PROVIDED, WE ARE SATISFIED TO
CLOSE THIS PARTICULAR FINDING. THAT IS THE EXTENT OF ANY OPEN FINDINGS FOR 2021. 2022, THERE WERE THREE AUDITS THAT HAD 30 TOTAL FINDINGS. NONE HAD OPEN MANAGEMENT ACTION ITEMS, SO WE DON'T HAVE ANYTHING TO TOUCH ON THERE. 2023 GETS A LITTLE MORE FULL. MOST OPEN CORRECTIVE ACTION ITEMS ARE OF COURSE MORE CURRENT. AS WE GET CLOSER TO 2025 AND 2026, YOU WILL SEE THAT AS THE VOLUME INCREASES. FOR 20 23, THERE ARE A FEW AUDITS THAT HAVE OPEN CORRECTIVE ACTION ITEMS. YOU WILL NOTICE WE ARE ALSO TRYING TO CHANGE THE
LANGUAGE THAT WE USE. THESE ARE MANAGEMENT CORRECTIVE ACTION PLANS. THESE ARE ITEMS, IN RESPONSE TO FINDINGS AND RECOMMENDATIONS FROM THE CITY AUDITOR, MANAGEMENT, ADMINISTRATION, AUDITEE, WHATEVER TERM YOU USE, THEY DEVELOPED THE CORRECTIVE ACTION PLAN. THEY SET THEIR INITIAL TARGET DATE, AND ULTIMATELY THEY ARE RESPONSIBLE THEN FOR COMPLETING THE CORRECTIVE ACTION PLAN. THE MONITORING THAT WE HAVE BEEN DOING, WILL STRENGTHEN WITH THIS NEW SYSTEM IN OVERSIGHT, IS TO REALLY KEEP TABS ON THAT. TO MAKE SURE IT DOESN'T GET SEVEN YEARS OF STALE. IF MANAGEMENT ACCEPTS RISK,
THEY ARE COMING IN FRONT OF THE AUDIT COMMITTEE TO SAY HERE IS WHY WE BELIEVE WE CAN ACCEPT THE RISK. 20 23, SEXUAL ASSAULT EXAMINATION SHIP. I CANNOT GO INTO THE DETAILS ON THIS BECAUSE THE FINDINGS WERE REDACTED BECAUSE IT IS VERY SECURITY SENSITIVE. THE LAST TIME MPD AND PROPERTY EVIDENCE CAME BEFORE THE AUDIT COMMITTEE, WE HAD A CLOSED SESSION IN JUNE OF LAST YEAR. I WOULD SUGGEST FOR ANYTHING OPEN STILL RELATED TO THIS CAR PROPERTY AND EVIDENCE THAT HAVE REDACTED RESPONSES, REDACTED FINDINGS, THAT WE ALSO HAVE A CLOSED SESSION TO DISCUSS THOSE. YOU WILL HAVE REASON TO KNOW THE UPDATES ON THOSE AREAS. WE
JUST HAD TO BE SOMEWHAT MINDFUL OF THE SECURITY ON WHAT WAS PRESENTED HERE. WHAT I WILL SAY IS THAT WITH THE FIRST FINDING ON THE SEXUAL ASSAULT EXAMINATION KIT, THE PRIMARY REASON FOR DELAY IS COST. LET'S KEEP IN MIND THIS IS THREE YEARS PAST NOW . THE COST OF THIS PROJECT, WHICH WOULD REQUIRE SOME CONSTRUCTION, IS ESTIMATED AT ROUGHLY $300,000. I WOULD SAY THIS IS AN INCREDIBLE RISK TO THE CITY WITH A HIGH RISK CLASSIFICATION THAT DOES NOT CHANGE. MPD SHOULD PRIORITIZE THIS. THIS IS ONE I WOULD STRONGLY SUGGEST THAT WE BRING IN FRONT OF THE AUDIT COMMITTEE IN OCTOBER. THE SECOND ITEM IS
ACTUALLY RELATED, THE LANGUAGE IS DIFFERENT IN THE FINDING ITSELF, BUT WE WILL JUST SAY IT IS BUDGET RELATED WITH THE SAME AMOUNT. THAT MOVES US INTO REVENUE AND COLLECTIONS AUDIT PHASE ONE. THIS PARTICULAR REVIEW IN 2023 LOOKED AT THE MINNEAPOLIS ANIMAL CARE AND CONTROL, HOW THAT AREA IS MANAGED. PROPERTY SERVICES, HOW THE INTERPLAY WITH ONE ANOTHER. THIS IS ANOTHER ONE THAT WAS HIGH-SECURITY, SO THE ITEM IS REDACTED. THIS ONE, IT SOUNDS LIKE WE SHOULD BE ABLE TO ACTUALLY VERIFY THE SECURITY FEATURES THAT THEY HAVE USED TO MITIGATE THIS RISK BY MID AUGUST. IF YOU
GO BACK TO THE TABLE ON PAGE NINE, IT SHOWS ANOTHER COLUMN OF THINGS THAT WE SHOULD BE ABLE TO VERIFY BASED ON THE UPDATES THAT WE GOT. THERE ARE SEVERAL THAT WE SHOULD BE ABLE TO CLOSE OUT AFTER MID AUGUST. THIS IS ONE OF THOSE. BASED ON THEIR RESPONSE, WE WERE NOT COMFORTABLE CLOSING IT OUT, BUT THEY PROVIDED ENOUGH INFORMATION WHERE WE SHOULD BE ABLE TO PHYSICALLY VERIFY THE MITIGATION. THE SAME IS TRUE ON FINDING SEVEN ON THAT SAME AUDIT. THAT MOVES US INTO 2024. 2024, THERE WERE SIX AUDITS. PROPERTY AND EVIDENCE.
THIS IS ANOTHER ONE WHERE THERE ARE SEVERAL FINDINGS THAT ARE STILL OPEN. THEY ARE PAST DUE. ON THAT TABLE ON PAGE NINE, EACH OF THE ORIGINAL TARGET DATE THAT MANAGEMENT ITSELF ESTABLISHED. THE FIRST FINDING ON THE PROPERTY AND EVIDENCE AUDITS, THAT WAS ANOTHER ONE THAT WAS REDACTED AS HIGH-SECURITY. IN FACT, IT IS RELATED TO THE ONE THAT IS IN THE SEXUAL ASSAULT AUDIT. THAT IS THE SAME ISSUE THAT WE WOULD ASK MPD TO COME TO SPEAK TO IN A CLOSED SESSION TO THE AUDIT COMMITTEE. THAT IS ONE WHERE THEY ARE SAYING THAT THEY ARE CONTINUING TO WORK WITH MPD EXECUTIVE
LEADERSHIP , THAT THEY HAVE SPOKEN WITH OTHER PARTNERS ACROSS THE CITY, THAT THEY CURRENTLY DON'T HAVE THE BUDGET FOR IT. WE NEED TO BE VERY STRONG IN ENCOURAGING THE CITY COUNCIL TO HELP FUND THAT, FIND FUNDING FOR THAT, IF MPD CANNOT DO IT ON THEIR OWN. I WILL SAVE MY COMMENTS ON WHETHER OR NOT THEY SHOULD BE ABLE TO DO IT ON THEIR OWN FOR A LATER CONVERSATION. FINDING TWO IN THAT REPORT, VERY SIMILAR IN NATURE, HIGH RISK CLASSIFICATION. I BELIEVE IT IS THE SAME ISSUE. FINDING FOUR IN THAT REPORT IS STILL OPEN. WE RECOMMEND THAT MPD COME AND SPEAK TO THE AUDIT COMMITTEE IN OCTOBER AT THAT SAME MEETING WE HAVE BEEN PROPOSING. THIS ONE
IS ON A NEW ROOF ON THE PROPERTY AND EVIDENCE WAREHOUSE. THIS IS AN ITEM THAT HAD BEEN EVALUATED AS HIGH RISK. WE ARE REASSESSING AS MODERATE RISK. THE REASON FOR THAT, MY INITIAL REACTION IS, IF THE ROOF FLOODS BECAUSE OF LEAKS AND WE DAMAGE PROPERTY AND EVIDENCE, THAT IS AN INCREDIBLY HIGH RISK. THEY DO PROVIDE UPDATES ON MITIGATING FACTORS, IMMEDIATE REPAIR TO ANY DAMAGE, IMMEDIATE REPAIR TO ANY LEAKS. THAT SAID, IT IS STILL A SIGNIFICANT PROJECT THAT NEEDS TO BE UNDERTAKEN. WHEN WE WEIGH RISK,
WE THINK OF TWO THINGS, THE LIKELIHOOD OF THE RISK OCCURRING. WHAT I EXPLAIN WAS THE WHOLE ROOF COLLAPSING, THE LIKELIHOOD OF THAT IS VERY SMALL. BUT THEN WE ALSO CONSIDER THE IMPACT IF THAT ACTIVITY OR ACTION WERE TO OCCUR. IN THIS CASE, THE IMPACT WOULD BE SEVERE. THAT IS A TASTE OF HOW WE IDENTIFY RISK. WE WILL GET TO THAT SLIDE. THAT ONE, THEY HAVE SAID THAT SIGNIFICANT MAINTENANCE HAS BEEN COMPLETED. THEY NEED $3 MILLION FOR THE ROOF. THEY HAVE PUT IN A CAPITAL BUDGET REQUEST FOR THAT. IT SEEMS LIKE THEIR TIMELINE IS 2026 TO 2031.
I BELIEVE OCTOBER IS A GOOD TIME TO BRING THEM IN. FINDING STAFF, SOME VISUAL INDICATORS AND SIGNS THROUGHOUT FACILITIES TO REMIND OFFICERS TO PROPERLY DO THIS. THEN A SECOND TRAINING WHICH WAS VIDEO. THIS ONE WE ARE COMFORTABLE CLOSING. FINDING SEVEN IN THAT REPORT TALKED ABOUT PROPERTY WAREHOUSE LOCKERS AND THE INCONSISTENCIES IN DESCRIPTIONS, TEMPORARY EVIDENCE STORAGE. THIS ONE, TOO, MPD PROVIDED ENOUGH INFORMATION FOR US TO FEEL COMFORTABLE CLOSING THIS. THEY HAVE DEVELOPED TRAINING FOR NEW OFFICERS THAT TOUCH ON THIS. THEY HAVE CREATED NEW TRAINING VIDEOS FOR NEW OFFICERS. AGAIN,
THEY HAVE UPDATED SOME SIGNAGE. THEY DID MORE THAN THEY HAD INITIALLY COMMITTED TO ON THAT ONE. FINDING NINE, SIMILARLY, THIS ONE CAN BE CLOSED. MPD WILL BE ADDING A QUALITY ADMINISTRATOR POSITION TO THE PROPERTY AND EVIDENCE UNITS IN 2026. THEY HAVE ETHICS TRAINING IMPLEMENTED IN 2024 AND THEY HAVE LANGUAGE IN THEIR POLICY ABOUT CONFLICTS OF INTERESTS. THOSE THINGS HAVE BEEN IMPLEMENTED. ONE MORE I BELIEVE FOR 2024. THERE ARE A LOT OF FINDINGS IN THIS ONE, BUT THIS IS THE MPD FLEET MANAGEMENT AUDIT.
THIS ONE WE HAVE SEVERAL AUDIBLE WHERE WE THINK THEY SHOULD COME BEFORE THE AUDIT COMMITTEE IN OCTOBER TO EXPLAIN THEIR PROGRESS OR LACK THEREOF IF THAT IS THE CASE, OR TO DOCUMENT ANY FINDINGS THAT HAVE BEEN CLOSED THAT YOU MAY HAVE QUESTIONS ON. THE FLEET MANAGEMENT AUDIT FINDING ONE TALKED ABOUT ACCIDENT INVESTIGATIONS THAT ARE DELAYS IN INVESTIGATING VEHICLE ACCIDENTS INVOLVING MPD EMPLOYEES LEADING TO A BACKLOG OF CASES. THIS ONE, MPD PROVIDED A LENGTHY RESPONSE WHICH YOU WILL SEE ON PAGE 17 OF THE REPORT, TALKING ABOUT CASES HAVE CONTINUED TO BE ASSIGNED, THERE IS STILL SIGNIFICANT STAFFING ISSUES. IT SEEMS THERE IS ONLY ONE PERSON
TRAINED IN THE CERTAIN SYSTEMS OR INVESTIGATIVE TECHNIQUES FOR THIS. ALTHOUGH WE DO RECOMMEND REDUCING THE RISK ASSESSMENT FROM HIGH TO MODERATE ON THIS , BECAUSE AGAIN AT THAT HIGH RISK WE ARE THINKING ABOUT IS THEIR RISK OF IMMEDIATE HARM, SAFETY, DEATH. THESE ARE AFTER-THE-FACT INVESTIGATIONS. IF THIS WERE A FINDING THAT WE COME ACROSS REPETITIVELY OR A SECOND TIME ON THE NEXT AUDIT, THAT GIVES US ROOM TO ESCALATE IT THEN. UNDER OUR NEW CRITERIA FOR EVALUATING RISK ON OUR
FINDINGS, THIS WOULD FALL IN THAT MODERATE RANGE. SO THAT WHEN WE RECOMMEND THE AUDIT COMMITTEE BRING THAT IN FRONT OF THE BODY IN OCTOBER. FINDING TWO WAS RELATED TO FLEET POLICIES AND PROCEDURES. MPD POLICIES AND PROCEDURES REGARDING FLEET NOT FULLY UPDATED TO REFLECT PRACTICES AND IMPLEMENTATIONS. THE UPDATED MPD PROVIDED TO US, THE MOST RECENT MORE THOROUGH UPDATES THEY SENT TO US IN APRIL OF THIS YEAR. THEY DID RESPOND, TOLD US TO PLEASE RE FER TO THE RESPONSE
PROVIDED IN APRIL. THERE HAD NOT BEEN PROGRESS SINCE THEN. WE HAVE A FOLLOW-UP MEETING WITH THE CHIEF OF STAFF WITH THE MINNEAPOLIS POLICE DEPARTMENT THIS WEEK TO GET ADDITIONAL UPDATES ON ALL MPD FINDINGS. I AM VERY PLEASED THAT WE HAVE BEEN ABLE TO CREATE A STRONG RELATIONSHIP IN THAT ROLE WITH THAT INDIVIDUAL BECAUSE WE TYPICALLY WILL REPORT OUR FINDINGS, REQUEST UPDATES ACROSS MANY INDIVIDUALS IN MPD. THAT HAS BECOME PROBLEMATIC BECAUSE WE HAVE SO MANY
FINDINGS, MPD HAS SO MUCH TRANSITION WITH PERSONNEL ACROSS THE DEPARTMENT. AS WE KNOW, AT THE TOP, AS WELL. THE CHIEF OF STAFF IS A NICE CONDUIT FOR THOSE CONVERSATIONS. GOING FORWARD, ALL COMMUNICATION WE ARE GOING TO HAVE IS WITH THE CHIEF, THE CHIEF OF STAFF. THERE MAY BE TIMES WHERE WE REACH OUT TO OTHER INDIVIDUALS IF WE NEED TO GET INTO THE WEEDS MORE, BUT ULTIMATELY FOR MPD, THAT IS WHERE THE RESPONSIBILITY LIES, AT THE TOP EXECUTIVE LEVEL. THAT SHOULD MAKE OUR LIVES A LITTLE BIT EASIER AND THEY SHOULD BE ABLE TO FACILITATE PROVIDING UPDATES TO THE OFFICE OF CITY AUDITOR AND TO THE AUDIT COMMITTEE.
FINDING TWO, THEY SHOULD COME IN OCTOBER. FINDING THREE IS RELATED TO GPS AND VEHICLE TRACKING. THIS IS ONE THAT THEY INDICATED AS READY TO BE CLOSED. THEY HAVE TAKEN THE STEPS NECESSARY TO MITIGATE THE RISKS WE HAD IDENTIFIED THIS WEEK. WE NEED TO PHYSICALLY VERIFY OR. RECEIVE SOMEEVIDENCE ON BY MID AUGUST, WE SHOULD BE ABLE TO DO THAT AND CLOSE THAT PARTICULAR FINDING. . FINDING FIVE ON PAGE 20 IS RELATED TO EXTERNAL FUEL CARDS. EXTERNAL FUEL CARDS, REGARDLESS OF SECTOR, ARE ALWAYS A RISK TO AN ORGANIZATION. ON THIS ONE, MPD HAS STATED
THAT THEY HAVE COMPLETED THIS. THEY HAVE TAKEN THE ACTIONS NECESSARY TO MITIGATE THE RISK. AS I MENTIONED, WE HAVE A MEETING LATER THIS WEEK BUT THE CHIEF OF STAFF TO FURTHER VERIFY THIS AND WE CAN HOPEFULLY CLOSE THIS BY MID AUGUST. FINDING SIX ON THIS REPORT, THE AUDITEE SAYS THAT THEY ARE STILL IN PROGRESS ON THIS, SO THIS IS ONE THAT WE SUGGEST THEY COME IN FRONT OF THE AUDIT COMMITTEE IN OCTOBER. THIS IS RELATED TO ENHANCEMENTS FOR OVERSIGHT AND CONTROLS, FLEET FUNCTIONS. THEY HAVE MADE SOME PROGRESS IN THIS AREA, BUT WE NEED TO KNOW WHAT A REALISTIC NEW TIMELINE WILL BE FOR THEM. SO OCTOBER WILL BE A GREAT TIME FOR THEM.
FINDING EIGHT, RISK MANAGEMENT ALIGNMENT. WE TALKED ABOUT OPPORTUNITIES BETWEEN MPD AND RISK MANAGEMENT FOR ALIGNING ON A VEHICLE ACCIDENT DOCUMENTATION, PROCESSES. MPD SAYS THEY ARE STILL WORKING ON THIS. THIS IS ONE WHERE WE SHOULD GET AN UPDATE FROM THAT IN OCTOBER. FINDING 10, I BELIEVE THE LAST OF THIS PARTICULAR AUDIT. THAT IS THE VEHICLE MANAGEMENT SYSTEM. IT NEEDS ENHANCEMENTS. THE DETAILS OF THAT ARE IN THE REPORT ITSELF WHICH ARE IN THE APPENDIX, IN THE ORIGINAL AUDIT REPORT, WHICH IS IN THE APPENDIX TO THIS REPORT. MPD SAYS THEY ARE NEAR COMPLETION
ON THIS ONE. THIS IS ANOTHER ONE THAT WE SHOULD BE ABLE TO VERIFY. WE ARE GETTING NEAR THE END. 2025 AUDITS, THE FIRST ONE STARTING ON PAGE THREE, RESPOND TO A FEDERAL LAW ENFORCEMENT OPERATION. IF YOU REMEMBER, THIS WAS THE FIRST TIME THAT THERE WAS OBSERVATION OF ICE IN THE CITY ON JUNE 30, 2020 FIVE. WE HAD DONE A NARROW SCOPE REVIEW OF THE CITY'S RESPONSE TO THAT, BOTH THE ADMINISTRATION'S RESPONSE AND THE COUNCIL'S RESPONSE, HOW
THEY ENTER PLAYED. -- INTERPLAYED. THESE WERE NOT FINDINGS IN THE TRADITIONAL SENSE, THIS WAS A VERY LIMITED SCOPE ADVISORY REVIEW. THAT SAID, THE FIRST THREE ITEMS BE IDENTIFIED -- WE IDENTIFIED HAVE BEEN ACCOMPLISHED. AND WE ARE GOING TO CONTINUE TRACKING THEM. IF WE AUDIT SOMETHING LIKE THIS IN THE FUTURE, WE WANT TO LOOK AT WHAT PROGRESS HAS BEEN MADE. THEY HAVE BEEN ENTERED INTO OUR TRACKER. THE FIRST THREE LIKE I SAID ARE CLOSED. THE FOURTH, WHICH WE WOULD SAY HE IS STILL OPEN, AND I THINK SHOULD STILL GET SOME ATTENTION, WAS AN ITEM THAT WAS MORE FOR THE CITY COUNCIL'S CONSIDERATION.
THIS WAS THE ITEM RELATED TO CITY COUNCIL AIDES WHO WERE ON SITE ON JUNE 3. THE RHETORICAL QUESTION FROM THE OFFICE OF CITY AUDITOR WAS, SHOULD THERE BE SOMETHING WRITTEN INTO THE ETHICS POLICY ABOUT THE COUNCIL'S ACTIVITY? COUNCIL AIDES, LIKE MANY INDIVIDUALS IN THE CITY, ARE APPOINTED, BUT THEY ARE IN A UNIQUE POSITION IN THE SENSE THAT THEY REPORT TO THEIR COUNCIL MEMBER THAT APPOINTS THEM EVEN THOUGH ADMINISTRATIVELY THERE ARE WITHIN THE LEGISLATIVE DEPARTMENT.
THE IDEA HERE IS THE COUNCIL SHOULD CREATE SOME SORT OF POLICY ON WHAT IS APPROPRIATE BEHAVIOR OF COUNCIL AIDES. I WOULD TAKE THAT ASIDE FROM ICE ACTIVITY. THAT IS SOMETHING, AS EMPLOYEES, THERE SHOULD BE DIRECTION ON WHAT IS APPROPRIATE BEHAVIOR AS EMPLOYEES, ESPECIALLY CONSIDERING THE STRANGE ALIGNMENT OF POSITIONS. 2025 ALSO HAD AN AUDIT OF THE MINNEAPOLIS PARKS BOARD. THIS WAS RELATED TO PAYMENT OVERSIGHTS. THESE ARE NOT YET PAST DUE. WE HAVE THOROUGH UPDATES STARTING ON PAGE 23 ON THESE. MP
RB WAS HOPEFUL IN PROVIDING STATUS UPDATES. THEY DID A JUST A FEW OF THEIR TIMELINES FROM JUNE 30 OF THIS YEAR TO DECEMBER 31 OF THIS YEAR. THEY HAD GOOD REASON TO DO SO. THEY HAVE MADE PROGRESS IN SOME AREAS. I AM NOT GOING TO GO INTO THE DETAILS ON ALL OF THESE, BUT AS FAR AS TRAINING STAFF HAVING CONVERSATIONS WITH SITE MANAGERS ABOUT ISSUES THAT WE BROUGHT UP, THEY HAVE COMPLETED THOSE ACTIVITIES. THEY WANT TO DO MORE IN BUILDING ON THEIR FORMAL POLICIES AND PROCEDURES. SO I DO SUGGEST THAT, AFTER THESE COME DUE DECEMBER 31, THAT ANYTHING THAT REMAINS OPEN, OR EVEN IF THEY ARE ALL
CLOSED, WE CAN INVITE THEM IN FEBRUARY 2027 TO SPEAK TO THE AUDIT COMMITTEE ABOUT PROGRESS OR ANYTHING THAT IS UNRESOLVED. THE NEXT ONE IN 2020 FIVE WAS OVERSIGHT OF AN URGENT SINGLE SOURCE CONTRACT. THIS WAS THE HELIX HEALTH, HOUSING SERVICES CONTRACT. IF YOU REMEMBER, THIS ONE HAD SOME QUESTIONS ABOUT PERCEIVED CONFLICTS OF INTEREST FROM DIRECTION FROM THE MAYOR'S OFFICE REQUESTING THIS PARTICULAR VENDOR FOR THESE SERVICES. IT DID NOT GO THROUGH THE NORMAL CONTRACTING PROCESS. AT THE TIME, WE HAD RECOMMENDATIONS GENERALLY
AROUND DEVELOPMENT POLICY TO HELP ALLEVIATE CONFLICT OF INTEREST, TO STRENGTHEN DEPARTMENT HEADS AND CONTRACT MANAGERS' ABILITY TO PUSH BACK ON ELECTED OFFICIALS DEMANDING A CERTAIN VENDOR BE UTILIZED, DEMANDING THAT A CONTRACT GO AROUND THE ESTABLISHED PROCESS. SO THIS WAS, AGAIN, AN ISSUE WITH CONTRACT OVERSIGHT MANAGEMENT. I THINK THAT THIS IS ONE THAT I BELIEVE WE HAVE SAID THAT THERE IS -- ON FINDING FIVE ON PAGE 30, THIS IS ONE
WHERE THERE HAS NOT BEEN SUFFICIENT PROGRESS ON. WE SUGGEST THEY COME IN FRONT OF THE AUDIT COMMITTEE IN OCTOBER TO EXPLAIN THAT. THE OTHER ITEMS, HOWEVER, THEY HAVE PROVIDED SIGNIFICANT DETAIL, PROGRESS. THE FINANCE DEPARTMENT HAS UPDATED PROCUREMENT POLICIES, CREATED SOME TRAININGS. THEY ARE DOING MORE IN PROACTIVELY LOOKING FOR UNALLOWABLE EXPENSES. THAT SAID, ALTHOUGH THEY HAD PROVIDED ENOUGH EVIDENCE FOR US TO FEEL COMFORTABLE THAT THEY ORIGINALLY IDENTIFIED RISK AS MITIGATED, BECAUSE WE ARE ASKING THEM TO COME IN FRONT OF THE AUDIT COMMITTEE IN OCTOBER, I THINK WE SHOULD ASK THEM
ABOUT ALL OF THESE. I THINK WE CONTINUE TO SEE ISSUES WITH CONTRACT MANAGEMENT PROCUREMENT AND OVERSIGHT. LET'S KEEP THAT ON THE RADAR. GETTING INTO PAGE 31, WE ARE NOW INTO 2026, SIMILAR TO MPRB, NONE OF THESE ARE PAST DUE YET. 2026 IS THE SHOOTING OF -- WE ALSO HAD SOME COMMENTARY ON THE WORKFORCE OPTIMIZATION REPORT STARTING ON PAGE 31 IN THE REPORT. NONE OF THE AFTER ACTION REVIEW ITEMS ARE PAST DUE YET. THREE OF THEM WE WERE ABLE TO IDENTIFY
AS POLICIES THAT HAVE ALREADY BEEN UPDATED. THEY PROVIDE THE NEW POLICY TO US. THOSE WERE QUICK HITS. THE POLICE DEPARTMENT DID SUBMIT SOME DOCUMENTATION FOR THREE MORE THAT WE BELIEVE WILL BE ABLE TO CLOSE BUT WE NEED TO VERIFY THAT INFORMATION BASED ON WHAT WE HAVE RECENTLY RECEIVED. I BELIEVE OF THE 37 ORIGINAL FINDINGS, WE ARE AT 31 THAT ARE GOING TO NEED THEIR RESPONSIVENESS. WHEN WE WORKED WITH THEM IN PREPARATION FOR THIS PROJECT, WE ASKED THEM IF THEY BELIEVE THE TARGET DATES ORIGINALLY
ESTABLISHED BY THE FORMER CHIEF OF POLICE WERE REASONABLE. THEY TOOK TIME TO REASSESS THEM. THEY DID IT ESTABLISH TARGET DATES ON THE ONE THAT HAD NOT HAD TARGET DATES ESTABLISHED. THEY DID MAINTAIN SOME TARGET DATES OF NOVEMBER OF THIS YEAR, REQUESTED A FEW TO BE MOVED TO JANUARY, I BELIEVE OF NEXT YEAR. WHERE WE ARE WITH MONITORING ON THIS PARTICULAR PROJECT, WE ARE IN A GOOD PLACE. THIS WILL BE A TOPIC OF CONVERSATION WHEN WE MEET IN THE MPD CHIEF OF STAFF LATER THIS WEEK.
BUT WE CONTINUE MONITORING EACH OF THESE FINDINGS FOR RESOLUTION. AS I MENTIONED, WE WILL HAVE ACCESS TO THE SYSTEM TO DO THAT YOURSELF, WHICH IS PRETTY COOL. THE WORKFORCE OPTIMIZATION REPORT AND WE DID NOT INCLUDE IN THE PROJECT TRACKER. I KNOW THERE WAS A QUESTION ABOUT THAT IN APRIL, ON HOW THOSE RECOMMENDATIONS ARE GOING TO BE MONITORED. . THOSE WERE MORE SOFT RECOMMENDATIONS IN A SENSE OF THEY WERE FOR THE ADMINISTRATION AND THE COUNCIL TO CONSIDER WHILE THEY ARE CONSIDERING BUDGET FOR 2027, WHICH THEY ARE ACTIVELY DOING RIGHT NOW. I CAN SAY A NUMBER OF THE RECOMMENDATIONS -- I THINK
THERE WERE 11 TOTAL -- BUT A NUMBER OF THEM ARE UNDER CONSIDERATION. AS WE ARE FAMILIAR WITH THE BUDGET IMPLICATIONS IN THE CITY, I THINK EVERYTHING IS UNDER CONSIDERATION RIGHT NOW. WE WILL CONTINUE TO KEEP AN EYE ON THAT REPORT BACK TO THE AUDIT COMMITTEE, IF THROUGH THE BUDGET PROCESS, ANY OF THOSE RECOMMENDATIONS HAVE BEEN COMPLETED. IF YOU ARE LOOKING AT THE SCREEN, THOSE HAVE ALREADY BEEN CLOSED. IN FACT, I THINK THEY WERE JUST TWO SOFT RECOMMENDATIONS, LOW RISK, AS WELL. NORMALLY WOULD BE TRACKED. IF YOU LOOK AT THE SLIDE IN THE HANDOUT, YOU CAN SEE WHICH
SPECIFIC RECOMMENDATIONS HAVE EITHER BEEN CLOSED OR THAT VERIFICATION IS IN PROGRESS. AS I MENTIONED, WE WILL TALK A LITTLE BIT OF A RISK CATEGORIES. WITH AUDIT, WE TYPICALLY WILL HAVE A LOW, MODERATE, HIGH RISK. TRADITIONALLY YOU HAVE SEEN A LOT OF HIGH RISK THROWN AT YOU, AND THAT'S FINE. BUT IT KIND OF GETS LOST IF THERE IS NOT A DIFFERENTIATION BETWEEN THEM. AS I MENTIONED, WE HAVE UPDATED RISK EVALUATION BEFORE. PAST AUDIT FINDINGS WOULD BE MORE CONSIDERATE OF IMPACT AND LIKELIHOOD. WHEN YOU THINK
ABOUT INTERNAL CONTROL STANDARDS, THOSE ARE THE TWO THINGS THAT REALLY HELP IDENTIFY RISK AND CATEGORIES RISK. ON THE NEXT SLIDE, WE HAVE A TABLE. THIS IS WHAT WE ARE GOING TO CONSIDER IN CATEGORIZING RISK. IS IT GOING TO POSE A SIGNIFICANT REPUTATIONAL HARM TO THE DEPARTMENT? OF COURSE, THIS IS A JUDGMENT CALL IN THIS AREA. EVERYTHING COULD POSE A SIGNIFICANT REPUTATIONAL HARM. IS IT A MAJOR SAFETY RISK? IN THIS CASE, COULD IT CAUSE SIGNIFICANT BODILY INJURY OR DEATH? IS IT SOMETHING THAT WE HAVE BROUGHT UP MULTIPLE TIMES? THIS IS WHERE I SEE IF WE EVALUATE SOMETHING AS MODERATE, IF WE THEN EVALUATE AND SEE IT HAS NOW ESCALATED TO A HIGHER
CLASSIFICATION. ALSO, ARE THERE LINKS TO AREAS THAT MIGHT CAUSE HARM? THAT COULD BE SOMETHING LIKE MAY BE THE SHOTSPOTTER SYSTEM, WHICH YOU'LL SEE A REPORT ON IN AUGUST. THE SYSTEM ITSELF IS TECHNOLOGY, BUT DOESN'T HAVE A LINK TO SOMETHING THAT IS MAYBE SAFETY-RELATED? THAT IS WHAT WE ARE TALKING ABOUT THEIR. THAT IS THE MATRIX WE HAVE DEVELOPED. THIS IS PRETTY STANDARD IN THE AUDIT WORLD. ON THE USE OF SLIDES, YOU WILL SEE THE ONES THAT WE HAVE PRODUCED HIGH TO MODERATE. THE LAST THING I WANT TO SAY, YOU WILL NOT SEE MUCH ON LOW.
THE REASON IS WE SAVED THOSE FOR THE VERBAL AUDIT FINDINGS. WE WANT TO MAKE SURE THAT WE ARE SHARING WITH AUDITEES THINGS THAT WE SEE THAT THEY COULD WORK ON, MAYBE A BEST PRACTICE, SOMETHING THAT DOESN'T HAVE ACTUAL LEGAL OR REGULATORY CRITERIA TIED TO IT. OR MAYBE IT IS JUST SOMETHING THAT BASED ON OUR PROFESSIONAL JUDGMENT, WE THINK THEY SHOULD CHANGE SOMETHING. THEY DON'T HAVE TO. IT IS NOT SOMETHING THAT RISES TO THE LEVEL OF A MODERATE OR HIGH RISK. SO WE HAVE MAINTAINED THAT AS A VERBAL FINDING. WHAT WE WILL BRING TO THE AUDIT COMMITTEE WILL TYPICALLY BE MODERATE AND HIGH RISK FINDINGS. AS I MENTIONED, FOR OCTOBER, AND IF WE NEED TO, PARKS BOARD FOR FEBRUARY, IF THIS IS
THE DESIRE OF THE AUDIT COMMITTEE, I WILL WORK WITH THE CHAIR TO DRAFT FORMAL LETTERS AND THE VOICE OF THE AUDIT COMMITTEE GOING TO EACH OF THE AUDITEES, DEPARTMENT, EXECUTIVE LEADERSHIP, AND WILL BE ASKING FOR THEM TO ADDRESS THESE ITEMS. MOST OF THESE ARE THE SAME ITEMS IN THE NEW TRACKING DATABASE THAT WE ARE LOOKING FOR UPDATES ON. SINCE WE HAVE SEEN PROGRESS IN SOME OF THESE AREAS, ARE WE HAVE NOT GOTTEN AN UPDATED TARGET DATE, WE THINK IT'S IMPORTANT THAT THEY SPEAK TO THE AUDIT COMMITTEE VERBALLY ABOUT THE EFFORTS THEY HAVE TAKEN TO
MITIGATE THE RISK. IF IT IS RELATED TO BUDGET, WHAT HAVE THEY DONE TO SEEK FULL FUNDING? WHETHER THAT IS SPEAKING WITH FINANCE, SPEAKING TO EXECUTIVE LEADERSHIP, TALKING TO THE CITY COUNCIL BUDGET COMMITTEE. IF IT IS RELATED TO OTHER DEPARTMENTS, DESCRIBING COORDINATION EFFORTS THAT HAVE BEEN TAKEN TO DATE, IF IT IS RELATED TO POLICIES AND PROCEDURES, SHARING UPDATES ON AND DRAFTS ON WORK IN PROGRESS, IF IT IS RELATED TO TECHNOLOGY, ANY ROADBLOCKS WE ARE HAVING. THOSE ARE THE CATEGORIES THAT JESSICA SPOKE TO EARLIER.
RESOURCES NEEDED. CAN THE CITY AUDITOR HELP, CAN YOU GET THEM IN CONNECTION WITH COUNCILMEMBERS MEMBERS ON THE BUDGET? WHAT CAN WE DO TO HELP, TOO? FRANKLY, WE POINT OUT THE RECOMMENDATIONS IN THE FINDINGS. WE WOULD BE MORE THAN HAPPY COME IN WHATEVER CAPACITY WE ARE ABLE TO, TO ALSO HELP MOVE THINGS FORWARD. I TALKED ABOUT ACCEPTING RISK. I GOT INTO IT. MAYBE I SHOULD'VE HAD THIS SLIGHT EARLIER BECAUSE I SAW YOUR FACIAL REACTIONS. THE REALITY IS, IF THE CITY IS GOING TO ACCEPT ANY RISK, IT SHOULD ONLY BE DONE AT THE EXECUTIVE LEADERSHIP LEVEL.
MY ARGUMENT IS THAT, IF THE ADMINISTRATION WANTS TO ACCEPT THE RISK, FOR EXAMPLE, WE POINT OUT THAT A PARTICULAR POLICY NEEDS TO BE UPDATED, AND THEIR REACTION TO THAT IS THAT WILL CREATE TRICKLE EFFECTS THAT AFFECT SOMETHING ELSE. OK, THEN THAT IS A RISK YOU MIGHT BE WILLING TO ACCEPT. BUT WHO TELLS US THAT? IT SHOULD BE THE DEPARTMENT HEAD, SIGNED OFF BY A CITY DEPUTY OPERATIONS OFFICER, OR THE COMMISSIONER OF COMMUNITY SAFETY, AND IT MUST BE DOCUMENTED. I WOULD SAY DOCUMENTED, COME TO
TALK TO US, THAT IS IN THE PUBLIC RECORD. OR THERE IS A LETTER SENT TO THE AUDIT COMMITTEE. SOME LETTER SENT TO THE OFFICE OF CITY AUDITOR, EMAIL FROM ONE OF THEM SAYING, WE BECOME AS THE ADMINISTRATION, HAVE CHOSEN TO ACCEPT THIS RISK. IF I GET THAT, I WILL BRING THAT BACK TO YOUR AWARENESS. THAT IS THE LEVEL THAT RISK SHOULD BE ACCEPTED AT. WE ARE GETTING NEAR THE END OF MY SECTION. WE CANNOT LEAVE A PRESENTATION LIKE THIS WITHOUT CONTINUING TO PUSH FOR ENTERPRISE RISK MANAGEMENT WITHIN THE ADMINISTRATION. THE BEATING OF THE DRUM HAS BEEN THAT THE CITY
COUNCIL MAKE AN INVESTMENT, THE ADMINISTRATION FIND MONEY TO BRING ON AN EXECUTIVE LEVEL ENTERPRISE RISK MANAGEMENT OFFICER TO BUILD OUT A TEAM WHICH SUGGESTED TWO OR THREE PEOPLE TO START WITH. WE ARE ALSO AWARE THAT THE GROUP THAT WE COORDINATED WITH ON THE WORKFORCE OPTIMIZATION REPORT PROVIDE SOME ENTERPRISE RISK MANAGEMENT CONSULTING. AS I TOLD THE ADMINISTRATION, IT IS NOT A SALES PITCH, I'M NOT ADVOCATING FOR THEM, BUT I DO KNOW THEY HAVE A MEETING SET UP WITH THE COO IN THE NEAR FUTURE. I THINK THAT IS GOOD TO SEE. THE ADMINISTRATION IS REALLY TALKING ABOUT ENTERPRISE RISK
MANAGEMENT. WE HAVE INDIVIDUAL COUNCIL MEMBERS TALKING ABOUT FUNDING ENTERPRISE RISK MANAGEMENT, FINDING THAT IN THE BUDGET FOR 2027. AND THAT IS REALLY PROMISING. LIKE I SAID, WE CANNOT END A REPORT WITHOUT CONTINUING THAT CONVERSATION, CONTINUING THAT ARGUMENT. I WILL HAND BACK OVER TO NIKITA FOR ANOTHER QUICK FIVE MINUTES. ≫ THANK YOU, AUDITOR TIMMERMAN, THANK YOU FOR YOUR ATTENTION. WE WANTED TO IMPROVE THE AUDIT COMMITTEE PROCESS. WE WANTED TO IMPROVE THE AUDIT COMMITTEE PROCESS, THE CHARTER WAS UPDATED DECEMBER 8, 2025. AUDITOR TOURNAMENT WORKED WITH
THE -- TWO DEVELOPED COMPLEX FINDINGS WHEN DISRUPTION OCCURRED IN A REMEDIATION PROCESS. A CHARTER WAS UPDATED TO INCLUDE THE SCOPE AND RESPONSIBILITY SECTION WHICH LAID FOUNDATION FOR THE -- TO REQUEST AN AUDITEES ATTENDANCE AT THE NEXT SCHEDULED COMMITTEE MEETING WHICH AUDITOR TIMMERMAN JUST SPOKE ABOUT. WE ALSO REVIEWED CITY ORDINANCE AND NOTED THAT ORDINANCE 8. 140 ENHANCES THE AUDIT COMMITTEE'S OVERSIGHT CAPABILITIES BY PRESCRIBING A SET OF DUTIES WHICH INDICATES THAT THE AUDIT COMMITTEE SHALL REVIEW THE REPORTS DIRECTED TO
IT AND MAY MAKE RECOMMENDATIONS ON ANY SUCH AUDIT REPORTS TO THE CITY COUNCIL FOR CONSIDERATION ON THE APPROPRIATE COURSE OF ACTION FOR FINDINGS REQUIRING COUNCIL ACTION. THE MAYOR FOR CONSIDERATION OF THE APPROPRIATE COURSE OF ACTION FOR REPORTS CONCERNING CITY OPERATIONS. AND THE PARK AND RECREATION BOARD FOR CONSIDERATION ON THE APPROPRIATE COURSE OF ACTION FOR REPORTS CONCERNING PARK BOARD ACTIVITIES. FOLLOWING THE ACTION PRESCRIBED IN THE ORDINANCE, MOST ARE GOING TO RECEIVE AND FILE A PROCESS BY ENHANCING COMMITTEE ACTION TO FOLLOW UP WITH THE RELEVANT STAKEHOLDERS TO INITIATE ACTION ON MATTERS CONCERNING THE ORGANIZATION
WHEN WARRANTED. CHANGING THE CURRENT PROCESS FROM RECEIVE AND FILE TO RECEIVE, FILE, AND FOLLOW-UP. THIS MOVES US INTO ERM, HOW CRITICAL THIS FUNCTION IS TO THE VITALITY OF THE CITY. THE ADOPTION OF ENTERPRISE RISK MANAGEMENT PROGRAM WILL ENHANCE OUR ORGANIZATION'S ABILITY TO BREAK DOWN SILOS, HELP DRIVE FORWARD A FORMAL RISK-BASED FRAMEWORK CAPABLE OF BUILDING STRONGER CITY WORKFORCE. IT WILL COMMUNICATE RISK MORE CONSISTENTLY, AND IT WILL IMPROVE CITY FUNCTIONS SO THAT THEY ARE MORE ALIGNED WITH GOVERNMENT SOLUTIONS. IT'S ALSO IMPORTANT FOR THE ORGANIZATION TO DEMONSTRATE A COMMITMENT TO ENTERPRISE RISK MANAGEMENT SO
THAT OUR OFFICE CAN CONTINUE TO ABIDE BY OUR AUDITING STANDARDS. AUDIT IS THE LAST LINE OF DEFENSE AND THE OFFICE OF CITY AUDITOR MUST REMAIN SEPARATE FROM THE DAY-TO-DAY DUTIES OF MANAGING OPERATIONAL RISK. IN CLOSING, THANK YOU ALL. WE WANTED TO HIGHLIGHT THE EFFORTS OUR OFFICE HAS MADE SPANNING NEARLY SIX YEARS, TO HIGHLIGHT THE NEED FOR A FORMAL ENTERPRISE RISK MANAGEMENT PROGRAM FOR THE SECOND TIME THIS YEAR WE RECOMMEND THE CITY BUILD AN ENTERPRISE
RISK MANAGEMENT PROGRAM TO HELP FACILITATE RISK MITIGATION STRATEGIES, A DEDICATED RISK MANAGEMENT PROGRAM WILL ESTABLISH A STRONG RISK CULTURE THAT WILL HELP THE CITY IDENTIFY AND REPORT ISSUES EARLY, AND HELP REDUCE THE CITY'S FINANCIAL OR REPUTATIONAL HARM. THANK YOU. I WILL TURN IT BACK OVER TO AUDITOR TIMMERMAN FOR ANY QUESTIONS. ≫ THANK YOU IS VERY THOROUGH REPORT AND FOR ALL THE WORK THAT WE KNOW HAS GONE ON IN THE BACKGROUND TO MAKE EVERYTHING POSSIBLE THAT YOU HAVE JUST PRESENTED TO US. COMMITTEE MEMBERS, DO WE HAVE ANY QUESTIONS OR COMMENTS? COMMITTEE MEMBER HOSBEIN.
≫ THANK YOU, VICE CHAIR. I'M VERY EXCITED ABOUT THIS, WHICH IS OBVIOUS. THAT LAST SLIDE, SINCE I'VE BEEN ON THIS COMMITTEE, YOU HAVE BEEN THAT VOICE. I KNOW YOU SAID THAT AT THE TOP. THANK YOU FOR ALL THE CONTINUED PUSH FOR THIS HIGH-LEVEL UMBRELLA CHANGE THAT HAS BEEN NEEDED. I REALLY APPRECIATE YOUR WORK. I ALWAYS THINK THIS IS GETTING CLOSER, WE KNOW THIS IS HAPPENING. THANK YOU. PAGE SIX, ON THE CHART, THAT IS THE PROCESS I'VE BEEN TO KNOWING EXACTLY WHAT TO EXPECT. THANK YOU SO MUCH. I HAVE A COUPLE QUESTIONS ON THE TRACKER.
VERY EXCITED TO HAVE THAT OVERVIEW. SO MUCH EASIER TO FOLLOW. IN TERMS OF DATA ANALYTICS, ARE THERE OPTIONS -- I KNOW THERE ARE CLASSIFICATIONS AROUND STATUS. IS THERE ALSO CLASSIFICATIONS AROUND FINDINGS? IF I WANT HIM TO GO IN AND SAY, CAN YOU PULL ANY FUNDING THAT WAS PROCUREMENT RELATED OR POLICY RELATED, WOULD THAT BE A POSSIBILITY AND A DUDE AT THIS POINT SO WE CAN HAVE THAT OVERARCHING TRENDING? ≫ WE ARE GOING TO WRITE THAT DOWN. THE NEXT STEP WITH THE DATABASE IS BUILDING OUT THE REPORTING FUNCTIONALITY. A PART OF THAT IS IDENTIFYING WHAT WE NEED TO
MOVE FROM TEXT FIELDS INTO DROP-DOWN FIELDS WHERE WE CAN REALLY IDENTIFY THOSE THINGS. WE WILL GRAB THOSE TWO ITEMS, PROCUREMENT OR POLICY, AND WE WILL ADD MORE CATEGORIES. WE HAVE BUILT INTO, WILL BE BUILDING INTO OUR PROCESS. AT OUR NEXT AUDIT COMMITTEE MEETING, I'LL PROVIDE AN UPDATE ON ALL OF THE ADMINISTER OF WORK WE HAVE BEEN DOING IN THE OFFICE TO PREPARE FOR OUR PEER REVIEW FOR INVITING ASSOCIATION OF LOCAL GOVERNMENT AUDITORS TO COME IN AND REVIEW OUR WORK, TO ENSURE WE ARE MEETING PROFESSIONAL STANDARDS.
IN OCTOBER, I LIKE TO SHARE ALL THE WORK THAT WE'VE DONE IN PREPARATION FOR THAT. PART OF THAT IS BUILDING OUT OUR AUDIT MANUAL, BUILDING OUT OUR AUDIT PROCESS PROGRAM, UPDATING ALL OF OUR AUDIT TEMPLATES, REPORTS, THINGS OF THAT NATURE. A PART OF THAT IS BUILDING OUT HOW WE WILL MANAGE THIS SYSTEM WITH IN-HOUSE. A BIG PIECE OF THAT IS, BECAUSE THERE IS SOME AUTOMATION TO IT, SENDING OUT AUTOMATED EMAILS FOR AUDITEES TO RESPOND -- CANNOT REMEMBER WHAT WE PUT IN THE REPORT -- 4, 6, 12-WEEK MARK. IN ADDITION TO THAT, THERE WILL BE DIRECTOR
LEVEL MONITORING AND OVERSIGHT OF THE SYSTEM ITSELF. THE DIRECTORS WILL REGULARLY BE MONITORING THAT, FOLLOWING UP. THAT SHOULD REALLY HELP. I WOULD SAY THAT WE CAN BUILD IN THE REPORTING THE THINGS THAT WE THINK WE WANT TO SEE, BUT AS WE ARE WORKING THROUGH IT MONITORING, AS YOU ARE PLAYING IN IT, WE CAN CERTAINLY ADD THINGS, AS WELL. ≫ THAT WILL BE A HUGE IMPACT, ESPECIALLY IF THERE IS A MANAGEMENT PLAN UNDER A PROCUREMENT OR A TITLE THAT CAN BE EXPANDED MAY BE TO THE ORIGINAL AUDIT. ON THE CLOSED, JUST A SUGGESTION . I REALLY APPRECIATE SLIDES 30 AND 31,
WALKING US THROUGH WHAT CLOSED, WITH ACCEPTANCE OF RISK LOOKS LIKE. I WONDER IF THERE IS A CLOSED CLASSIFICATION OF THIS WAS CLOSED DUE TO IT BEING COMPLETE VERSUS THIS WAS CLOSED DUE TO A RISK ACCEPTANCE. IN MY MIND, DOES FEEL VERY DIFFERENT THINGS. THIS IS MORE LIKE THE REPORT ON THE OTHER SIDE DOWN THE ROAD, IF THAT'S A POSSIBILITY. ≫ WE ARE DISTINCTION BETWEEN CLOSED BECAUSE THEY HAVE MITIGATED THE RISK AND THE
COMMUNICATION PROCESS TO AUDITEES GOING FORWARD LIKELY TO START WITH AUDITS THAT THE REPORT IS COMPLETED IN OCTOBER. WE ARE GOING TO BUILD AS A PART OF OUR EXIT CONFERENCE WITH THE AUDITEE A DESCRIPTION OF THIS SYSTEM, OF WHAT THEY NEED TO DO, AND A PART OF THAT DIRECTION IS, IF YOU CLOSE SOMETHING BECAUSE YOU HAVE ACCEPTED THE RISK, YOU NEED A DEPARTMENT HEAD AND OTHERS TO SIGN OFF ON THIS. I THINK THAT IS CERTAINLY SOMETHING THAT WE WILL BE PUSHING FOR. YES, WE WILL TRACK THAT. ≫ THIS IS, OUTSIDE THE TRACKER MORE JUST THE RECOMMENDATIONS. PAGE EIGHT. THIS IS THE POLICE OFF-DUTY
WORK FINDING ONE THAT YOU ARE MOVING TO CLOSE. THIS IS BACK TO THAT WHAT ACCEPTING RISK MEANS. I AM NOT READING IN THE RESPONSE THAT THEY WOULD COME TO THE PODIUM AND SAY I AM ACCEPTING THIS RISK. I APPRECIATE THE CITY AUDITOR RESPONSE THAT THIS NEEDS TO BE CLOSED. I DON'T SEE THE DOCUMENTATION IN THEIR RESPONSE. THAT WOULD GO BACK TO WHAT YOU OUTLINED ON SLIDE 30, 32. IT WOULD BE NEEDED FOR THAT TO TALK ABOUT THAT BEING CLOSED. THAT TRUE DOCUMENTATION OF,
YES, WE ARE ACCEPTING THIS RISK. ≫ I THINK YOU ARE RIGHT. THAT IS AN EASY ENOUGH TO WEEK. WE HAVEN'T ACTUALLY CLOSED ANY OF THESE YET, SO WE CAN CERTAINLY LEAVE THAT ONE OPEN. AS A PART OF OUR INVITATION FOR THEM TO COME IN OCTOBER, WE CAN INCLUDE THAT. ≫ I ABSOLUTELY UNDERSTAND YOUR READING INTO THAT, THIS IS AN OBVIOUS ACCEPTANCE. BACK TO MY NOTES. THESE ARE REDACTED ITEMS, SO IT IS PAGE 12 AND 14. SEXUAL ASSAULT EXAMINATION KIT, BOTH FINDING ONE AND TWO.
ALSO THE EVIDENCE , PROPERTY AND EVIDENCE FINDING ONE. PEER AND NOT TO GO INTO THE DETAILS IN OPEN SESSION BUT MY EXPERIENCE BEING WITH THE INDIVIDUALS REPORTING TO THOSE, THEY CARE SO MUCH AND HAVE BEEN FIGHTING SO HARD. TO MAKE THESE CHANGES. I WOULD JUST ASK, WHEN THEY COME TO AUDIT COMMITTEE COMMITTEE NEEDS TO BE WHOEVER CAN ACTUALLY MAKE THE DECISION. THE PEOPLE IN THAT ROOM , THEIR LIVES ARE PROTECTING THIS EVIDENCE. THE FACT THAT WE ARE TALKING ABOUT $6 MILLION FOR AUDIT, WE CANNOT FIND THREE HUNDRED THOUSAND. I WANT TO KNOW WHO ANSWERS TO THAT.
THAT IS IN THE BULLETS THREE AND FOUR. CAN YOU SAY WHAT YOU HAVE SPOKEN TO, THE BRIGHT PERSON I NEED TO ANSWER TO THOSE QUESTIONS. ≫ ABSOLUTELY. I PUT NPD LEADERSHIP, SO THAT MEANS MANY THINGS. WE ARE ON THE SAME PAGE. ≫ THEY ARE JUST SO AMAZING BUT THEY ARE NOT THE ONES MAKING THIS DECISION. I THINK MY LAST ONE. THANK YOU. PAGE 18.
THIS IS THE FLEET MANAGEMENT FINDING. NUMBER ONE. THIS IS ABOUT DELAYS AND INVESTIGATION. I CAN WATCH THE VIDEO BACK OF THE COMMITTEE WHERE THEY CAME TO GIVE THEIR UPDATE. I BELIEVE DURING THAT UPDATE THAT WAS IN PERSON, THEY SAID ANY INCIDENT THAT INVOLVED A COMMUNITY MEMBERS PROPERTY VEHICLE PERSONS WAS PRIORITIZED, AND THOSE WERE NOT BEING DELAYED. I WOULD ARGUE THAT IF THAT IS NOT THE CASE I'M A THERE IS TO HARM HAPPENED TO THE
COMMITTEE, SO I WOULD ASK FOR THAT TO BE DOCUMENTED THAT YES, THEY HAVE GONE THROUGH AND THEY ARE NO LONGER DELAYING ANYTHING THAT WOULD BE INSURANCE, FINANCIAL, MEDICAL FOR ANYBODY, BECAUSE I WOULD CONSIDER THAT SO A HIGH RISK OR MODERATE IF THEY CANNOT SPEAK TO THAT. I DIDN'T SEE THAT IN THEIR UPDATE HERE. I GUESS I BELIEVE THEY SPOKE TO IT LIVE. I CANNOT HONESTLY REMEMBER. THAT WOULD BE A RECOMMENDATION FOR NOT MOVING IT TO MODERATE IF THERE ARE STILL DELAYS IN THE COMMUNITY GETTING RESOLUTION. ON DAMAGES. ≫ VERY GOOD.
WHEN WE GET THEM IN OCTOBER, WE WILL TRY TO IN OUR MEETING PROMPT THEM TO SEE IF WE CAN GET SOME EVIDENCE THAT THAT IS STILL THE CASE. I REMEMBER THAT AS WELL. IF IT IS, WE WILL MAINTAIN IT AS MODERATE. IF IT IS NOT, WE WILL MAINTAIN OR MOVE IT TO MODERATE. IF IT IS NOT, I AGREE, WE WILL SAY IT IS HIGH. ≫ I KNOW FROM THE RISK, I NEED TO PRINT THIS GRID OUT FOR MYSELF. I WOULD CONSIDER IT CAUSING FURTHER HARM US, SUITED TO THE COMMUNITY, FINANCIAL
SAFETY. IF SOMEONE IS WAITING ON AN INSURANCE CLAIM, THAT IS HARM. THANK YOU SO MUCH. THIS IS ALL REALLY EXCITING. ≫ GLAD THAT YOU LIKE IT BECAUSE WE LOVE IT. ≫ COMMITTEE MEMBER AL-MOWAFAK. ≫ THANK YOU. I JUST A SECOND WHAT MY COLLEAGUE MEMBER MENTIONED ABOUT THE TRACKING, WOULD ALSO LIKE TO SEE IN THE REPORTING COLLECTIVE ABILITIES WHEN THAT IS CREATED, WE CAN FILTER BASED ON THE RISK, PRIORITIZATION, ALSO THE AGING OF THE REPORTS. 180 DAYS, FOR EXAMPLE, 60 DAYS.
IN ADDITION TO THE VALIDATION, STATUS, WHICH IS THERE, BUT IF WE CAN FILTER THAT REPORTING ON THAT. ALSO MENTIONED BY MY COLLEAGUE, THE ROOT CAUSE ANALYSIS, THE ROOT CAUSE OF THIS EXAMPLE, FINDINGS. THE REPEATED FINDINGS. THAT IS VERY IMPORTANT TO SEE IF THIS IS THE FIRST TIME JUST TO BE ADDED, OR HAS BEEN MIXED, OR FOUND IT AGAIN. ALSO THE RESPONSIBLE LEADERSHIP, VISIBILITY. WHO IS RESPONSIBLE TO FOLLOW UP ON THESE FINDINGS? ANOTHER THING RELATED TO THE TRACKING, I'M NOT SURE IF THAT IS ALSO POSSIBLE. THERE IS A PLACE WHERE THE COMMITTEE CAN PUT SOME NOTES, ALSO SOME REQUESTS.
≫ I LIKE THAT IDEA. I BELIEVE THAT IS SOMETHING THAT WE CAN DO. LET'S EXPLORE THAT. ≫ THANK YOU. YOU ARE WELCOME. ≫ COMMITTEE MEMBERS, ANY OTHER QUESTIONS? I WILL ADD ONE REQUEST FOR THE STRUCTURED DATA FIELDS. THIS MAY HAVE BEEN TOUCHED ON. HAVING WON BY JUST APARTMENT I THINK WOULD BE A GREAT WAY TO SEE THE ENTIRETY OF WHAT IS ON THE PLATE OF ANY PARTICULAR DEPARTMENT, INCLUDING CROSS DEPARTMENTAL. OTHERWISE, I WILL ECHO OTHER COMMENTS THAT THIS WILL BE AN INCREDIBLE TOOL FOR OUR COMMITTEE MEMBERS AND THE
PUBLIC, INCREASING TRANSPARENCY AND ACCOUNTABILITY. I REALLY APPRECIATE ALL OF THE EFFORT OF THE ENTIRE AUDIT DEPARTMENT IN PUSHING THIS PROJECT FORWARD. IT WOULD BE A GREAT TOOL FOR ENTERPRISE RISK MANAGEMENT AS WELL. SEE NO FURTHER QUESTIONS OR COMMENTS, I WILL DIRECT THE CLERK TO FILE THIS REPORT. I WILL NOT DIRECT THE STAFF TO PUBLISH THE REPORT . MEMBERS, DO I HAVE A MOTION FOR THAT? ≫ SO MOVED. ≫ THE CLERK WILL NOW CALL THE ROLL. [ROLL CALL] THERE ARE FIVE AYES. ≫ THE MOTION CARRIES. THE FINAL ITEM IS THE REPORT OF THE CITY
AUDITOR. I WILL INVITE SADARTHA AND ROBERT TURMAN TO GIVE THE UPDATE. ≫ I WILL BE VERY BRIEF. I KNOW THAT YOU WANT TO GET BACK TO YOUR LIVES AND LUNCH. BECAUSE WE PROVIDED SUCH A LENGTHY REPORT , READING MATERIAL BETWEEN THE PRESENTATION AND THE REPORT THERE, WE ARE NOT GOING TO GO INTO THE LINK THAT WE TYPICALLY GO INTO IN OUR AUDITOR UPDATES. WE WILL TALK ABOUT THE COMPLETED IN PROGRESS WORK. NS D, MEET IN ANNAPOLIS REPORTS. IN PROGRESS WE HAVE THE TECHNOLOGY OR CAMERA,
SURVEILLANCE. IT IS KIND OF A BREAKOUT OF DIFFERENT TECHNOLOGY. THIS IS SOMEWHAT SIMILAR TO SHOTSPOTTER, SIMILAR TO THE ASK FROM THE CITY COUNCIL WAS FOR A REVIEW OF WHAT THE CITY CURRENTLY USES, BEST PRACTICES RECOMMENDATIONS. THIS IS AN ADVISORY REPORT THAT WILL COME OUT IN AUGUST. SHOTSPOTTER IS ONE I BELIEVE EVERYONE IS FAMILIAR WITH. THAT'S ANOTHER REPORT COMING OUT IN AUGUST. I KNOW THAT THE COUNCIL AND ADMINISTRATION ARE BOTH LOOKING FORWARD TO THAT ONE TO MAKE SOME DECISIONS ON FUNDING SHOTSPOTTER. WHAT THEY WILL GOING FORWARD. OTHER IN PROGRESS WORK. THIS DOES NOT INCLUDE ALL THE WORK IN PROGRESS BUT THESE ARE
KIND OF THE NEXT LARGER REPORTS THAT WILL BE TARGETED FOR OCTOBER. THE SOFTWARE INVENTORY AND ACCESS AUDIT WE HAVE BEEN TRYING TO DETERMINE 100% KNOWLEDGE AND UNDERSTANDING OF WHAT SOFTWARE OR VARIOUS SYSTEMS THAT THE CITY IS USING TO BUILD A DATABASE FOR THAT OR TRACKING MECHANISM FOR THAT BECAUSE WE WILL THEN USE THAT TO BUILD OUT OUR SELECTION FOR FURTHER AUDITS. ACCESS, SECURITY, THINGS OF THAT NATURE. THEN THE OTHER IS THE BCR CONTRACT AUDIT. THIS IS LOOKING SPECIFICALLY AT THE
FIRE DEPARTMENT MONITORING, CONTRACTING WITH OUR BCR VENDOR. WITH THIS PARTICULAR ONE, WE HAVE BEEN INTO THE FIELD WORK STAGES. WE ARE WORKING ON SCHEDULING SOME PHYSICAL OBSERVATION RIGHT ALARMS AND THINGS OF THAT NATURE. THAT WILL BE PICKING UP QUICKLY. FRAUD, WASTE, ABUSE INVESTIGATIONS, WE HAVE THREE THAT ARE OPEN AND UNDER REVIEW. JUST A COUPLE ADMINISTERED OF UPDATES. WELCOME TO OUR NEW AUDIT COMMITTEE MEMBERS. SO GLAD THAT YOU COULD JOIN US.
THAT BEING SAID, I'D ALSO LIKE TO RECOGNIZE HAYLEY WILLIAMS WHO HAD HIS LAST MEETING ON APRIL 22. SHE STEPPED UP FOR A FEW MONTHS BEYOND THE END OF HIS TERM, SO I APPRECIATE HIS PARTNERSHIP AND COOPERATION ON THE AUDIT COMMITTEE OVER THE YEARS. PERSONNEL UPDATES, I WASN'T ABLE TO SHARE AT OUR LAST MEETING BUT MATT KAYE WATER HAS BEEN PROMOTED TO OUR DIRECTOR OF WE HAVE CREATED AN AUDITOR THREE WHICH IS AN AUDITOR PRINCIPAL POSITION WHICH WILL ACT AS A WORKER WITHIN THE
OFFICE THAT HUMAN RESOURCES AND OFFICE OF CITY AUDITOR ARE WORKING ON GETTING THAT ALL WRAPPED UP NOW. I MENTIONED THIS AT EACH OF THE LAST TWO MEETINGS. I THINK I MESSAGED IT AS WELL. WE HAVE BEEN ADVISED BY THE CLERK'S OFFICE WHO WAS ADVISED BY THE ATTORNEY'S OFFICE WE SHOULD REALLY BE CAREFUL TO SEND INFORMATION TO MINNEAPOLIS EMAIL ADDRESSES SO YOU GET SET UP WITH ONE IF YOU HAVEN'T ALREADY. IF YOU EVER HAVE ISSUES, CONCERNS OF ACCESS,, WE CAN HELP WORK WITH THE CLERK. FANTASTIC TROUBLESHOOTER WHEN
IT COMES TO THAT. THE VERY LAST ITEM . THE COUNCIL PRESIDENT PAINE HAD WRITTEN A LETTER TO THE AUDIT COMMITTEE AND SHOULD I SAY COMMITTEE CHAIR PAINE. FIRST AND FOREMOST HE REALLY WANTED TO BE HERE TODAY. HE EXPRESSED A REAL DESIRE TO BE HERE TO HEAR THESE REPORTS TODAY BUT COULDN'T BE HERE. HE WANTED TO SHARE WITH YOU THOUGHTS HE HAD AS WE WERE TALKING ABOUT THE NSD AUDIT AND THE FACT THAT SOME OF THAT WAS MORE OF A CULTURAL ASSESSMENT OF WHAT WAS GOING ON.
WE LOOKED AT THE REGULATORY CRITERIA AS WE ARE ABLE TO BUT WE ALSO MADE AN ASSESSMENT BASED ON AN OBSERVATION. HE WANTED TO HAVE THE AUDIT COMMITTEE CONSIDERED FORKING -- INCLUSION IN THE 2027 WORK PLAN THAT THE CITY AUDITOR DO MORE OF THAT DEPARTMENT LEVEL, DEPARTMENT HEAD LEVEL OF WHAT IS HAPPENING CULTURALLY WITH THE INDIVIDUAL OFFICE. I'M OPEN TO THAT, KEEPING IN MIND THERE ARE 25 OR MORE DEPARTMENTS IN HIS
LETTER TO READ ACTUALLY I DON'T REMEMBER IF IT IS IN THE LETTER OR THE CONVERSATION HE HAD SUGGESTED LOOKING AT DEPARTMENTS EVERY THREE YEARS. THAT WOULD BE A BIG UNDERTAKING BUT I DO THINK WE CAN COME UP WITH A PLAN WHERE WE HAVE SOME SORT OF CONTINUOUS PROCESS TO DO THIS. MAYBE WE PRIORITIZE BASED ON RISK IF IT IS A DEPARTMENT THAT HAS A NEW DEPARTMENT HEAD, A HIGHER ELEVATED RISK. NOT NECESSARILY RISK, JUST A GOOD TIME TO DO IT. I LIKE THIS. I THINK WE JUST NEED TO THINK ABOUT HOW CAN WE MAKE THIS
HAPPEN GIVEN RESOURCES WITHIN THE OFFICE. I WILL BE QUIET FOR A MOMENT TO SEE IF YOU GUYS HAVE ANY DISCUSSION ON THIS. OTHERWISE I WILL SAVE THIS AND WE WILL INCORPORATED INTO CONVERSATION ABOUT OUR 2027 AUDIT PLAN. ≫ THANK YOU, AUDITOR TIMMERMAN. ANY QUESTIONS, COMMENTS ON WHAT WAS PRESENTED AND/OR ON THE LETTER FROM CHAIR PAINE? ≫ IS THIS SOMETHING THAT WOULD REQUIRE ACTION FROM THE AUDIT COMMITTEE ITSELF TO MOVE FORWARD? OR JUST MORE OF A DISCUSSION? ≫ IT DOES NOT REQUIRE ACTION. THE FANCY DANCE WE PLAY IS THAT THE AUDIT COMMITTEE LIKE THE CITY COUNCIL CANNOT DIRECT
THEM TO CONDUCT AN AUDIT, THAT INDEPENDENCE. THAT SAID IF YOU WANT US TO DO SOMETHING, WE ARE LIKELY GOING TO DO IT. I LIKE THIS IDEA. IT IS WORTH BUILDING INTO A PLAN. NO FORMAL ACTION IS NEEDED. WE JUST CONTINUE THE CONVERSATION. ≫ FOR THE RECORD, I LIKE IT AND I'M SUPPORTIVE. I UNDERSTAND THE ADDITIONAL WORK AND JUST RECENTLY GETTING STAFFED UP WITH NEW HIRES. IT WOULD BE GOOD SO THANK YOU. ≫ COMMITTEE MEMBER? ≫ I WOULD LIKE TO ASK IF YOU HAVE SUFFICIENT RESOURCES TO INFORM THIS AND IF YOU NEED ADDITIONAL RESOURCES HOW MUCH?
≫ CHAIR SINGLETON AND AUDIT COMMITTEE, CERTAINLY -- CURRENTLY WE BUILT THIS OFFICE OVER THE LAST 12 MONTHS TO BE AT 14 FTE'S. I FEEL THAT IF WE START GETTING MPD OVERSIGHT WORK THAT IS A TRICKLE DOWN FROM THE AGREEMENT OR FRAMEWORK THAT WILL REQUIRE MORE RESOURCES. IF WE TOOK THIS ON IN THE FREQUENCY SUGGESTED WE WOULD NEED MORE RESOURCES. I HAVE FOR FISCAL YEAR 2027 REQUESTED FOR ONE MORE FTE. LAST YEAR WE REQUESTED TO BUILD THE OFFICE TO 15 WHICH WOULD INCLUDE A DEPUTY CITY AUDITOR. WE DID NOT GET FUNDING BUT WERE
ABLE TO SECURE IT FOR SIX POSITIONS AFTER HAVING LOST MANY POSITIONS TO THE CITY CLERK'S OFFICE. SO WE DO HAVE ONE POSITION IN THE WORKS. HOPEFULLY THERE WILL BE FUNDING FOR THAT. BUDGET IS GRAY RIGHT NOW. I WOULD SAY IN THE MIDTERM OR THREE TO FIVE YEAR OUTLOOK I WOULD SAY THAT IF WE GET SOME OF THE OVERSIGHT WORK IF WE TAKE THIS ON, I WOULD LIKE IT TO BE AT ABOUT 20 POSITION SO YES, LET'S TALK RESOURCING FOR THIS ALONE. WE COULD BUILD THIS INTO OUR
PLAN TO DO ONE OR TWO OF THESE IN 2027 SO WE CERTAINLY CAN SCRATCH THE SURFACE. ≫ THANK YOU. ≫ VICE CHAIR, THANK YOU. ABSOLUTELY WE HAVE THE RESOURCES AND THIS IS SOMETHING THAT NEEDS TO COME INTO THE LARGER BUDGET CONVERSATIONS. FOR ME, OBJECTIVITY AND ACCOUNTABILITY FRAMEWORK I SUPPORT THE IDEA. I THINK IT NEEDS TO BE VERY CLEAR OF ONE AND HOW A DEPARTMENT GETS RAISED BECAUSE
I DON'T WANT THERE TO BE POTENTIAL INFLUENCE OF WHO IS RAISING IT TO THE TOP AND SOMETHING LIKE, YES A NEW DEPARTMENT HEAD MAKES A LOT OF SENSE. A NEW REPORT WOULD BE GOOD TO USE FOR SOME OF THAT BUT I WOULD BE INTERESTED IN SEEING WHAT THAT, CHART LOOKS LIKE OF SAY YOU CAN DO THREE DEPARTMENTS A YEAR. I DON'T KNOW IF THAT IS REASONABLE, BUT WHICH THREE DEPARTMENTS WOULD REACH THE LEVEL OF PRIORITY. I WOULD SAY YES, VERY MUCH IN SUPPORT, BUT HOW DOES THAT IN ACTION WORK IN A VERY OBJECTIVE
WAY. I WOULD SAY ALL DEPARTMENTS, ALL GROUPS, NEED TO BE COVERED. IT IS NOT JUST CERTAIN GROUPS. ≫ I THINK I AGREE ALSO THAT THIS COULD BE A USEFUL MECHANISM. THE OTHER THING I'M THINKING ABOUT, WHAT OTHER SYSTEMS ARE ALREADY IN PLACE OR SHOULD BE IN PLACE WITHIN THE CITY ENTERPRISE TO CAPTURE SOME OF THIS INFORMATION THAT COULD BE LEVERAGED BOTH TO HAVE SOME OF THAT POST MONITORING AND ALSO COULD BE USED TO HAVE THE MORE OBJECTIVE WAY TO DETERMINE WHICH DEPARTMENTS SHOULD BE INCLUDED. I THINK IT DOES GET FUZZY IN TERMS OF, HOW DO YOU DISTINGUISH THINGS THAT SHOULD BE MANAGED
UP THROUGH THE CHAIN OF COMMAND WITHIN THE CITY AND HOW DO YOU THEN OVERLAY THE POTENTIAL AUDIT FOR THAT. IT WOULD BE HELPFUL TO KNOW WHAT ALREADY EXISTS IN TERMS OF CITYWIDE PERFORMANCE MANAGEMENT BOTH OF INDIVIDUALS AND DEPARTMENTS. TO UNDERSTAND HOW THE APARTMENT CAN INTERPLAY WITH THAT. ≫ I AGREE. I KNOW THAT WASN'T A QUESTION, CHAIR, BUT I AGREE. I HAVE BEEN TALKING WITH THE TEAM A LOT ABOUT THAT. THE MORE THE TEAM CAN ENCOURAGE OVERSIGHT WITHIN THEIR MANAGEMENT FUNCTION, WITHIN THEIR GOVERNMENT'S FUNCTION,
THE GREATER ABILITY WE HAVE TO AUDIT THAT OVERSIGHT, THAT FUNCTION. THAT IS, IN AN ORGANIZATION MORE TRADITIONAL AND THEN WE WOULD SAMPLE INTO AREAS TO ENSURE THE WORK THEY HAVE DONE AND OVERSIGHT PROVIDED IS ACCURATE. I THINK WE'RE DEFINITELY TRYING TO MOVE IN THAT DIRECTION. ≫ GREAT, THANK YOU. ≫ ANY FINAL QUESTIONS, COMMENTS? ≫ ONE, AND I IMAGINE THIS IS HAPPENING ALREADY. THERE COULD BE A REQUIREMENT DEPARTMENTS MOVE INTO A SELF-ASSESSMENT MODEL THAT ALSO
HELPS FOLKS BE ABLE TO FILE THINGS THEY ARE CONSIDERING INTERNALLY FOR AUDIT CONSIDERATION AND MAY BE IS HAPPENING THROUGH OTHER PERFORMANCE. MAY THE TIME IS SPENT DOING THE EIGHT CATEGORIES YOU AS AUDIT WOULD LOOK AT, DO AN ASSESSMENT. COULD BE A WAY TO MITIGATE THAT. I HAVE SEEN IT WORK SUCCESSFULLY IF DONE RIGHT AS A PROACTIVE TOOL VERSUS A PUNITIVE TOOL. ON THAT IDEA OF OTHER RESOURCES, MANAGE SELF-ASSESSMENT VERSUS BE THE ONE DOING THE WORK. ≫ THANK YOU. ≫ THANK YOU. ANY OTHER QUESTIONS, COMMENTS? GREAT.
WITH OF THAT, THANK YOU FOR YOUR PRESENTATION. I WILL ASK THE CLERK TO FILE THE REPORT. SEEING NO FURTHER BUSINESS BEFORE US AND WITHOUT OBJECTION, I WILL DECLARE THIS MEETING ADJOURNED. THANK YOU, EVERYONE.