With City Auditor Harriet Richardson concluding her Palo Alto tenure this month, city officials are preparing to hire a consultant to manage the office while the City Council considers its long-term future this Monday.
The small but busy office has been wracked with controversy over the past year, hampered by in-fighting between Richardson and several members of her staff and by uncertainty over its future. Last May, the council's Finance Committee briefly flirted with outsourcing its services entirely, a proposal that it ultimately scuttled after criticism from former city auditors and several members of the council and members of the community.
At one point, staff from the auditor's office had even considered taking legal action against the city, though they ultimately chose not to once the council decided to retain the positions.
Despite the internal discord, the auditor's office has been on the frontlines in recent years in identifying problems and recommending solutions to key municipal programs, including Palo Alto's increasingly costly animal services operation (which was just outsourced to the nonprofit Pets In Need), its buggy business registry system and its inconsistent code-enforcement program.
In approving its annual budget last summer, the council agreed to retain all five performance auditor positions (which former Councilman Greg Scharff had previously recommended eliminating). The Finance Committee also recommended by a 3-1 vote, with Lydia Kou dissenting, that the council should revisit the topic of the office's long-term future later in the year.
Kou stressed the importance of keeping a fully staffed Office of the City Auditor, which was created in 1983 by a city vote. The city auditor is one of four positions -- along with city manager, city attorney and city clerk -- that is appointed directly by the council.
Now, with Richardson's departure, the office is preparing for a transition period. A new report from the office of City Manager Ed Shikada recommends hiring the consulting company Management Partners to oversee the office's ongoing work on an interim basis. The agreement is expected to span between four to six months, with compensation coming from salary savings related to Richardson's departure. The Human Resources Department will also assign a manager to provide "ongoing personnel supervision" to the auditor's office, according to the report.
At the same time, the city is preparing to put out a request for proposals for another consultant who will help the council consider broader long-term changes for the office. The consultant would help compare Palo Alto's city auditor function with those of other government agencies and consider whether some of the office's responsibilities should be shifted from the auditor's office to that of the city manager (whose programs are routinely overseen by the auditor).
The report from Shikada's office notes that the resources needed to staff the city auditor's office "could be provided in a variety of manners, ranging from entirely in-house staffing to project-specific consultant engagement, or a combination of resources."
"Given the City Council's ongoing review of the city's strategy for fiscal stability, including the costs and funding necessary for city-employee pensions, this is an appropriate time to review organizational options for resourcing the city's audit function."