After months of recruiting, Palo Alto is preparing to pull the trigger on hiring a new city auditor, with the City Council picking the international firm Baker Tilly to fulfill a function that has historically been overseen by a City Hall employee.
The city announced on Wednesday that it is preparing to approve a contract with Baker Tilly for 21 months (or one year and nine months), with an option to renew for three additional years. Under the new agreement, the city would pay the firm up to $750,000 per year, with the first year pro-rated at $550,000.
Kyle O'Rourke, senior consulting manager at Baker Tilly, would function as Palo Alto's city auditor once the council votes to finalize the deal on Sept. 28.
The hiring of Baker Tilly represents a major shift for Palo Alto's city auditor role, which was created by city voters in 1983 and which hasn't had a permanent occupant since the last auditor, Harriet Richardson, left in February 2019. Earlier this year, the council responded to the recent history of staff conflicts and rapid leadership turnover in the office by voting to shift operations to an external firm.
In July, a council committee narrowed down its options for the new auditing firm to four finalists: Eide Bailly LLC, Moss Adams LLP, Sjoberg Evashenk Consultants and Baker Tilly. With a workforce of 3,350 employees, the Chicago-based Baker Tilly was the largest of the contenders. Baker Tilly’s California office locations include Los Angeles, Orange County, San Diego, San Francisco and San Diego.
In its announcement, the city touted Baker Tilly's experience in the public sector with clients such as the cities of Carlsbad, Riverside, Burbank, Modesto and Richmond. It has also worked with municipal utilities such as Sacramento Municipal Utility District, San Diego Gas & Electric and the California Public Utilities Commission.
Mayor Adrian Fine said in a statement that the council sees "tremendous community value" in selecting firm, which is part of the Baker Tilly International network, to perform the city's audit function, which he said provides "vital risk monitoring transparency and accountability for the Palo Alto community."
"Kyle O'Rourke's experience and leadership managing public sector audit consulting for Baker Tilly will serve our community well as we focus on ensuring annual audits, risk management reviews, and other important work," Fine said.
O'Rourke, who has 10 years of experience in internal auditing and consulting in the public sector, is a certified internal auditor and a certified government auditing professional, according to the announcement. He also serves as senior vice president of the Chicago chapter of the Institute of Internal Auditors.
O'Rourke said in the statement that he is honored to be selected as Palo Alto's next city auditor and that he recognizes the "unique opportunity for our firm and myself to play this important role."
"Our team brings together extensive public sector and internal audit experience and we will work diligently to achieve the mission the City Council has set for Palo Alto's City Auditor focus, keeping residents' best interests at the forefront."
The proposed contract gives the council the option of terminating the agreement within 10 days. If the council votes to approve the contract, Baker Tilly will begin its new role in Palo Alto on Oct. 1, according to the announcement.