Memo to city departments about audits stirs concern

Deputy mayor announces policy to `aggressively counter' negative findings

August 11, 2004|By Doug Donovan | Doug Donovan,SUN STAFF

On the same day last week that Baltimore's auditor released a critical review of some city operations, First Deputy Mayor Michael R. Enright announced in an e-mail a new policy to "aggressively counter negative audit findings" before they are made public.

City officials said the new policy aims to improve cooperation with Comptroller Joan M. Pratt's auditors in order to fix problems found in audits more quickly, or to explain them better.

But Pratt and City Council President Sheila Dixon, the only citywide elected officials other than the mayor, said they feared the new policy could interfere with auditors' independence. And political observers said Enright's memo sounded as if the administration of Mayor Martin O'Malley is more interested in positive spin than in eliminating inefficiency and waste.

"I don't want to see anyone try to sugarcoat something that comes back from audits that is negative," Dixon said.

Enright's Aug. 4 e-mail to "all city department heads" stated that agencies must notify the mayor's office, the Finance Department and CitiStat officials when auditors come calling. Departments are required to get the administration's approval for their answers to auditors' questions and must also share draft audit reports with the administration.

"This new policy ensures that the administration is aware of all active audits, provides an opportunity to aggressively counter negative findings prior to their release to the public and affords us time to develop an effective communications strategy," Enright wrote in the conclusion of his e-mail.

Enright wrote the e-mail on the same day that the Board of Estimates accepted auditor Yovonda Brooks' audit findings on fees charged to companies that rent underground space for wires.

The audit found that $3.5 million in potential revenue was lost over the past three years because rental rates had not been increased in July 2001, as city officials suggested at the time.

Another audit released in April detailed lax fiscal oversight at the Quarantine Road Landfill that led to the theft of more than $200,000. The audit was a follow-up to an earlier report that recommended policies and procedures that might have prevented the losses but were not implemented.

Pratt said she was meeting with Enright today to discuss her concerns. She said she is encouraged that the city wants to work with her office but added that Enright's suggestions may impede audits.

"The independence of the audit process could be impaired," Pratt said. "That last paragraph [in Enright's e-mail] causes some concerns." That paragraph refers to countering negative audit findings prior to their public release.

She did not specify her concerns but said she would release recommendations today to improve cooperation with the administration.

Dixon said she hopes the new policy does not "cover up" audit findings or "bog down" auditors trying to perform their duties in rooting out waste.

"I have a problem with them trying to cover up," Dixon said.

She said city agencies frequently ignore suggestions from Brooks' office.

Stephen Kearney, an O'Malley spokesman, said that the administration's early knowledge of auditors' findings could help it correct problems sooner through CitiStat's statistical tracking of agency performance.

"The aim of this was to make sure we were involved sooner rather than later, and that all the information about what the administration is doing was brought forward" to the auditors, said Matthew Gallagher, director of CitiStat.

Kearney also said administration involvement would help correct misperceptions in audits.

For example, the landfill audit questioned the city's policy of not charging dumping fees to certain city agencies. The city waived the fees so that the agencies could afford more housing demolitions that lead to more development.

Still, Matthew Crenson, a political science professor at the Johns Hopkins University, said the policy looks like "defensive public relations" and that it is driven by territorial politics: O'Malley does not want Pratt uncovering problems in his agencies.

The administration "wants to find [the problems] so they look like they're on top of things," Crenson said. "The fact that audits are going on that the mayor's office doesn't know about is strange."

Former state Sen. Julian L. Lapides, who once ran for city comptroller, said Pratt's office is meant to be a check on the mayor and that her auditors should be allowed to review agencies without executive interference.

"I think that politics today is controlling the spin," Lapides said. "If I were a member of the administration, I'd like it that way - but I don't think it should be that way."

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