Baltimore launches new audits commission

Official says "Only positive things can come out of conducting more audits" in Baltimore.

The city of Baltimore is launching a new audits commission to make sure the finances and performance of city agencies are probed at least every two years.

The seven-member Biennial Audits Oversight Commission includes City Council President Bernard C. "Jack" Young, City Comptroller Joan M. Pratt, Baltimore finance director Henry J. Raymond, acting Inspector General Stephen J. Lesniewski, Jr., and City Council members Eric T. Costello, Leon F. Pinkett III, and Bill Henry.

The first meeting was held Wednesday evening at City Hall.

Officials struggled in recent years to complete voter-mandated audits of 13 key agencies — the city did not complete five of the 26 audits by the Dec. 31 deadline.

In 2012, Baltimore voters ordered city officials to conduct separate performance and financial audits of 13 agencies by the end of 2016. In November, voters authorized an even stricter auditing law, requiring fresh agency audits every two years.

Costello, who sponsored the bill to increase auditing, said the oversight commission will work to ensure there is not a backlog of unfinished audits.

"We won't run into the same problem we had last time," he said.

Auditing the agencies every two years instead of four will make the findings more useful, Costello said. Many of last year's audits looked at data that was three or four years old, limiting the value of their findings, he said.

The commission also plans to examine what auditors should investigate. For instance, Costello said, he's interested in seeing an investigation into whether street light maintenance is being done effectively in Baltimore.

"Only positive things can come out of conducting more audits," Costello said. "This how we get better at delivering services to our residents."

In November, about 83 percent of voters backed the move to increase auditing in Baltimore.

On Wednesday, one of the final audits due in 2016 was delivered to the city's Board of Estimates — about a month and a half late.

A performance audit of the Baltimore Development Corp., which evaluated the agency from July 2013 to June 2015, raised questions about how the BDC reports the number of jobs retained or attracted to the city in a given year.

Auditors also recommended the agency improve the way it tracks the number of companies it works to keep in Baltimore.

Mayor Catherine Pugh and Pratt quizzed BDC president William H. Cole IV on the audit.

Cole told them the city-financed Harbor Point project threw off the number of jobs created during the auditing period.

"It showed a number of 17,000 jobs, and of course, Harbor Point is going to take a decade or more to get there," Cole told the panel. He said that the agency has historically reported job creation numbers projected at the start of the project, but tracks annual job growth to ensure companies are complying with targets contingent on public subsidies.

After the meeting, Cole said the agency will resolve the matter by issuing separate reports to city financial officials and auditors, who want to track them differently. He said they also will study how other cities track job creation.

"There have been no issues with the reporting by any of the businesses, there's been no inconsistencies. We've had no repayments," Cole said. "Everything is tracked appropriately and we get annual financial statements from the businesses we're supporting."

Baltimore Sun reporter Yvonne Wenger contributed to this article.

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