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HomeMy WebLinkAboutBack-Up - 12.11.14 Discussion ItemD2.1 Hernandez, Julia D. From: Carrillo, Adrian Sent: Monday, October 27, 2014 3:41 PM To: Hernandez, Julia D. Subject: D2. Discussion Items Hello Julia, The commissioner would like to place two discussion items on his agenda. Both are city-wide discussion items. The first is a Discussion Item on the Auditor General's Salary, and the other is a Discussion Item on the "Eye of the Bay" Project located at the FEC Slip. Best Regards, Adrian Carrillo Senior Aide Commissioner Marc Sarnoff City of Miami, District 2 (305) 250 - 5331 1 Auditor General -Salary and Benefits iscussion -Signed 4 year contract effective May 2012 which was up for renegotiation after1 year due to below market salary and benefits. Waited 2Y2 years due to City financial problems, -10 years ago the internal audit department was changed to the independent auditor general function reporting to the City Commission rather than management, and is responsible for providing independent oversight for all City finances and operations. Similar changes were made in other cities and in the Florida State University system to elevate the repotting levels of audit departments in order to achieve greater independence and transparency, At that time, an executive level contract was negotiated with the City's auditor general commensurate with the reporting level and within the range of other City executive contracts. -Currently, the AG salary is paid at a rate that is much lower than other contract employees with similar responsibilities and reporting levels, and does not take into account my more than 17 years prior experience as a chief audit executive with three other organizations, 35 years as a CPA, as well the additional professional certifications of certified internal auditor and certified fraud examiner that are specific to the financial and operational oversight functions of the AG Office. Also, other executive contracts included retirement benefits of up to 20% of salary; well above the 8% City contribution that the AG receives, as well as severance for non -renewal, -As examples, City of Ft. Lauderdale internal audit reports to the Commission and salary is at an executive level, In contrast, the City of Miami Beach internal audit department reports to an assistant city manager and the salary is at the director level. Finally, it should be noted that since the hiring of the AG in May 2012, the department has had actual cash recoveries of $2.7 million as a result of audits, with total department expenses of $2,4 million during this same period. These recoveries include a settlement payment of $1,4 million to the City as a result of a previously completed audit that was discussed on today's agenda (item RE 7), n r6Crie,-.fi t Auditor Ge.nejkSaiary and Benefits Discussion As you can see from the attached article announcing my hiring effective May 7, 2012, the salary and benefits under my approved contract were to be renegotiated in one year, Due to the financial difficulties that the City experienced during 2013, I did not approach you for this discussion. However, now that the City's financial condition has improved so that our reserves are approximately $100 Million after having fallen to $13.4 million in prior years, I think the time is appropriate to renegotiate. A few of my accomplishments during my 2.5 years with the City include: -Recovered over $1.25 million with potential recoveries totaling $7.7 million as a result of various audits in solid waste, leasing and other areas. -Completed more than 35 high quality audits and investigations while developing a flexible risk based approach for the yearly audit plan. -Built the staff from six auditors up to its current level of 10 effective staff; there has been a high degree of stability with no turnover at the professional level -Implemented a successful investigations program that included training of staff in effective investigative techniques and proper documentation requirements For your information, below is a comparison of my salary and benefits with those of the prior Auditor General (AG) as well as salaries for comparable positions: Salary Car & Phone Deferred Comp. Retirement Total Vacation/ Sick Prior AG Current AG $183,000 $145,000 12,000 8,400 20,000 -0- 49,000 11,600 $264,000 $165,000 59 days 30 days *The 29 additional vacation/sick days (59-30) is valued at $20,412 City Auditor- Ft. Lauderdale $184,870 Commission Auditor -Miami Dade-$176,616 County Auditor-Broward $206,675 County Auditor Miami -Dade $223,770 Inspector Gen, —Miami Dade $230,267 Asst. Inspector Gen. Miami Dade $183,069 Audit Director-FIU $167,313-this was my former position V PATRICIA Hovos Miami has officially appointed n independent auditor general fter the city conducted a search hat extended for over six nths. Ted Guba is to assume the role May 7 at $145,000 a year. The previous auditor general was paid close to $183,000 a year, said Commissioner Frank Carollo during last week's com- mission meeting. "I think [the contract] it's something reasonable though some or many would say that hat we negotiated it's actually below market for the position," aid Mr. Carollo, who was in. bharge of negotiating the con- et with Mr. Guba. lr. Guba understands that he be a public servant and un- derstands the financial situation of the city, Mr. Carollo added. He will also receive a smaller car allowance than the former uditor, $500 a month instead. of $800, 20 days of vacation d 10 sick days instead of the previous 45 days. of vacation and 12 sick days, and he won't have a severance package while the previous auditor had sever- ance for six months. His un- changed insurance package is t comparable with that of other city executives, Mr, Carollo said. The salary and benefits under the contract will be up for rene- gotiation in a year.` Mr. Guba requested to begin his four-year appointment in ,May as he - although not required by the charter •-• is in the process of moving within city limits. The commission unanimously chose hint in March to serve as the city's independent watch- dog after the position became vacant last summer. Commis- signers decided not to renew predecessor Victor Igwe's con- tract after he held the job for more than a decade. He sued the airy in October. in a whistleblower suitfor the,r- ing. Since his departure, an. interim auditor, who also ap- plied for the permanent post, filled the vacancy. With over 30 years of experi- ence, Mr. Guba has worked in both private and public sectors, serving as Florida International University's audit director from 1998 until 2007 and, most re- cently, as a budget consultant for the City of Mural, according to his resume. Mr. Cuba came to be chosen after a selection committee nar- rowed the candidate field before i oners made their choice. Commissioners had originally hoped .to choose an auditor in early February after a 1 0-per- son search Committee narrowed more than 30 applicants to five candidates and three alternates. After determining that the pro- cessed was flawed because many of the final candidates lacked sufficient government experience, commissioners voted to start the search pro- cess over again.