Taxpayers are due diligent oversight of city contracts

THE ISSUE The city auditor has found questionable practices and a lack of accountability in awarding of personal services contracts.

AN AUDIT of personal services contracts that bared lack of accounting, questionable practices and a disregard of ordinances and the City Charter undoubtedly will add to taxpayers' skepticism that their money is being used wisely.

Though most of the abuses took place under the Harris administration, the City Council must diligently oversee current contracts and insist that the city's financial and personnel directors provide the reports that law requires so members can check the books.

The audit took a look at the contracts city agencies use to hire employees outside of the civil service system. The contracts are supposed to span no more than a year and be awarded for "unique" services that are outside the skills and expertise of regular workers and/or for purposes essential to the public interest. However, the audit found that the contracts often were issued in disregard of those requirements and in some cases to political insiders.

In fiscal year 2004-2005, 1,909 employees were on personal service contracts, constituting 20 percent of the city's total workforce. The majority appear to have been legitimately issued -- such as to part-time summer fun and recreation workers -- but others were not.

In a number of cases, people were hired for departments in which staff cutbacks had hampered operations, to allow funds pegged for capital improvements to be used for salaries or to attempt to privatize functions normally done by civil service workers.

In addition, contracts were held longer than law allows. From July 2002 through June 2005, 251 individuals held contracts for more than a year, 159 for more than two years and 56 for three years.

Among the questionable practices was the hiring of personal friends or political supporters that bypassed required approval of city agencies. The audit points to three instances -- in September 2003 and in February and September 2004 -- in which the secretary of the managing director, presumably Ben Lee, approved contracts. Two of those were filled by former members of the City Council, according to the audit.

The audit also faults officials for failing to compile required reports on the contracts. In fact, the audit says, "the Department of Budget and Fiscal Services has never complied with a 1997 ordinance to report annually on the city's personal services contract."

Without such accounting, neither the Council nor the public can ascertain whether contracts are being handled properly. It is incumbent on Council members to assure taxpayers these shady practices will not continue.