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City of Palo Alto
City Manager’s Report
13
HONORABLE CITY COUNCIL
FROM:CITY MANAGER DEPARTMENT: CITY MANAGER’S OFFICE
DATE:JUNE 9, 2008 CMR: 277:08
SUBJECT:REFERRAL OF THE CRISiINAL INVESTIGATION OF THE
CHILDREN’S THEATRE TO EITHER THE CITY AUDITOR OR THE
POLICE AUDITOR
BACKGROUND/DISCUSSION
On May 19, 2008, the City" Council voted 8-0 to bring back for discussion a potential referral of
the criminal investigation of the Children’s Theatre to either the City Auditor or the Police
Auditor (See Attachment A).
In preparation for discussion of this item, staff contacted the City’s Police Auditor to discuss the
potential referra!. The Police Auditor indicated that a review of this criminal investigation would
focus on ~,o key questions: 1) was there probable cause for the investigation? and 2) was the
Police Department’s response to the information they received appropriate at the outset and as
the investigation developed? The Auditor would primarily focus on a review of documents
related to the investigation and would interview the District Attorney as well as Police personnel.
If the Council votes to refer the criminal investigation of the Theatre to the Police Auditor, staff
would bring a separate contract for this audit back to the Council for approval.
While it is very unusual to have a criminal investigation reviewed by a party other than the
District Attorney’s office or a Department of Justice representative, staff would support this
review by the Police Auditor because of the communit)~ concern.
On a separate but related note, the City Manager, under his authority, has initiated a review of
cash handling, expense reimbursement and travel expense procedures cit?a~Tide. The City
Manager wil! contract with an independent accounting firm to perform this review. The review
will focus primarily on the current internal policies and procedures related to these matters,
especially at satellite City- facilities. The end product would be a report of recommendations
detailing if and how- these policies and procedures should be improved. Staff has developed a
scope of services and wil! be circulating it to several firms specializing in governmental
accounting. Staff anticipates having a firm on contract within a few- weeks.
CMR:277:08 Page 1 of 2
RESOURCE IMPACT
The review of the Children’s Theatre investigation by the Police Auditor would have a resource
impact to the City. If the Council supports the referral, staff would bring back a contract and
funding request for Council approval. The current contract with the Police Auditor does not
have sufficient funding to accommodate this type of review.
Attachment A:
CITY MANAGER:
Excerpt of minutes from May 19, 2008 .Council meeting
F 1L4~N K BENEST
City Manager
CMR:277:08 Page 2 of 2
EXCERPT FROM MAY 19, 2008 CITY COUNCIL MEETING
MOTION RESTATED: Council Member Kishimoto moved, seconded
by Council Member Morton to agendize an item to refer the criminal
investigation of the Children’s Theatre for review by either the Police
Auditor or City Auditor.
Council Member Morton asked to clarify if this would be a discussion at
which it would be appropriate to make that decision. We’re not in fact
making that decision. The agenda item would be whether the Council
should refer to the Police Auditor or to the internal auditor.
Mayor Klein stated that is correct and keeping with our procedures on
other matters during the year, we have used this section of the
agenda to agendize other matters which means the only thing we are
voting on is to put it on the agenda. We are not voting on the merits
of it one way or the other, all you are saying if you vote yes you would
like to see this on a future agenda.
Council Member Morton stated at which time the Council will have the
ability to discuss this matter in detail. I would urge my colleagues to
support this Motion there is certainly concern in the community that
this discussion occur.
MOTION PASSED: 8-0, Barton not participating