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June 7, 2016 — California Primary Election
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— Charter Amendments Related to the Requirement that the City Auditor Perform Close-Out Audits and Investigations of City Officials and Officers Upon their Death, Resignation or Removal from City OfficeCharter Amendment —

Local

City of San Diego
Proposition G Charter Amendment - Majority Approval Required

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Election Results

Passing

192,814 votes yes (70.2%)

81,853 votes no (29.8%)

Shall the City Charter be amended to update language and to repeal the requirement that the City Auditor conduct audits and investigations of City officials and officers upon their death, resignation, or removal from City office?

Summary

This proposition would amend the San Diego Charter by repealing language requiring the City Auditor to conduct close-out audits and investigations of City officials and officers upon their death, resignation, or removal from City office. If the amendments are approved, the City Auditor would be allowed, but not required, to perform future close-out audits under existing authority in a different Charter section. 

— San Diego County Registrar of Voters
Impartial analysis / Proposal

This proposition would amend San Diego Charter section 111 to repeal the requirement that the City Auditor conduct close-out audits and investigations of City officials and officers upon their death, resignation, or removal from City office.

The Charter requires the City Auditor to perform such close-out audits and investigations. The objectives of such audits are to ensure that separated City officials and officers do not have any outstanding debt owed to the City and that any rights conferred to them as a result of City employment have been revoked.

Charter section 111 was originally approved by San Diego voters on April 7, 1931. The language of the original proposition assigned the performance of this close-out audit and investigation function to the then-Office of the Auditor and Comptroller.

Due to the investigation of the City’s retirement system and sewer rate structure by the federal Securities and Exchange Commission (SEC), as well as the issuance of various investigative reports by different agencies on these matters in 2005, the City Council was instructed by the SEC to complete a thorough investigation into its own finances and develop a plan for remediation. In response to this direction, the City Council retained Kroll, Inc. (Kroll) to evaluate those reports and make appropriate recommendations to the City Council, which resulted in the Kroll Report, issued on August 8, 2006.

Among other things, the Kroll Report recommended that this close-out audit and investigation function of City officials and officers set forth in Charter section 111 be assigned to an independent City Auditor, a position which was to be newly created.

On June 3, 2008, San Diego voters approved both the creation of the independent City Auditor under Charter section 39.2 and an amendment to Charter section 111, which assigned this close-out and investigation function to the newly- created City Auditor position.

If this proposition is approved, the City Auditor would no longer be required to perform the close-out audit and investigation function regarding City officials and officers who leave the City. The City Auditor would be allowed, but not required, to perform future close-out audits under existing authority conveyed to the City Auditor under Charter section 39.2. At present, other than the language in Charter section 111, there is no other written regulation that requires this close-out function to be performed regarding elected City officials leaving City office.

The City Auditor proposed this ballot measure after he had conducted 49 close- out audits and not made any significant findings, according to a January 25, 2016 memorandum from the City Auditor to the City Council (Auditor Memorandum). The Auditor Memorandum stated that Generally Accepted Government Accounting Standards (GAGAS) and industry standards do not require a City Auditor to perform close-out audits.

The City Council’s Charter Review Committee approved sending this measure to the ballot and the City Council voted to place it on the June ballot. If approved, the Charter amendments would become effective after they are chaptered by the California Secretary of State. 

— City Attorney
Financial effect

This measure would repeal one sentence in the City Charter to eliminate a requirement that the City Auditor must audit and investigate the accounts of all City officers whose employment is terminated with the City for any reason. This measure may enable the City Auditor to alternatively deploy resources to perform other audit related duties; however, related budgetary savings are not expected.

There is no material fiscal impact associated with this Charter amendment. 

— San Diego County Registrar of Voters

Arguments FOR

The Charter, the Constitution for the City of San Diego, was first written 85 years ago, and has not undergone a thorough review or update since then. Some Charter articles and many sections are simply unnecessary, outdated, confusing, or worse, contain misinformation. The Charter needs to be updated to reflect how the City operates in the 21st Century and to be more open, transparent, and easy for citizens to read.

The Charter Review Committee worked with the City’s Auditor, Chief Financial Officer, the Independent Budget Analyst, the City Attorney and the Mayor’s office to develop these proposed Charter changes.

These recommended Charter changes regarding the City’s requirements for close out audits will:

  • Clarify that the close out audits of officers who leave City employment are routinely performed by the Human Resources Department, not the City Auditor.
  • Note that the Auditor may perform close out audits when he or she chooses to do so, but is not required to do so.

Your “yes” vote on Prop G will update the City’s close out audit requirements to accurately reflect current auditing industry standards and practices.

Prop G has strong support from the City Council, League of Women Voters of San Diego, and the San Diego Regional Chamber of Commerce. 

Sherri Lightner
City Council President

Chris Cate
City Councilmember

Jerry Sanders
President & CEO,
San Diego Regional Chamber of Commerce

Jeanne Brown
President,
League of Women Voters of San Diego

— San Diego County Registrar of Voters

Arguments AGAINST

 No argument against Proposition G was filed in the office of the City Clerk.

— San Diego County Registrar of Voters
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