Auditor General says city saved $35M in 2018, some employees dismissed amid complaints
Published Thursday, February 14, 2019 4:29PM EST Last Updated Thursday, February 14, 2019 7:15PM EST
The city saved more than $35 million in 2018 as a result of recommendations issued by office of Auditor General Beverly Romeo-Beehler.
Romeo-Beehler’s annual report, which will be considered by the audit committee next week, says that in 2018 there was a total of $35.8 million in savings and additional revenue. The financial benefit was a result of recommendations implemented last year. Those same recommendations are also expected to result in $97.2 million in recurring savings over the next four years.
The recommendations were contained in 14 audit reports, four of which were issued in 2018, and the rest issued in previous years.
“Since 2014, by implementing our audit recommendations, the city has achieved significant savings,” Romeo-Beehler wrote in her report.
“This translates to a return of $11.7 for every dollar invested in our office. I would like to thank management and staff from the various city divisions, agencies and corporations we've worked with. Their continued effort to implement our recommendations helps the city realize these savings.”
Millions in savings identified
Some of the biggest contributors to the savings realized in 2018 include a report into uncollected lease revenue from Union Station tenants. Romeo-Beehler wrote that a result of that report, city staff collected $5.7 million in outstanding payments.
Another report into the TTC’s procurement practices also resulted in significant savings. Romeo-Beehler said that as a result of recommendations made by her office, the TTC saved $2.19 million in 2018 and expects to save an additional $1.5 million in 2019, mostly resulting from an “increased use of blanket orders and efficiencies in the aftermarket warranty program.”
Another report into the $577 million in outstanding fines owed to the city is also expected to result in more money for city coffers, Romeo-Beehler wrote.
She said that because of a recommendation from her office, the city was able to add $710,000 in outstanding fines to the property tax bills of some residents. She noted the move is expected to “improve the collection of fines that otherwise might have been written off.”
“This has shown to be an effective tool, with a past collection rate of over 90 per cent. However, we found that not all eligible fines were being identified by court services,” Romeo-Beehler said.
Numerous employees terminated as a result of anonymous tips
In addition to the 12 conventional audits and one major investigation completed by her office in 2018, Romeo-Beehler said that a fraud and waste hotline also proved to be a valuable tool. She said that the hotline received 643 formal complaints in 2018.
One of those tips concerned an employee who allegedly altered official city documents and sold them to third parties for financial gain. Romeo-Beehler said that employee eventually admitted to altering more than 100 documents and was terminated.
She said that another tip concerned an employee who was not working their full shift and was “leaving the workplace without authorization during the shift.” She said that an investigation revealed that the city lost approximately $10,000 as a result of time theft. That employee was also terminated.
Another tip, meanwhile, concerned an employee who was allegedly stealing food and city equipment. Romeo-Beehler said that employee was also terminated and a number of steps were taken to prevent similar incidents.
“The division has taken a number of steps to strengthen their internal controls, including a management review of staff access to the area where the theft occurred and readjusting the security cameras to reduce blind spots. In addition, the division is revising their standards of employee conduct to strengthen the standard on theft or borrowing of property belonging to the city,” she wrote.
In total, seven city employees were fired, Romeo-Beehler said.
Mayor John Tory expressed support for the terminations.
“My personal standard has been that when people are found to be doing things that are worthy of termination, they are shown the door and that’s, I think, quite appropriate,” he said.
The employee conflicts and thefts cost taxpayers $670,000, according to the auditor general.
“I want every tax dollar, rather than wasted or stolen, go into the services that Torontonians demand and expect from city hall,” noted city councillor Josh Matlow, who is on the audit committee.