Great Park auditors go over budget, request more money

Voice of OC Register: Supporters of Great Park audit hypocritically ignore transparency

IRVINE – Two firms charged with auditing Great Park spending went $283,940 over budget and are asking the city to pay.

City Council members retained Newport Beach-based forensic auditing firm Hagen, Streiff, Newton & Oshiro Accountants PC for $240,000 to do an audit of the Great Park project in 2013. The firm was tasked with accounting for more than $200 million spent on planning, development and construction at the former El Toro air base.

In 2014, law firm Aleshire & Wynder was brought in to help determine whether money was mismanaged or misspent.

Now, more than $1.4 million has been spent on the investigation and the council Tuesday afternoon is slated to consider requests for more money.

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Aleshire & Wynder wants $216,683 more than was budgeted. Of that, city staffers recommend paying out $56,174, about a quarter of the amount requested.

In a letter to City Manager Sean Joyce, the firm’s managing partner David Aleshire said pressure from Irvine officials to complete the audit in March pushed his firm over its $465,000 budget.

The directive to submit conclusions to the council ahead of its March 24 meeting had Aleshire & Wynder attorneys and staff “working 18 hour days,” he said. Even so, the final report “was barely complete” when the council reviewed the firm’s findings.

“Placed in a difficult position,” the firm “decided to make the priority finishing the report rather than ending up with more political theater about the never-ending report,” Aleshire said, even though a significant chunk of the firm’s budget was already exhausted.

However, “if it was wrong and you don’t want to pay us, we are in a business where hard choices must be made and sometimes they don’t work out,” he said.

Pressure to complete the report on a tight deadline may also have been an issue for the forensic auditing firm, which wants $67,257 more from the city. Great Park was misspelled Great “Part” on the first page of the firm’s final report, issued in March.

Staff is recommending the city pay nothing additional to HSNO because no purchase order was submitted by the firm for the additional work as required under its contract with the city, according to a staff report. The firm’s budget for audit work totaled $778,000.

The practice of amending contracts to cover work done without budgetary authorization is something auditors scolded Great Park managers for allowing in their March reports, which concluded that the Great Park project had wasted taxpayer money.

“Significant project change orders are generally a sign of lack of definition of project scope at the beginning of the project, or poor project management,” the law firm reported.

The council, acting as the Great Park Board of Directors, is slated to vote first on the firms’ requests during the Great Park board meeting at 3 p.m.; then as the City Council during a subsequent meeting scheduled for 4 p.m.

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