Get Full Government Meeting Transcripts, Videos, & Alerts Forever!
Get email alerts on the Municipal Audit Contract topic
No spam. Unsubscribe anytime.
Finance committee defers RKO audit contract after councilors object to 45% price increase
Summary
Bangor City finance staff recommended renewing a three-year contract with auditor RKO; councilors raised concerns about a first-year 45% cost increase, limited bidder response, and timeliness. The committee pulled the item from next week's council agenda and requested comparisons and more information.
Bangor City finance staff recommended on March 17 that the city extend its contract with RKO (the current auditor) for three years to perform the city's annual financial audit. Finance Director David Little said RKO has been the city's auditor for 13 years and proposed a first-year cost of $174,500. Little explained the audit is complex, requiring testing across seven enterprise funds, the school department and more than 80 grant agreements, and he said the bid estimated 1,038 hours of work.
"We are required to have an independent auditor, so we do need to have one on file," Little said. He told the committee the request for proposals was publicly posted and that RKO was the only responsive bidder, which he attributed to a shrinking pool of firms willing to do governmental audits in Maine.
Councilors pressed staff about price, past performance and process. Councilor Michael Beck said, "My first problem with this is, it's a 45% increase over the last year for the first year. That's 45% more." He and other committee members said past audit firings of responsibility had contributed to late filings in recent years and that the lack of competing bids produced a monopoly effect. Little and the city manager described widespread staffing shortages at municipal audit firms and pointed to new accounting pronouncements and additional federal testing requirements as drivers of higher audit costs and hours.
Committee members did not approve the three-year contract during the meeting. Instead, the committee asked staff to pull the item from next week's full council agenda, gather comparative data (fees, billed hours and travel) from other municipalities and auditors, and return the matter to the finance committee with additional information. Staff also said the city could negotiate contract provisions such as a shorter initial term or termination language and consider adding penalties for missed deadlines.
No formal tally of a vote to defer appears in the transcript; the committee scheduled a follow-up discussion and directed staff to provide comparative materials before the contract goes to council.
