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Controller presents second public integrity review on gifts, urges reforms to prevent pay-to-play
Summary
The Controller27s Office presented a preliminary report on gifts routed to departments through non-city organizations (notably Parks Alliance subaccounts for Public Works), finding weak controls, potential pay-to-play risks, unclear interested‑party definitions, and recommending code and reporting changes.
The Controller27s Office presented its second public integrity review to the Government Audit & Oversight Committee on Oct. 1, focusing on gifts to departments routed through non-city organizations and the risks those arrangements can pose to transparency and procurement integrity.
Acting Director of Audits Mark Dela Rosa summarized the Controller's preliminary assessment. The office surveyed 56 departments and found 33 had some non-city organization accounts or subaccounts. The report examined four Parks Alliance subaccounts tied to the Department of Public Works (DPW) and identified several problems: inappropriate fundraising (behested payments solicited by or at the suggestion of city officials), a narrow definition of "interested party" that may exclude city contractors, anonymous-donation disclosure gaps, weak internal controls and MOUs governing relationships with non-city organizations, and use of subaccounts to fund staff appreciation outside the City's formal budget controls.
Dela Rosa said the Controller recommended amendments to the campaign and government conduct code to prohibit solicitation of donations by non-elected department heads and employees unless explicitly authorized by the Board, expand the ethics commission27s interested-party definition to include city contractors, require adherence to the Sunshine Ordinance disclosure rules for non-city organizations, formalize MOUs and posting of such agreements on department websites, and institute sample-based audits of such nonprofits by the Controller.
Supervisors asked about reimbursements and the scope of the problem beyond DPW. Dela Rosa said reimbursements often went to department staff or vendors and that the Controller concentrated field work on Public Works but intended recommendations to be applied citywide. Supervisor Matt Haney described the Public Works arrangements as creating a "slush fund" that subverted procurement protections and said he and Supervisor Peskin will introduce legislation to expand interested-party definitions and curb such payments.
A caller (Anastasia Yovanopoulos) urged implementation of recommendations to prevent pay-to-play. The committee agreed to continue the hearing to the call of the Chair to allow further work and follow-up presentations, including from the City Attorney.
