Audit finds gaps in consultant contracting and recommends stronger needs assessments and performance evaluations

Assistant City Auditor Keith Salas presented the consultant-spending audit to the committee, noting the city spends roughly $93,000,000 annually on consultants over the past three fiscal years. The audit focused on "general services" consulting contracts and sampled 28 contracts. Key findings: about one-third lacked written needs assessments explaining why the consultant was required; more than 80% lacked documented evaluations showing the work could not be done by city staff; roughly 16% of deliverables were not measurable, specific, and time-bound; and closeout documentation and performance appraisals were inconsistent.

Salas highlighted examples including contracts where staff could not produce a scope of work, contracts where deliverables were vague ("assist in monthly committee meetings"), and closeouts that reported full fulfillment despite earlier evidence of early termination. The audit recommended clearer guidance to departments on needs assessments, preserving deliverables and documentation, and requiring performance evaluations and lessons learned to inform future hiring.

James Scarborough, Chief Procurement Officer, acknowledged the findings and said procurement will expand contractor performance evaluation beyond design and engineering services to general services and improve file-checking processes. Financial Services Deputy Director Kim Olivares said the audit aligns with shared-services and organizational excellence work already underway.

Why it matters: The city’s large consultant spend and the audit’s findings point to opportunities to improve accountability, documentation, and value-for-money reviews for a broad array of services.

What’s next: Procurement and financial services committed to implementing the audit recommendations and to presenting follow-up updates to the committee.