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HomeMy WebLinkAbout2022-03-22; City Council; ; Code Enforcement Program Audit and Status Update on Open Audit Recommendations from Previous Audits•CIT V CO UNCfl Staff Report M eeting Date: To: From: Staff Contact: March 22, 2022 Mayor and City Council Scott Chadwick, City Manager Robert Threatt, Internal Audit Manager robert.threatt@carlsbadca.gov, 442-339-2418 Laura Rocha, Deputy City Manager, Administrative Services laura.rocha@carlsbadca.gov, 442-339-2415 CA Review CKM Subject: Code Enforcement Program Audit and Status Update on Open Audit Recommendations from Previous Audits District : All Recommended Action Receive a presentation on the results of an internal audit of the city's code enforcement program and a status update on the open audit recommendations from an internal audit of the city's credit card program performed in fiscal year 2020-21. Executive Summary/Discussion The City Council approved the fisca l year 2021-22 Internal Audit Plan, which included an audit of the city's code enforcement program. The results of the audit, which are attached as Exhibit 1, found the code enforcement program is well supported by existing policies and procedures. This was evident in the results noted during testing of audit selections. The area of greatest opportunity for improvement noted during the audit related to the city's management of case file data. This is code enforcement data t he city's code enforcement officers enter into the EnerGov enterprise system for every code violation they investigate. Utilizing the available data, management has an opportunity to identify key metrics and strengthen reports generated from existing code enforcement data. Such value-added reports will enable management to further develop staff and to maximize available staffing resources. This presentation will cover the audit's objectives, methodology and provide a summary of the results. (See Exhibit 1.) It will also co"'.er t he four corrective actions the internal auditor recommended to the city's Code Enforcement Division in response to the audit results. In fiscal year 2020-21, the city's internal auditor performed an audit of the city's credit card program that resulted in eight audit recommendations, with which management concurred. {See Exhibit 2.) Of the original recommendations, two remain open. This presentation will also provide the City Council with a status update on those items. March 22, 2022 Item #8 Page 1 of 17 Fiscal Analysis The presentation on the code enforcement program audit results, as well as the status update regarding the open audit recommendations are informational items with no direct fiscal impact. Next Steps The Internal Audit Manager will monitor the status of the four new audit recommendations until they are fully addressed. Environmental Evaluation This action does not constitute a "project" within the meaning of the California Environmental Quality Act under California Public Resources Code section 21065 in that it has no potential to cause either a direct physical change in the environment, or a reasonably foreseeable indirect physical change in the environment. Public Notification This item was noticed in keeping with the state's Ralph M. Brown Act ~nd available for public viewing and review at lea st 72 hours before the scheduled meeting date. Exhibits 1. Report 2022-02, Code Enforcement Program Audit 2. Open Audit Recommendation Status Report March 22, 2022 Item #8 Page 2 of 17 March 22, 2022 Exhibit 1 Internal Audit of the City's Code Enforcement Program REPORT March 2022 Robert Threatt Internal Audit Manager Report 2022-02 Item #8 Page 3 of 17 Exhibit 1 TABLE OF CONTENTS INTRODUCTION Scope & objectives ......................................................................................................... 3 Methodology .................................................................................................................. 3 Summary of results ........................................................................................................ 3 Background ..................................................................................................................... 4 O BJ ECTIVE 1 : POLI CI ES A ND PROCEDURES Policies and procedures objective .................................................................................. 4 Test results ..................................................................................................................... S OBJECTIVE 2 : ADHERENCE TO GUIDELI N ES Adherence to guidelines objective ................................................................................. 8 Test results ..................................................................................................................... 9 OB JECTIVE 3 : METRICS AND REPORTING Metrics and reporting objective ..................................................................................... 9 Test results ..................................................................................................................... 10 REC O MM EN DATI O N S Recommendations and management's response .......................................................... 13 2 I Audit of the City's Code Enforcement Program March 2{ 2022 Item #8 Page 4 of 17 Exhibit 1 INTRODUCTION Scope & objectives The period covered by the code enforcement program audit included fiscal years 2018-19, 2019-20 and 2020-21. The audit had three objectives: • To assess whether the division has reliable policies and procedures to support effective code enforcement • To evaluate whether a selection of cases from the most recent three-year period adhered to applicable guidelines • To assess whether the city uses case data and metrics to provide meaningful information to management Methodology • Interviewed city staff from the Community Development and the Information Technology departments • Ana lyzed three fiscal years of code enforcement case file data • Performed direct observations via a ride-a-long with a code enforcement officer • Researched city policies, guidelines and the municipal code • Researched programs from comparable cities in San Diego County • Received demonstrations of new technologies, one hosted by the city and another by a third party, both of which are expected to support code enforcement activities Summary of Results The audit procedures resulted in the identification of audit recommendations for management's consideration. The first area evaluated was the city's policies and procedures on code enforcement activities. Code enforcement staff rely heavily on the municipal code and the city's Case Prioritization and Process Guide when carrying out their duties. While these resources provide the program foundation and framework within which code enforcement staff operate, it's recommended the city publish a set of core procedures to serve as a training resource for the city's code enforcement officers. The second objective called for the evaluation of the prior three years of documented code enforcement case files. The auditor evaluated case files for the degree to which code enforcement personnel adhered to existing guidelines. This objective was achieved by selecting samples of case files from the three-year period. Samples were selected using varying procedures t o ensure a representative sample. The final objective called for an evaluation of how well the city leverages its case file data to track and report on key metrics. To evaluate the city's use of data, t he city's internal auditor examined the code enforcement program's reporting activities and the enterprise system that maintains the case files. This was achieved primarily by interviewing code enforcement Exhibit 1 and information technology personnel and reviewing reports available in EnerGov, the enterprise system.that maintains code enforcement data. Background The Code Enforcement Division administers education and enforcement activities to promote compliance with local code sections and maintain a safe living and working environment, while also seeking to maintain the quality of life Carlsbad residents have come to enjoy. Th e division achieves these goals by evaluating and enforcing code compliance on a wide range of issues. The issues range from construction without a permit, unsafe buildings, junk and debris on private properties, inoperative vehicles in front yards, sign standards, property maintenance and construction noise, among others. The Code Enforcement Division is comprised of five full-time code enforcement officers: a division manager, a senior code enforcement officer and three part-time code technicians, one of which assigned to the weekend shift. There are two part-time positions assigned to support compliance with the short term vacation rental regulations. There are also one to three part-time administrative assistants who support the code enforcement program by receiving incoming calls, assigning reports of possible code violations and by mailing the notices generated by the different enforcement actions. Code enforcement officers receive complaints of possible violations through several intake points. This includes calls made to a dedicated code enforcement phone line, a dedicated email account, complaints relayed from city staff or through direct observation by code enforcement officers. The goals of the code enforcement program include ensuring compliance with established state and local regulations to protect public health, safety, and general welfare and to maintain the high quality of life enjoyed by the City of Carlsbad. Experience has shown that non-compliance in large part stems from a lack of knowledge of the city's building and municipal codes. To account for this lack of familiarity, code enforcement officers follow progressive citation protocols (as detailed in t he Case Prioritization and Process Guide, on pages 19-20). The protocols are designed to resolve issues of non-compliance at the lowest level possible, and begin with educating the property or business owner about the relevant code section{s). OBJECTIVE 1 : POLIC I ES AND PROCEDURES To assess whether the division has reliable policies and procedures to support effective code enforcement. The process of evaluating the city's policies and procedures to determine the degree to which they support the code enforcement program began with identifying the specific policies or procedures intended to support the code enforcement program. This was achieved by interviewing management, reviewing program resources, such as the city's code enforcement website and through the auditor's observations during the course of the audit engagement. The auditor determined the relevant policies and procedures were comprised Exhibit 1 of the Carlsbad Municipal Code and the Case Prioritization and Process Guide. While other documents were identified, such as guidelines for the placement of politica I signs, or street and sidewalk vendor guidelines. Those guidelines all originate in the municipal code. Both the municipal code and the Case Prioritization and Process Guide house key policies and procedures that support the city's Code Enforcement Program. The auditor then evaluated these policies and procedures identified by interviewing code enforcement officers rega rding their use of the noted policies and procedures, and by testing documented case files from fiscal years 2018-19 through 2020-21. The auditor tested the case files for evidence that the documented procedures were followed, and that the policies were adhered to. Collectively, these procedures permitted the auditor to determine the degree to which t hese policies and procedures are utilized and if there are any gaps in existing measures that require addressing. During the testing of audit samples (Objective 2) and throughout this audit, the policies and procedures were evaluated for their collective coverage and impact on the city's code enforcement program. The auditor found the Case Prioritization and Process Guide provided more than just a broad framework for code enforcement staff to operate within, but also a detailed set code enforcement processes and guidelines. One such guideline is known as the Progressive Citation Protocols, which identify a hierarchy of progressively stronger enforcement actions that code enforcement officers are to follow. The idea behind progressive enforcement actions is that a bulk of the code enforcement violations stem from a lack of familiarity with the code requirements on the part of the city's property and business owners. Therefore, the city has chosen to progress through a set of warnings and notifications, giving its community members ample opportunity to correct the identified violation without the appllcation of any administrative citations or fines. The following outlines the different steps found in the Progressive Citation Protocol (Case . Prioritization and Process Guide, pages 19-20). • Verbal Warning -Allows 24 hours for the property owners to correct an error. This is typically reserved for very minor violations such as trash cans left on the street for too long. Larger or more significant issues of non-compliance often begin with a courtesy notice. • Courtesy Notice (CN) -A written warning, for violations that aren't as minor in nature, which typically includes a 14-day compliance period to permit the property or business owner time to resolve the issue. • Notice of Violation (NOV) -A notice of violation is sent to the property or business owner if they fail to comply with the previously referenced notices or verbal warnings. The not ice will also come with a compliance period, typically 14-days as with the courtesy notice. It isn't unusual for a code enforcement officer to issue a second notice and compliance period before escalating a matter to a citation. • Administrative Citations (AC) -The escalation of the issues to administrative citations is reserved for cases of non-compliance where the responsible party fails to timely comply and generally fails to put forth a good faith effort to resolve t he matter. Adm inistrative citations start at $100 per violation, then increase to $200 and then $500 per violation. • Referral to City Attorney's Office -If administrative citations do not gain the attention of the property or business owner, code enforcement officers have the ability to refer matters to the City Attorney's Office for additional escalation. Exhibit 1 There was a clear pattern observed during the testing of case file selections for the prior three fiscal years. Across each of the years, despite notable amounts of staff turnover, code enforcement performance was very consistent with respect to the application of the progressive citations protocols. The protocols had resulted in a standardized approach to managing code violations, or at a minimum, based on the sample of case files examined. In case file after case file selected and reviewed during the audit test work, it was noted that officers consistently issued warnings, either a verbal or a written courtesy notice -or two. Then only after sending a notice of violat ion and providing generous compliance periods, typically lasting 14 days, did officers issue administrative citation{s). An example of the progressive citation protocols being followed was noted in case file 2020- 1, which involved a boat being stored on a home's front lawn, in violation of city regulations. This case was opened in Oct. 2020 and resolved in Sept. 2021. The case started with a courtesy notice and eventually progressed on to one administrative citation and then a second. The property owner appealed the citations. The first citation was upheld and the second was set aside for 30 days to give t he property owner time to comply. The property owner was unable to do so, so the second administrative citation was reinstated. The property owner had to pay $300 in fines and eventually moved the boat to an off-site storage location. While the case results in fines, the code enforcement officer and also the administrative hearing official, provided opportunities to avoid fines. Case file 2020-2 provides a second example of the use of the progressive citation protocols. In this instance, the code enforcement officer was assigned to address violations at a house with severely overgrown vegetation and accumulated junk throughout the yard. Th e officer worked closely with the property owner as was evidenced in the 41 different activities recorded in the case files. Those activities included 19 site visits and five phone calls, which culminated in a positive result for t he property owner, the reporting party and the city, with no administrative citations applied because the property owner saw the project through to completion. The code enforcement officer followed the established process and the property owner ultimately complied voluntarily. The code enforcement officer had opportunities to progress to administrative citations. While that may have led to a quicker resolut ion, the officer exercised discretion, which is permitted in the guidelines. By the time the yard was cleared of storage and severe overgrowth, the reporting party was aiding the property owner with the clean-up. Ma1'i:h 21, J6212,de Eafo,cemeo< Prng,am Aodlt Exhibit 1 The Case Prio ritization and Process Guide also includes a system through which complaints or reports of non-compliance are categorized and prioritized. With those steps, comes a standard timeline for when certain categories of case files are expected to be addressed (see Case Prioritization and Process Guide, pages 23-24). The purpose of this process is to prioritize cases and to assign code enforcement staff to the cases (complaints) known to cause the greatest impact to either the condition of a property, to a business or posing a threat to the residents of the city. The city developed and published categories 1-4 in the Case Prioritization and Process Guide and assigned target response dates, referred to as goals, by when each category of complaint is expected to be remedied. · Prioritizations and timelines Violation Description of City's initial Crty's target for category Types of violations (priority) conditions response resolution Immediate threat, Severely damaged unsafe and structure, Within one Within 3 business 1 hazardous unsecured and/or business day of days of complaint. conditions abandoned complaint structures Inoperable or Nuisance and abandoned Within t hree Within 30 business 2 blight-causing vehicles, outdoor business days days storage, trash and debris Vegetation/yard, Within five Within 50 business 3 Miscellaneous lighting, business business days days license Permanent encroachments on Within ten Within 90-180 4 Permit requiring right-of-way, business days business days construction, grading In addition to the Case Prioritization and Process Guide, the city's municipal code provides the underlying authority for the enforcement activities undertaken by code enforcement officers. Collectively the city's municipal code and the Case Prioritization and Process Guide provide considerable policy and procedure support for code enforcement activities. The only area where the auditor was unable to identify any support is in t he area of training. It's recommended that the division creat e a code enforcement procedure manual to serve as both a resource for day-to-day .activit ies and as a training document for new staff. Recommendation 1: The Code Enforcement Division should immediately develop and implement a code enforcement procedure manual to serve as both a training and operations resource for staff. Exhibit 1 OBJECTIVE 2 : ADHEREN CE TO GUIDELINES To evaluate whether a selection of case files from the most recent three-year period adheres to applicable guidelines The procedures the auditor performed to test whether code enforcement activities adhered to program guidelines involved examining selected case files from fiscal years 2018-19, 2019-20 and 2020-21. The selections, case files stored within EnerGov, the system the city uses to track code enforcement activities, were evaluated for adherence to code enforcement guidelines such as those in the Case Prioritization and Process Guide. The initial audit selections were made using a statistically random sample. Using that process, a sample size of 15 was made from each of the three fiscal years. During the course of testing the randomly selected case files it was noted that the random sample was not representative of the population of case files in that it lacked differentiation in the types, known as sub-groups in EnerGov. Below are a number of the common categories cited in code enforcement case types: Examples of categories found in EnerGov • Unpermitted construction • Illegal construction • Short term vacation rentals • Trash/debris • Noise (Construction times) • Outdoor storage • Right-of-way encroachments • Vegetation {overgrowth) • Zoning violations To ensure the audit tested a representative sam pie of case files from EnerGov, a batch of 15 haphazard sample selections was made from each fiscal year. A haphazard selection is a non-statistical sample that is influenced by auditor judgment. In this case, it enabled the auditor to make a representative sample selection without making an excessive amount of selections that would have been required if solely relying on random statistical sampling. The chart below that shows, by fiscal year, the total number of case files subject to audit procedures. It also shows the two types of samples that were made, and the number of selections made using each sam piing technique. Audit sample sizes are a factor of the number of data entries being tested, the goals of testing and the assessed level of risk that the selected samples will not be in compliance with stated standards. In the case of testing code enforcement case files, while there were a moderate number of data entries, the initial test results of the random samples resulted in a very low assessed risk level, resulting in the sample sizes noted below. Ma,th 21' l!lill,de EITToccemeet Prngrnm AcdU ( City of Item #8 Carf st:Jftd.7 Exhibit 1 Code enforcement cases Fiscal year Total case files Random sample Haphazard sample 20~8-19 941 15 15 2019-20 738 15 15 2020-21 : 855 15 15 Testing t he selected case files found consistent results: staff consistently used the progressive citation protocols in how they managed cases and followed the standard guidelines in carrying out their duties. The auditor found consistency in how they progressed through the different notifications, with a warning, then a courtesy notice, a first notice of violation, a second and, finally, and only when needed, administrative citations. A designated training officer would provide for greater consistency. Recommendation 2: Management should identify a code enforcement officer to serve as a training coordinator for the division. Identifying such a role will help ensure t he code enforcement officers continue to maintain their uniform approach to addressing complaints and serving the city's residents and businesses. The uniformity will result in part from having a single point of contact for training and from the implementation of a code enforcement procedure manual, as noted in Recommendation 1. OBJECTIVE 3 : METRICS & REPORTING To assess whether the city uses case data and metrics to provide meaningful intormation to management. The primary methods the auditor used to assess how the city uses its case file data in EnerGov were interviews of staff and a review of EnerGov's reporting functionality. Initially, interviews were focused on the code enforcement program staff but were expanded to IT Department personnel to assess EnerGov's functionality and the process the city uses to manage the enterprise system. On Aug. 20, 2021 the city's internal auditor met with Code Enforcement Program Manager Dave Thielker, to discuss the use of data and the tracking of metrics. During the meeting Mr. Thielker said code enforcement data was not being routinely supplied to different levels of management. He attributed that in part to the limitations of the reporting features of the EnerGov system. Mr. Thielker noted that EnerGov does have a number of ready-made reports that can be generated. However, their use and impact are limited in part because the data requires heavy formatting once it is exported, and, in some cases, needs to be merged with other reports to enable effective analysis. This is in part because the standard system-generated reports provide very segmented data. Ideally, code enforcement staff would have access to comprehensive reports that are ready made and do not require labor- intensive filtering or formatting before they can be shared with decision makers. tf Ci of Item #8 cmslijcf Exhibit 1 When questions then focused on t he EnerGov system and its functionality, Mr. Thielker indicated he was actively working with the Information Technology Department to improve upon the reports in EnerGov. The goal is to develop improved performance management t ools and reports to track code enforcement trends that would provide actionable data to management. These steps address the focal point of the third audit objective directly. The city has significant amounts of dat a at its disposal. Seeing certain improvements through to completion would enable management to regularly obtain reliable and actionable data, maximize existing staffing resources and enable the program manager to further develop those staff, all significant benefits for the city. At the time of the audit fieldwork, the Code Enforcement Division had several open requests to t he Information Technology Department for improvements to EnerGov, as shown in the table below: Open and active ServiceNow tickets as of Oct. 2021 Priority Filed Request Report for a time period on: cases opened/ closed, 2-High 1/21/2021 number of inspect ions completed, number of re- inspections completed, number of notices issued, number of citations issued. ,. Create report showing which sections of code are 3-Moderate 1/21/2021 currently in the database, their violation descriptions, the corrective courses of action, Create a report by code officer assigned on cases due 3-Moderate 1/26/2021 for re-inspection and their dates. Prefer to be able to list the case number, case category, sub type, last i . action completed and re-inspection date The auditor met with Paul Waldron, Information Technology Project Manager, to gain insight into how these requests for improvements were ma naged. This included who received and was assigned to address the service tickets, how the priorities were managed within IT, barriers, or delays that a ticket may encounter and communications with the requestor. Service requests are filed by staff from the Code Enforcement Division with an initial priority rating and tracked by IT Department staff in a system called ServiceNow. These inquiries revealed opportunities for improvement in how the Information Technology Department and Community Development Division communicate about such request s for improvements in software applications. tf Ci of Item #S chisfiflcf Exhibit 1 Mr. Thielker said he met with business systems specialist staff in Information Technology on a bi-monthly basis to discuss code enforcement tickets. During the recurring meetings, they would discuss pertinent details of any open tickets including their current status, any cha llenges encountered and their prioritization. Paul Waldron confirmed this process but emphasized that the business systems specialists also must balance competing priorities from different work groups with the available resources that serve t he entire city, including significant IT projects. So, while t he staff member making the request may have indicated a certain priorit y level - in this case, t he above referenced improvements to EnerGov were of a high or moderate priority to the Code Enforcement Division -the requests were t hen reassessed from a city- wide perspective by the business syst ems specialists and the IT Department. Mr. Waldron noted that in addition to Code Enforcement and other divisions in Community Development each meeting with t he business systems specialists, the Community Development Department overall had a management representative that he met with routinely to discuss department-wide priorities. Ultimately there were three priority sett ing steps in this process. The first instance was upon entry of t he service ticket into the system used to track such requests, then when it was adjusted, at times, as the result of meetings between the Code Enforcement Division and business systems specialist staff due to any of several reasons. Those reasons included the available resources or the feasibility of a request. Then, t he third instance was when the department overall communicated to the IT staff any departmental priorities that tied into city initiatives. The communication among stakeholders and the IT Department is critical and the city had at least three points where priorities were evaluated. That is a healthy level of communication for such a process. However, a common risk with business communications is ensuring they are coordinated and well communicated to all stakeholder groups. The auditor discovered through discussions with Mr. Thielker that he was unaware of the departmental priorities being overlaid upon his division's requests. This may very well have contributed to t he delay in addressing certain of the division level priorities. At a minimum, it caused uncertainty from the division's perspective. Improvements to EnerGov's reports are needed so that case file data and metrics can help better inform management decision-making. But although requests for these improvements have been entered, they aren't moving to completion for one reason or another. It should be noted that, along with other priority projects, there were two large scale information technology projects implemented or ongoing du ring the course of the year when the IT department would have been addressing the service requests listed above. Undoubtedly, this greatly impacted resources. tf Ci of Item #8 C~ss'jcf Exhibit 1 Also during the course of the audit, Community Development managers coordinated w ith their different divisions and the IT Department to implement a streamlined process by which priorities are determined and communicated. Taking these steps has greatly improved communication and is ensuring that all stakeholders are present at least during the-department's prioritization process. Recommendation 3: To evaluate the performance of its code enforcement officers and to maximize the use of code enforcement data residing in EnerGov, the Code Enforcement Division must identify and monitor key metrics. Once specific metrics are identified, code enforcement staff should coordinate with the IT Department to determine how to best extract this information from EnerGov. If EnerGov is unable to support this activity the city should prioritize the identification {or procurement) of a software application that can. The list below offers a sample of key metrics the code enforcement program could use to monitor the performance of staff, to identify trends of non-compliance, and assign staff to achieve the greatest impact, among other potential benefits. Key metrics • Total cases by all groups • Total cases by all subgroups • Cases opened by code officer • Cases closed by code officer • Reinspections completed by code officer • Courtesy notices issued by code officer • Notices of violation by code officer • Administrative citations issued by code officer • Certificates of non-compliance issued • Stop work notices by officer While there are numerous data points already entered in EnerGov by code enforcement staff, new data points may need to be added to enable the tracking of key metrics. If this is the case, this will require close coordination between the IT Department and code enforcement staff. There are other potential software solutions than EnerGov. The city has the use of Tableau, a business intelligence application that is well-suited for pulling data together from multiple sources and providing detailed reports. There also is a system known as GoGov, which appears to have considerable upside in terms of the efficiency in how code cases could be managed and in the suite of standard reports that are available. Recommendation 4: In the context of the EnerGov enterprise system, it's recommended that the IT and Community Development Departments coordinate a recurring meeting {bi- monthly, monthly, etc.) that brings together all divisions within Community Development to discuss and prioritize ServiceNow requests that originated during the period with IT representatives. Such a meeting will also serve as an opportunity for IT staff to openly discuss with the requestor, and management, any requests that require referral to Tyler Assist. Tyler-Assist is a third-party contractor that consult s with the city regarding the Ma oah 21, J6i1(;\,de Eofoccemeo< Pmgca m Asdit if' Citvof Item #8 clttsBrld7 Exhibit 1 functionality of EnerGov. If Tyler-Assist is unable to find a solution, then IT staff should discuss remaining options with the party that originated the service request. The goal of this process is to ensure such requests are activity worked until resolved or until all options are exhausted. A secondary goal is to ensure all parties receive the same information and stay on the same page, throughout the process SUMMARY OF RECOMMENDATIONS Recommendation 1: The Code Enforcement Division should immediately begin the implementation of a code enforcement procedure manual to serve as both a training and operations resource for staff. Existing policies and procedures, such as those established by the city's municipal code and the Case Prioritization and Process Guide provide the foundation for the code enforcement program and the framework within which staff operate. While there are other topical procedure documents available, they do not provide the breadth of information and deta ii necessary to serve as a resource or to support code enforcement operations. Management response: The Community Development Department concurs with this recommendation and anticipates that a day-to-day operations guide will be developed and implemented within the next 12 months. Recommendation 2: Management should Identify a code enforcement officer t o serve as a training coordinator for the division. Identifying such a role will help ensure the code enforcement officers continue to maintain their uniform approach to addressing complaints and serving the city's residents. The uniformity will result in part from having a single point of contact for training and from the implementation of a code enforcement procedure manual as noted in recommendation #1. Management response: Community Development concurs with this recommendation and anticipates that the Senior Code Enforcement Officer will act as the Code Enforcement Division training coordinator. At the time of the audit, the Senior Code Enforcement Officer position was assisting the Housing & Homeless Services Department while it fills vacancies. This position has since returned to us and we are current ly in the recruitment process. Recommendation 3: To evaluate the performance of its code enforcement officers and to maximize the use of code enforcement data residing in EnerGov the Code Enforcement Division must identify and monitor key metrics. Once specific metrics are identified, code enforcement staff should coordinate with the Information Technology Department to determine how to best extract t his information from EnerGov. If EnerGov is unable to support this activity the city should prioritize the identification or procurement of a software application that can. Management response: Community Development concurs with this recommendation with a modification. The Code Enforcement Case Prioritization and Process Guide currently establishes caseload levels and processing timeline targets, categorized by violation type as reflected in Sections 6 and 7. The case processing tasks that should be used in EnerGov to track whether the Code Enforcement Division staff are meeting the targets are listed in ( Ci!Yof Item #8 Ca1isBftd7 Exhibit 1 Section 10. Therefore, Community Development finds that the key metrics needed to track and manage the processing of casework have already been identified. However, Community Development agrees that there are other metrics outside of case management that would be important information to evaluate, such as number of cases per council district, areas of high concentration of code cases ("hot spots"), and code case types by geographic area. Community Development agrees to develop a list of additional metrics that help track enforcement trends, which could be used to inform the public and help the department develop programs and processes that can address identified issues. Community Development recognizes, and agrees with the Auditor, that EnerGov is not currently structured to track all of the tasks listed in Section 10. Furthermore, while a lot of the data that could be used to track enforcement trends is currently tracked in EnerGov, the system is not configured for the department to easily extract from EnerGov the data to generate reports and maps. Community Development agrees to work with IT to either update EnerGov to modify the system to generate these metrics or to contract with an outside vendor who specializes in code enforcement tracking software (i.e., GoGov). The goal is to ultimately have a tracking system in which weekly case processing reports and maps are automatically generated so management can quickly and easily determine whether processing targets are being met and how resources can be best deployed based on enforcement trends. See response to Recommendation 4, below, for completion timeline. Recommendation 4: The auditor recommends that the IT and Community Development Departments coordinate a recurring meeting (bi-monthly, monthly, etc.) that brings together all divisions within Community Development to discuss and prioritize Service Now requests that originated during the period related to the EnerGov system. Such a meeting will also serve as an opportunity for IT staff to openly discuss with the requestor, and management, any requests that require referral to Tyler-Assist. Tyler-Assist is a third-party contractor that consults with the city regarding the functionality of EnerGov. If Tyler-Assist is unable to find a solution, then IT staff should discuss remaining options with the party that originated the request. The goal of this process is to ensure ServiceNow requests are activity worked on until resolved or until all options are exhausted. A secondary goal is to ensure all parties receive the same information and stay on the same page, throughout the process. Management response: Community Development concurs with this recommendation and will start holding combined recurring meetings with IT on a bi-monthly basis in January 2022. Time lines to complete ServiceNow ticket requests will be dependent upon coordination with Information Technology, given that department's capacity and resource constraints. t.f Ci of Item #8 C~sB~cr s: ClJ ... ,.., ::J" N .!'-l N 0 N N ;::i:" (1) 3 ~ 00 -0 ClJ OQ ro ,... -..J 0 -,... -..J City of Carlsbad Status Update of Open Internal Audit Recommendations Audit Engagement: 2021-01 City Credit Card Program Audit City Council Date: March 22, 2022 No. Recommendation 1 The Finance Department should communicate guidance citywide about the taxability of employee appreciation related items and gifts to ensure that city departments give and report them in compliance with the Internal Revenue Code. 2 To ensure that lodging purchases made during city business-related travel are appropriate, the Finance Department should update its travel guidelines and procedures to adopt either the state or the federal government's annual lodging rates by geographic location, and require employees to submit written justification when rates must exceed these established maximums. Management Response The Finance Department will send an annual citywide email reminding all employees and managers of the Internal Revenue Code, with specific examples to ensure compliance, and setup a process whereby departments report any renumeration to employees. The Finance Department will update the travel guidelines and procedures to include a maximum reimbursement based on the Federal Travel Regulations, which may be overridden with appropriate justification and approval. Departmenf(s) Deadline Status Finance 6/30/2022 In Progress -The Finance Department is evaluating IRS guidance concerning fringe benefits and de minimis treatement of gifts. Once they conclude findings, an annual communication will follow. Finance 6/30/2022 In Progress -The Finance Department is evaluating available lodging rates (e.g. the federal GSA rate) and an update to the city's travel policy. At the conclusion, guidance will be communicated. m >< ::, c-;:;: N Code Enforcement Audit Report & Open Audit Recommendations Status Update Laura Rocha, Deputy City Manager, Administrative Services Robert Threatt, Internal Audit Manager Administrative Services March 22, 2022 PROPOSED ACTION Receive the code enforcement internal audit report and a status update regarding open audit recommendations from an audit of the city’s credit card program. ITEM 8: CODE ENFORCEMENT AUDIT TODAY’S PRESENTATION •Identify audit objectives •Discuss audit methodology •Present audit results, audit recommendations and management’s response to each •Status update regarding open audit recommendations •Questions? ITEM 8: CODE ENFORCEMENT AUDIT CODE ENFORCEMENT PROGRAM AUDIT AUDIT OBJECTIVES •To assess whether the division has reliable policies and procedures to support effective code enforcement. •To evaluate whether a selection of case files from the most recent three-year period adhere to applicable guidelines. •To assess whether the city uses case data and metrics to provide meaningful information to management. ITEM 8: CODE ENFORCEMENT AUDIT AUDIT METHODOLOGY •Interviewed Code Enforcement and IT Department staff •Direct observations •Analyzed code enforcement case file data •Reviewed city policies and procedures •Reviewed new technologies ITEM 8: CODE ENFORCEMENT AUDIT AUDIT RESULTS & FINDINGS Objective 1: To assess whether the division has reliable policies and procedures to support effective code enforcement. •Well supported by the city’s Case Prioritization and Process Guide and Carlsbad Municipal Code •Example: Progressive citation protocols ITEM 8: CODE ENFORCEMENT AUDIT AUDIT RESULTS & FINDINGS Objective 1 continued •Audit Recommendation 1: Implement code enforcement procedure manual to serve as a training resource •Management Response 1: Concurred and anticipates completing within a year ITEM 8: CODE ENFORCEMENT AUDIT AUDIT RESULTS & FINDINGS Objective 2: To evaluate whether a selection of case files from the most recent three-year period adhere to applicable guidelines. •Tested case file data from FY19, FY20 and FY21 which are found in EnerGov, a city enterprise system •Consistent application of guidelines noted ITEM 8: CODE ENFORCEMENT AUDIT AUDIT RESULTS & FINDINGS Objective 2 continued •Audit Recommendation 2: Management should identify a senior code enforcement officer to serve as a training officer to ensure the continuation of excellent standardized service •Management Response 2: Concurs and expects the Senior Code Enforcement Officer to fill this role ITEM 8: CODE ENFORCEMENT AUDIT AUDIT RESULTS & FINDINGS Objective 3: To assess whether the city uses code enforcement case file data and metrics to provide meaningful information to management. •Testing identified several factors impacting the use of data •EnerGov reporting limitations •Multiple priority setting meetings •Limited resources ITEM 8: CODE ENFORCEMENT AUDIT AUDIT RESULTS & FINDINGS Objective 3 continued •Audit Recommendation 3: The division should leverage the existing code enforcement data by identifying and monitoring key metrics, which will allow them to generate value added reports for use by management and other decision-makers. ITEM 8: CODE ENFORCEMENT AUDIT AUDIT RESULTS & FINDINGS Objective 3 continued •Management Response 3: Concurs and indicated they will work with the IT Department to update EnerGov or identify a resource that can deliver the necessary reports. ITEM 8: CODE ENFORCEMENT AUDIT AUDIT RESULTS & FINDINGS Objective 3 continued •Audit Recommendation 4: •IT and Community Development Departments streamline meeting where ServiceNow tickets are reviewed, and priorities set •Ensure all divisions within Community Development are represented ITEM 8: CODE ENFORCEMENT AUDIT AUDIT RESULTS & FINDINGS Objective 3 continued: •Management Response 4: •Concurs with this recommendation and has already established a single recurring meeting to review the groups ServiceNow tickets •All divisions represented to ensure awareness regarding departmental priorities and available resources ITEM 8: CODE ENFORCEMENT AUDIT Open Audit Recommendations City’s Credit Card Program Audit, February 2021 •Taxability of employee appreciation awards (e.g., small gifts and gift cards) •To ensure that lodging purchases made during city business-related travel are appropriate ITEM 8: CODE ENFORCEMENT AUDIT Open Audit Recommendations Taxability of employee appreciation awards (e.g., small gifts and gift cards). •In progress •Completion due by 6/30/2022 •The Finance Department is evaluating IRS guidance concerning the fringe benefits of small gifts. Once they conclude findings, an annual communication will follow. ITEM 8: CODE ENFORCEMENT AUDIT Open Audit Recommendations To ensure that lodging purchases made during city business‐related travel are appropriate •In progress •Completion due by 6/30/2022 •The Finance Department is evaluating the available lodging rates (e.g., federal GSA rate) and an update to the travel policy. ITEM 8: CODE ENFORCEMENT AUDIT Questions? Audit Objectives Audit Procedures Audit Recommendations ITEM 8: CODE ENFORCEMENT AUDIT