Audit of City Council Committee Spending and Employee Administration

The Office of Inspector General (OIG) conducted an audit of City Council committee spending and employee administration. Council committees review proposed legislation within their defined subject matter areas and vote on whether to recommend its passage by the full Council, hold hearings (both on specific ordinances and on more general topics related to municipal governance), and process some administrative matters via legislation, such as permits for sidewalk cafés and business awnings. Each committee has its own budget in the City’s annual appropriations ordinance.The objectives of the audit were to determine whether Council committees:comply with Municipal Code of Chicago (MCC) § 2-8-071 regarding employee recordkeeping; andcomply with the City’s annual appropriations ordinance regarding committee expenditures and use of committee staff.Some City Council committees have not maintained complete employee records in accord with the records retention requirements of MCC § 2-8-071 and the Illinois Local Records Act, 50 ILCS 205/1, et seq. In addition, some committee personnel perform non-committee duties, notwithstanding state and municipal requirements that governments spend appropriated funds only for their designated purposes. Regarding committee spending, while OIG identified 29 committee non-personnel expenditures for non-committee purposes between January 2015 and July 2019, Council and the Department of Finance have since implemented improved operational and review processes to effectively mitigate the risk of such payments.OIG requested 16 months of employee attendance records, randomly selected from June 2015 through March 2020, from the five City Council committees with the largest budgets. While the five committees provided employee records for the current legislative term, only one provided complete records for the previous term. The remaining four committees included three with no employee attendance records for 13 of the 16 months and one with no records for 9 months and only partial records for 4 months. All four of these committees use paper-based employee attendance records. The current chairs were unable to provide the majority of the records OIG requested because they were kept by previous committee chairs and not transferred when the current chairs took over in 2019. The failure to maintain these records constitutes noncompliance with both MCC § 2-8-071 and the Illinois Local Records Act, which requires municipalities to maintain records and to destroy them only after approval by the Local Records Act Commission. The fifth committee, which provided complete records, uses the City’s electronic time and attendance system.In addition, from the total of 13 committees OIG reviewed, 7 City Council committee chairs directed or allowed committee employees to work on non-committee matters, including tasks related to the chairs’ wards. This practice constitutes noncompliance with the state and municipal requirements that governmental entities expend appropriated funds only for their designated purposes. It also results in the diversion of resources appropriated to serve Council as a whole and may create inequalities between wards by effectively giving some aldermen disproportionally more resources for their non-committee work.Lastly, OIG identified 29 non-personnel committee expenditures totaling $35,895 made for non-committee purposes. However, by July 2019, City Council and the Department of Finance had improved operational and review processes to effectively mitigate the risk of such impermissible payments.