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Received After Agenda Printed <br />January 13, 2015 <br />Item No. SS3 <br />January 11, 2015 <br />PLEASE DISTRIBUTE TO CITY COUNCIL MEMBERS AND ENTER INTO THE <br />PUBLIC RECORD- reference January 13, 2014 City Council session <br />Subject: Final Accounting Closeout and Lessons Learned re: Construction of Newport <br />Beach City Hall /Civic center and, Request to City Council for Improved Fiscal Controls <br />Mayor and Council Members: <br />We appreciate the direction of Mayor Pro -tem Dixon to staff to provide a report detailing <br />the final Closeout Accounting for the construction of the new City Hall at the upcoming <br />January Council meeting, and comments regarding "lessons learned ", presumed to <br />include opportunities for improvement going forward. We are pleased that this <br />opportunity is being provided. Residents have been waiting for over 18 months for <br />answers to questions posed at the May, 2013 Council meeting during which City staff <br />first presented a request to Council for an additional $6 million to "complete the closeout <br />accounting" on this project. $4.3 million was to be used for what was characterized as <br />"design omissions ", nor was a fully detailed schedule provided to consider the merits <br />and amounts. Residents expressed desire for further explanation and information, also <br />including understanding of the role ,actions and accountability of the third party CM at <br />risk . Residents submitted oral and written testimony, and asked that the Council not <br />approve the request until such time as the requested supporting information was <br />provided; particularly as there were potential issues of both cost and risk(safety and <br />claims - related) associated with 'omissions ". The Council proceeded to unanimously and <br />without condition or request for additional information, approve the extra funds. <br />We have reviewed the Staff Reports throughout the course of this project, and including <br />those prepared in preparation for the January 13, 2015 Study Session. Following are <br />our key concerns which we request that the Council consider and affirmatively address <br />in its direction going forward. <br />Capital programs represent one of the three largest areas of financial expenditure and <br />commitment of the City. The City cannot provide true Fiscal Control and accountability <br />until its approach to capital programs is addressed. Therefore, it is critical that the City <br />and its leadership: 1)ldentify specific points of concern relating to policy and practice <br />associated with capital program planning and management, and 2) Establish specific <br />policy direction, procedures, commitments to fiscal budget discipline, contractual and <br />project management controls, and 3) maintain clear roles and accountability going <br />forward . <br />