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Civic Center Audit <br />November 24, 2015 <br />Page 2 <br />DISCUSSION: <br />On June 16, 2015, the City Council directed that an audit of the Civic Center Project be <br />performed. The goals of the audit are to identify areas that were done correctly, areas <br />that could use improvement, and if applicable, areas where results fell short of <br />expectations. Post construction audits of major projects are standard practice in the <br />public and private sector and ensure that future projects are constantly improving. <br />The City Council assigned our office the task of hiring and working with an independent <br />outside manager to issue an RFQ and prepare a contract with an audit firm. Working <br />under the City Council's direction, our office issued an RFQ, conducted interviews, and <br />entered into a professional services agreement with Allyson M. Gipson of Harris & <br />Associates, Inc. to serve as the independent outside manager. The professional <br />services agreement between the City of Newport Beach (City) and Harris & Associates, <br />Inc. provides for a not to exceed amount of $52,920 for all phases of the audit. <br />Our office assisted Ms. Gipson in issuing an RFQ for an audit firm to conduct the actual <br />audit work on the Civic Center Project. The audit RFQ was issued on September 15, <br />2015, and proposals were due by October 14, 2015. The City received twelve audit <br />proposals from audit firms located throughout the country. Ms. Gipson, with our office's <br />assistance, selected three audit firms for in-person interviews, which were conducted on <br />November 4, 2015. Following the interviews, Ms. Gipson recommends the City enter <br />into the attached professional services agreement with RW Block Consulting, Inc. RW <br />Block Consulting proposes to conduct the audit in two phases; the first phase consists <br />of a general overview of the project and has an anticipated completion date of February <br />29, 2016. The second phase, if needed, involves a more detailed review of certain <br />project areas identified in the first phase as needing more review with an anticipated <br />completion date of July 31, 2016. Ms. Gipson will be in attendance at the City Council <br />meeting and available to answer any questions regarding her approach to the audit <br />and/or her recommendation to proceed with RW Block Consulting, Inc. <br />The original staff report prepared by the City Manager's Office for the Civic Center audit <br />contained an estimated not to exceed budget of $100,000; however, the City Manager <br />recognized $100,000 may not be a feasible dollar amount and provided for the City <br />Council to revise the not to exceed cost based upon the actual proposals submitted by <br />the independent outside manager and audit firm. The actual costs for all audit work is <br />estimated to cost in excess of the original $100,000 estimated budget. The contract <br />with Harris & Associates, Inc. has a not to exceed cost of $52,920 and the audit work <br />proposed by RW Block Consulting, Inc. has an estimated not to exceed cost of <br />$110,000 for phase one of the audit, and a not to exceed cost of $450,000 for the <br />second phase of the audit. The total estimated not to exceed cost for all phases of the <br />audit is $612,920, which includes the work performed by Harris & Associates, Inc. and <br />27-2 <br />