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[00:00:02]

MY NAME IS

[CALL TO ORDER]

ALISON ALTER AND I CHAIR THE AUDIT AND FINANCE COMMITTEE.

IT IS 9:35 AM.

AND I'M GOING TO CALL THIS MEETING TO ORDER I'M JOINED ON THE VIRTUAL DYESS BY COUNCIL MEMBERS, TOVO POOL KELLY AND MAYOR ADLER.

UM, WE ARE WAITING, UM, TWO OTHER COLLEAGUES TO JOIN US FOR THE MEETING, BUT WE'RE GOING TO GO AHEAD AND TAKE A LOOK AT THE

[1. Approve the minutes of the Audit and Finance Committee Meeting of March 31, 2021 and April 13, 2021.]

MINUTES.

UM, WE HAVE TWO SEPARATE MINUTES AND I'LL ENTERTAIN A MOTION TO APPROVE THE MINUTES FROM MARCH 31ST AND APRIL 13TH, MOVED BY COUNCIL MEMBER KELLY AND SECONDED BY COUNCIL MEMBER POOL.

AND I HAVE A QUESTION.

GO AHEAD, COUNCIL MEMBER POOL.

I WANTED TO CHECK WITH, UM, OUR CITY AUDITOR, IF THE MINUTES FROM OUR LAST MEETING, UM, INCLUDED THE BACKUP FROM, UM, THEY, UM, FROM ACE INC.

I THINK THAT, AND THEN ALSO, I THINK WE GOT SOME LIGHT BACKUP FROM THEM FOR THIS MEETING, BUT CAN WE BE SURE TO INCLUDE THOSE DOCUMENTS IN BOTH, UH, LAST MONTHS, LESS MEETINGS MINUTES, AND THEN ALSO THIS MEETING.

THANKS.

WE CAN HEAR YOU COREY.

OKAY, WELL, UM, MAKE SURE THAT THEY'RE REFERENCED IN THE MINUTES AND THEN I INCLUDE THEM IN THE BACKUP FOR THE MEETING THAT WORKS.

THANK YOU.

UM, SO ALL THOSE IN FAVOR OF APPROVING THE MINUTES, YOUR OUT OR YOUR FAVOR, I ASSUME.

UM, OKAY.

THAT IS UNANIMOUS ON THE DIASPORA PROVING BOTH OF THOSE SETS OF MINUTES, UM, WITH COUNCIL MEMBER POOL'S REQUEST NOTED.

UM, SO LOOKS LIKE WE HAVE DIANA THOMAS FOR OUR NEXT ONE OF OUR NEXT SESSIONS.

GOOD MORNING.

WE'RE JUST WAITING TO SEE A COUPLE OF THEIR COUNCIL MEMBERS WANTED TO JOIN US AND WE ARE, UM, TRYING TO GET THEM ON LINE HERE.

I'M SORRY, WHAT? JUST WANT TO MAKE SURE THAT THE REST OF THE TEAM THAT'S DOING THE PRESENTATION ARE ALSO BEING ADDED, SHOULD BE INTERIM CONTROLLER, MARIA, YOU KITSCH AND REAM SAMARA FROM DELOITTE, LIKE ROGERS FROM DELOITTE.

I'M MAKING SURE THAT I SEE THEM COMING UP NOW.

CTM, HOW ARE WE DOING ON MAYOR PRO TEM WHEN IT COMES TO MEMBER FRONT DESK SENT THEM BOTH THE LINK.

SO WE JUST NEED TO WAIT AND SEE IF THEY'RE ABLE TO LOG IN.

OKAY.

SO WE'LL TAKE UP THE DELOITTE ITEM FIRST.

IS THAT RIGHT? YEAH.

YES.

UM, SO WE ARE GOING TO GO OUT OF ORDER, UM, FROM WHAT IS ON THE AGENDA.

OKAY.

OKAY.

SORRY.

I'M GETTING TEXTS ABOUT THIS MEETING SOMEWHERE ELSE HERE.

OKAY.

MAYOR PRO TEM.

HASN'T RECEIVED IT.

I'LL GO AHEAD AND SEND IT AS WELL.

OKAY.

SO TWO FOR FIRST.

YEAH.

YEAH.

OKAY.

SO, UM, I THINK WE WILL GO AHEAD AND START AND UM, HOPEFULLY CTM CAN GET, UM, OKAY.

SO, UM, AS I WAS SAYING, WE ARE GOING TO GO A LITTLE BIT OUT OF ORDER, UM, SO THAT WE CAN HAVE OUR EXTERNAL AUDIT, UM, GO FIRST.

SO ESSENTIALLY WE'RE GOING TO TAKE THE BRIEFINGS FIRST.

UM, WE'RE GOING TO, YOU KNOW, AUDIT ITEM FOUR, THEN WE'RE GOING TO TAKE THAT SMB AR UM, WHICH IS ITEM FIVE, UM, BECAUSE WE HAVE POSTPONED THEM MULTIPLE TIMES AND THEN WE WILL TAKE UP THE RELATED TO ACE AND THEN WE WILL TAKE UP THE CONVENTION CENTER, FINANCIAL QUESTIONS, ITEM SEVEN, AND THE STORM AUDIT WILL THEN HAPPEN IN FUTURE ITEMS. AND I APOLOGIZE FOR, UM, THE DISCOMBOBULATION, BUT OUR EXTERNAL AUDITORS.

WE WANTED TO MAKE SURE WE COULD GET THEM, UM, IN FIRST.

AND SO AS LONG AS WE WERE JIGGERING, EVERYTHING, WE

[00:05:01]

DECIDED TO DIG IT ALL.

SO, UM, THANK YOU VERY MUCH.

AND I WILL, UM, JUST NOTE FOR STAFF, UM, AS OF LAST NIGHT THERE WAS A BUNCH OF BACKUP ON PRESENTATIONS THAT WAS NOT LOADED UP.

UM, SO IF YOU HAVE NOT ALREADY DONE SO THIS MORNING, IF YOU COULD PLEASE MAKE SURE THAT THAT BACKUP GETS UP FOR TRANSPARENCY PURPOSES, UM, AND JUST FOR THE RECORD COMES TO NUMBER FOUR, THIS IS WATCHING ON ATX AND I THINK SHE DID JUST GET THE LINK THOUGH.

[4. The Fiscal Year 2020 Comprehensive Annual Financial Report by Deloitte & Touche LLP, the City's external auditor (Financial Services Department)]

SO, UM, DIANA THOMAS, ARE YOU THE ONE WHO'S KICKING US OFF FOR THIS PRESENTATION? I WILL.

THANK YOU VERY MUCH.

COUNCIL MEMBERS.

UH, I'M DIANA THOMAS.

I'M THE INTERIM DEPUTY CHIEF FINANCIAL OFFICER.

AND I'M GOING TO INTRODUCE MARIA.

YOU COULD CHOOSE THE INTERIM CONTROLLER TO LEAD PRESENTATION.

THANK YOU ALL.

UM, CAN WE BRING UP THE PRESENTATION OR GREAT, THANK YOU.

GOOD MORNING, MAYOR AND COUNCIL MEMBERS.

I AM MARIA.

YOU COULD ENTER IN CITY CONTROLLER.

I AM HERE WITH DREAM SUMMER FROM DELOITTE AND TOUCHE, LLP.

THE CITY'S EXTERNAL AUDITOR TO PRESENT THE RESULTS OF THE FISCAL YEAR 2020 PENSIVE ANNUAL FINANCIAL REPORT OR THE REPORT AUDIT YOU'LL RECEIVE YOUR BOND COPIES OF THE REPORTS DISCUSSED TODAY.

AS SOON AS WE CAN GET THEM PRINTED, CAN WE ADVANCE TO THE NEXT SLIDE PLEASE? THE CITY'S REPORT WAS ISSUED IN MARCH 19TH, 2021.

WE'RE REQUIRED TO ISSUE BY MARCH 31ST.

SO WE ARE PLEASED THAT WE WERE ABLE TO ISSUE EARLY.

THE REPORT IS AVAILABLE ONLINE AT AUSTIN FINANCE ONLINE.

THE WEB ADDRESS IS LISTED BELOW THE PICTURE OF THE COVER 2020 MARK AUSTIN ENERGY'S HUNDRED AND 25TH YEAR AS THE CITY OF BOSTON'S COMMUNITY OWNED PUBLIC UTILITY.

AND THIS YEAR'S REPORT CELEBRATES THIS MILESTONE.

THIS YEAR'S, THIS YEAR'S REPORT AND AUDIT ARE THE FIRST ONES THAT WE HAVE COMPLETED A HUNDRED PERCENT VIRTUALLY.

SO WE'RE VERY PROUD OF THAT.

THE CONTROLLER'S OFFICE IS RESPONSIBLE FOR THE PREPARATION OF THE CITY'S REPORT.

OUR OFFICE WORKS CLOSELY WITH THE LAWYER TO OBTAIN AN INDEPENDENT AUDIT OF THIS REPORT.

IF WE CAN ADVANCE THE NEXT SLIDE, PLEASE LISTED ON THIS SLIDE ARE THE REQUIREMENTS FOR AN ANNUAL AUDIT AND THE CITY HAS IN COMPLIANCE WITH EACH OF THESE REQUIREMENTS.

WE HAVE OUR INDEPENDENT AUDITOR, THE LAWYER AND TOUCHE LLP.

THEY'RE AN INDEPENDENT CERTIFIED PUBLIC ACCOUNTING FIRM.

AND THIS IS THE THIRD YEAR OF A FIVE-YEAR CONTRACT FOR AUDIT SERVICES.

THE REPORT WAS ISSUED WITHIN SIX MONTHS OF FISCAL YEAR END.

THE REPORT WAS PUBLISHED ON MARCH 19TH, 2021.

WE ARE REQUIRED TO PRESENT WITHIN 60 DAYS OF ISSUANCE.

THE LLOYD IS HERE TODAY ON APRIL 28TH, 2021, WHICH IS 40 DAYS AFTER ISSUANCE OF THE REPORT.

IF WE CAN MOVE ON TO THE NEXT SLIDE, PLEASE, I WOULD LIKE TO THANK THOSE LISTED ON THIS SLIDE FOR THEIR CONTRIBUTIONS TO THE COMPLETION OF THIS KEY FINANCIAL REPORT, INCLUDING THE MAYOR AND COUNCIL CITY MANAGEMENT AND THE CITY'S FINANCIAL STAFF FOR ALL OF THEIR WORK IN GETTING THIS REPORT COMPLETED.

UH, SO IF WE CAN ADVANCE THE NEXT SLIDE, PLEASE, NEXT WE HAVE THE DELOITTE PRESENTATION AND BREAM SUMMER WITH DELOITTE WILL NOW TAKE OVER.

WE WILL OPEN IT UP FOR QUESTIONS AT THE END OF THIS PRESENTATION.

SO IF WE CAN MOVE ON TO THE NEXT SLIDE, THAT SHOULD BE A, YEAH, THAT ONE.

THANK YOU, REINDEER.

STILL ON MUTE.

OKAY.

THANK YOU, MARIA.

GOOD MORNING.

GOOD MORNING, COUNCIL MEMBERS AND MAYOR.

AND, UH, THANK YOU FOR THE OPPORTUNITY TO PRESENT OUR YEAR AND RESULTS OF THE AUDITS TO TOGETHER.

UH, WITH ME ON THIS CALL OR BLAKE ROGERS, HE IS A PARTNER IN OUR AUDIT PRACTICE AND JANE SHEN SHE'S A SENIOR MANAGER.

UH, BLAKE WAS IN CHARGE OF OUR COMPLIANCE WORK, THE SINGLE AUDIT THAT WE PERFORMED FOR THE CITY AND JANE WAS A SENIOR MANAGER IN CHARGE OF THE AUDIT.

UH, YOU COULD, UH, MOVE TO THE NEXT SLIDE PLEASE.

UH, WE ARE HERE TO REPORT THAT WE HAVE COMPLETED OUR FINANCIAL STATEMENT AUDIT OF THE COMPREHENSIVE ANNUAL FINANCIAL REPORT FOR THE CITY.

AND OUR AUDITOR'S OPINION IS INCLUDED IN THE FINANCIAL SECTION OF THE FINANCIAL STATEMENTS THAT YOU SHOULD HAVE RECEIVED IN YOUR PACKET OUT AUDIT WAS PERFORMED IN ACCORDANCE WITH GENERALLY ACCEPTED AUDITING STANDARDS AND GOVERNMENT AUDITING STANDARDS.

WE'RE REQUIRED TO FOLLOW THE GOVERNMENT AUDITING STANDARDS BECAUSE YOU RECEIVE FEDERAL AND STATE FINANCIAL, UM, GRANTS.

UM, AND AWARDS, AS MARIA MENTIONED, OUR AUDITOR'S OPINION WAS ISSUED ON MARCH 19TH, 2021.

AS YOU ALL KNOW, THIS WAS A BIG YEAR, LIKE MARIA SAID THAT, UH, WE HAVE PERFORMED COMPLETED THE AUDIT COMPLETELY VIRTUAL.

WE REALLY WANT TO THANK

[00:10:01]

THE COOPERATION OF DIANA AND MARIA AND THE WHOLE TEAM IN THE CONTROLLER'S OFFICE AND TOGETHER WITH EVERYONE WITHIN ALL THE DEPARTMENTS.

SO THIS WAS A CHALLENGE THAT, UH, EVERYBODY HAS MET.

WE HAVE RECEIVED THEIR FULL COOPERATION THROUGHOUT THIS ENGAGEMENT, UM, AND RECEIVED, UM, YOU KNOW, YOU KNOW, DURING THE MIDDLE OF THE AUDIT, UH, AND IN ADDITION TO THE PANDEMIC AND DEALING WITH CARE, ZACK FUNDING AND THE ISSUES AROUND THE ACCOUNTING AND COMPLIANCE RELATED TO THOSE, WE ALSO, UH, YOU KNOW, FACE THE STORM THAT THAT CAME INTO IT AND, UH, THE MIDDLE OF THE AUDITS, BUT W UM, MANAGEMENT AND STAFF WERE EXTREMELY HELPFUL IN HELPING US COMPLETE THIS AUDITS ON TIME AND BE ABLE TO SHOW OUR AUDITORS OPINION IF YOU CAN MOVE TO THE NEXT SLIDE, PLEASE.

UM, AS I MENTIONED, THE AUDIT WAS PERFORMED IN ACCORDANCE WITH GENERALLY ACCEPTED AUDITING STANDARDS.

AND OUR OPINION IS UNMODIFIED, MEANING THAT THE FINANCIAL STATEMENTS THAT WERE PRESENTED BY MANAGEMENT DUTY PRESENT THE FINANCIAL POSITION OF THE CITY OF AUSTIN.

THIS WAS BASICALLY THE BEST RESULTS THAT YOU WOULD WANT TO HEAR FROM THE INDEPENDENT AUDITOR.

ONE THING TO NOTE IS THAT THERE ARE CERTAIN COMPONENT UNITS THAT ARE PRESENTED IN THE FINANCIAL STATEMENTS.

THOSE COMPONENT UNITS THAT ARE DISCREETLY PRESENTED WERE AUDITED BY OTHER AUDITORS, AND OUR OPINION BASICALLY REFERENCES THE OTHER AUDITOR'S OPINIONS.

IN ADDITION TO THE FINANCIAL INFORMATION, THAT'S INCLUDED IN THE FINANCIAL STATEMENTS THAT ARE SUBJECT OF INITIAL AUDIT, THERE ARE OTHER REQUIRED SUPPLEMENTARY INFORMATION INCLUDED, AND THAT BASICALLY IS THE MANAGEMENT DISCUSSION AND ANALYSIS, AND ALSO CERTAIN SCHEDULES THAT ARE REQUIRED FOR THE PENSION AND OPEC PLANS.

THOSE, UH, SCHEDULES AND THE MDS WERE BASICALLY NOT SUBJECTED TO THE AUDIT ITSELF, BUT WE READ THOSE AS REQUIRED BY OUR AUDITING STANDARDS AND TO DETERMINE THAT THEY WERE PROPERLY PRESENTED AND PREPARED IN ACCORDANCE WITH THE GOVERNMENT ACCOUNTING STANDARD SPORTS REQUIREMENTS.

WE DIDN'T HAVE ANY ISSUES WITH THAT PRESENTATION.

IN ADDITION, THERE ARE CERTAIN, UH, COMBINING SCHEDULES THAT ARE INCLUDED AS OTHER SUPPLEMENTARY INFORMATION IN THE FINANCIAL STATEMENTS.

THAT INFORMATION WAS AUDITED IN RELATION TO THE FINANCIAL STATEMENTS AS A WHOLE, AND WERE FOUND TO BE CONSISTENTLY PRESENTED IN ACCORDANCE WITH GAP.

THE OTHER INFORMATION IN THE CAFFER SUCH AS THE INTRODUCTORY SECTION AND THE STATISTICAL SECTION ARE NOT AUDITED, BUT ARE REQUIRED TO BE PRESENTED BY MANAGEMENT, UH, FOR, UH, TOP THING, THE GFI CERTIFICATES, OUR RESPONSIBILITIES AS AUDITORS', UH, WERE INCLUDED IN OUR ENGAGEMENT LETTERS, UH, WE'VE UH, INCLUDED ALSO, UM, UH, UH, A SUMMARY OF THOSE RESPONSIBILITIES IN APPENDIX A, OF THIS PRESENTATION.

I'LL BE HAPPY TO ANSWER QUESTIONS, BUT I WAS NOT GOING TO GO OVER THOSE SUPER DETAILED OUR RESPONSIBILITIES AT THIS POINT.

UH, COULD YOU MOVE TO THE NEXT SLIDE PLEASE? WHEN THE MANAGEMENT PREPARES FINANCIAL STATEMENTS, UH, THEY ADOPT ACCOUNTING POLICIES.

UM, THIS YEAR THERE WERE NO CHANGES IN ACCOUNTING POLICIES.

GATSBY IN FACT, HAS, UM, DELAYED THE IMPLEMENTATION OF SIGNIFICANT ACCOUNTING STANDARDS AS A RESULT OF THE PANDEMIC.

SO THERE WERE NO NEW ACCOUNTING STANDARDS THAT WERE ADOPTED OR ANY CHANGES IN ACCOUNTING POLICIES.

ALSO THE PREPARATION OF FINANCIAL STATEMENTS ENTAILS, UM, MANAGEMENT TO MAKE A CERTAIN ACCOUNTING ESTIMATES.

AND SO WE'VE DISCLOSED ON THIS SLIDE HERE, UM, THE MAJOR ACCOUNTING ESTIMATES OR THE SIGNIFICANT ONES, AND WE HAVE SUMMARIZED AND APPENDIX B, UH, BASICALLY IN THE, OF THIS REPORT AND HOW WE'VE ADDRESSED THOSE ESTIMATES, BUT, UH, ANY LIABILITIES RELATED TO PENSION, OPEB ASSETS, RETIREMENT OBLIGATIONS, AND THEN THE DIFFERENT AMOUNTS FOR REGULATED OPERATIONS ARE CONSIDERED ACCOUNTING ESTIMATES.

UH, MANAGEMENT HAS CONSISTENTLY APPLIED THE POLICIES AND METHODS OF CALCULATING THOSE ESTIMATES AND, UH, WE FOUND THEM TO BE PROPERLY PRESENTED IN ACCORDANCE WITH GENERALLY ACCEPTED ACCOUNTING PRINCIPLES.

NEXT SLIDE, PLEASE.

I'M GOING TO TURN IT ON TO JANE TO GO OVER, UH, THE SUMMARY OF UNCORRECTED, THE SAME AS THAT WERE NOTED DURING THE AUDITS AND THOSE THAT WERE CORRECTED GOOD MORNING, EVERYBODY.

UM, SO DURING THE COURSE OF OUR AUDIT, WE IDENTIFIED A FEW MISSTATEMENTS AND WE WANTED TO REMIND YOU THAT OUR AUDIT IS DESIGNED TO OBTAIN REASONABLE AND NOT ABSOLUTE ASSURANCE THAT THE FINANCIAL STATEMENTS ARE NOT MATERIALLY MISSTATED.

AND WE LIKE TO THINK ABOUT THE MISSTATEMENTS IN TWO CATEGORIES, UNCORRECTED AND CORRECTED UNCORRECTED MISSTATEMENTS ARE THOSE THAT WE, AND BOTH WE AND MANAGEMENT AGREED THAT THESE ARE NOT MATERIAL TO THE FINANCIAL STATEMENTS, AND THEREFORE THEY'RE NOT CORRECTED OR REFLECTED IN THE FINANCIAL STATEMENTS THAT WERE ISSUED.

YOU CAN FIND A FULL LIST

[00:15:01]

OF THESE UNCORRECTED MISSTATEMENTS IN APPENDIX C PRACTICE.

THE STATEMENTS ON THE OTHER HAND ARE THOSE THAT WE IDENTIFIED AND THE MANAGEMENT AGREED TO CORRECT THEM.

SO THESE ARE INCORPORATED INTO THE FINANCIAL STATEMENTS THAT HAVE BEEN ISSUED AND MANAGEMENT DOES THIS BY WAY OF WHAT'S CALLED JOURNAL ENTRIES.

AND YOU CAN SEE HERE BELOW THAT THERE ARE FOUR JOURNAL ENTRIES THAT WE WANTED TO BRING TO YOUR ATTENTION.

THE FIRST ENTRY WAS IN THE AIRPORT FUND.

THE AIRPORT HAD ENTERED INTO AN AGREEMENT WHERE THE COUNTERPARTY WOULD LEASE LAND AT THE AIRPORT AND THEN CONSTRUCT VARIOUS BUILDINGS AND HANGERS.

ON TOP OF THAT LAND, THE CONTRACT WAS INTERPRETED SUCH THAT THE CONSTRUCTED ASSETS WITH THESE SESSIONS ESSENTIALLY DONATED TO THE AIRPORT ONCE CONSTRUCTION COMPLETED AND THEREFORE AIRPORT RECORDED CAPITAL CONTRIBUTIONS REVENUES, AND THEN REFLECTED THOSE ASSETS AS THEIR OWN.

HOWEVER, THE SOLE USE OF THOSE ASSETS REMAINED WITH THE COUNTERPARTY FOR 30 YEARS.

AND THEREFORE WE DETERMINED THAT THE CITY DOES NOT ACTUALLY CONTROL THOSE ASSETS AND REQUESTED THE ENTRY BE REVERSED.

THE SECOND ENTRY WAS THE, UM, IN THE WATER FUND.

SO THERE WAS, UH, SORRY, WAS THERE SOMEBODY WHO WANTED, OKAY, SORRY, I'LL GO WITH MY PROBLEM WITH MY MIC.

UM, THE SECOND ENTRY THAT YOU SEE ON YOUR SCREEN IS A WITH THE AUSTIN WATER FUND, THERE WAS A LARGE PROJECT WITH THE TEXAS DEPARTMENT OF TRANSPORTATION THAT REQUIRED AUSTIN WATER TO, UM, TAKE A WHOPPING $23.8 MILLION DEPOSIT.

AND THE DEPOSIT WAS ORIGINALLY CLASSIFIED AS A CONSTRUCTION IN PROGRESS.

BUT SEEING AS THE PROJECT HADN'T ACTUALLY BEGUN, WE'D REQUESTED THAT IT BE CLASSIFIED AS AN OTHER ASSET.

INSTEAD, THE THIRD AND FOURTH ENTRIES SHOWN, UM, WERE RELATED TO THE SPECIAL REVENUE FUNDS, WHICH ARE PART OF THE NON-MAJOR GOVERNMENTAL FUNDS.

THE THIRD ENTRY SHOWN HERE IS TO CORRECT THE PRESENTATION OF VARIOUS INTERFUND REIMBURSEMENTS AND TRANSFERS BETWEEN, UM, THE SAME SPECIAL REVENUE FUNDS.

SO THIS RESULTED IN A DECREASE OF REVENUES AND EXPENSES OF $54 MILLION AND INCREASES IN TRANSFERS OUT AND TRANSFERS IN BY, UH, $48 MILLION.

THE FOURTH ENTRY SHOWN HERE IS ALSO FRACTION OF A PRESENTATION ITEM.

LAND THAT IS HELD FOR SALE WAS PRESENTED AS AN EXPENSE RATHER THAN A CURRENT ASSET IN THE FUND FINANCIAL STATEMENTS.

SO HONESTLY IT CAN HAPPEN BECAUSE WITHIN A GOVERNMENTAL FUND PLAN THAT IS NOT HELD FOR SALE.

SO LAND THAT YOU CONTINUE TO USE IS CLASSIFIED AS AN EXPENSE ON THE FRONT FUND FINANCIAL STATEMENTS.

UM, SO, BUT, BUT IN THIS CASE IT WAS HELD FOR SALE.

AND SO THIS RECLASSIFICATION ESSENTIALLY RE UH, RESULTED IN A DECREASE IN EXPENSES AND INCREASE IN LAND, HELD FOR SALE FOR $10.3 MILLION.

SO I KNOW GAVE YOU A LOT OF DETAIL THERE.

ARE THERE ANY QUESTIONS? ALL RIGHT.

I THINK WE'LL, UH, WE'LL FINISH THE WHOLE PRESENTATION AND THEN WE'LL OPEN IT UP FOR QUESTIONS.

THANK YOU.

ALL RIGHT.

SO IF YOU'D LIKE TO, UM, CONTINUE TO NEXT SLIDE, PLEASE.

SO WE ALSO WANTED TO HIGHLIGHT, BUT WE HAD NO DISAGREEMENTS WITH MANAGEMENT, DIANA MARIA AND HER TEAM ARE JUST SOME OF THE SMARTEST FAMILIES, PEOPLE THAT WE WORK WITH.

SO THEY MAKE IT EASY FOR US.

UM, AND WE CAN TELL THAT THEY WANT TO DO THE RIGHT THING DURING THE YEAR.

THEY HOLIDAY, UM, DISCUSSION WITH THE GOVERNMENTAL ACCOUNTING STANDARDS BOARD OR GATSBY, AND ON THE TREATMENT OF HER PAYMENTS TO BE MADE TO ONE OF ITS DISCRETELY PRESENTED COMPONENT UNITS.

AND AS YOU CAN SEE ON THIS SLIDE, WE ENCOUNTERED NO DIFFICULTIES DURING THE AUDIT.

WE RECEIVED THE FULL COOPERATION OF MANAGEMENT AND STAFF AND HAD UNRESTRICTED ACCESS TO THE CITY, SENIOR MANAGEMENT.

AND WE ALSO WANTED TO COMMEND DIANA MARIA AND THEIR TEAM FOR SO SEAMLESSLY TRANSITIONING, UH, WITH US TO A REMOTE WORKING ENVIRONMENT.

THEY WERE ALREADY FAMILIAR WITH SOME OF OUR, UM, YOU KNOW, INNOVATIVE COLLABORATION TOOLS, BUT THEY REALLY HELPED WITH THE TRANSITION BY MANAGING BEING SO AGILE AND COORDINATING ALL THESE MEETINGS, UM, OVER TEAMS AND JUST BEING VERY, VERY, UM, YOU KNOW, FORWARD THINKING AND HELPING US TRANSITION.

SO IT WAS DEFINITELY A CHALLENGING YEAR FOR ALL OF US WITH THE PANDEMIC AND THE ICE STORMS, BUT WE ALL GOT THROUGH IT SUCCESSFULLY TO BE ABLE TO PRESENT TO YOU HERE TODAY.

UM, AND SO WITH THAT, UM, WE ALSO WANTED TO LET YOU KNOW THAT MANAGEMENT IS REQUIRED TO MAKE CERTAIN REPRESENTATIONS TO US AS THERE AS, UM, YOUR AUDITORS.

YOU CAN FIND A COPY OF THOSE REPRESENTATIONS IN APPENDIX C AND FINALLY CONSISTENT WITH LAST YEAR, WE USE MONTEMAYOR BRITAIN AND BENDER AS A STAR, AS OUR SUBCONTRACTOR AUDITING FIRM TO COMPLETE OUR AUDIT.

SO WITH THAT, I'LL HAND IT BACK TO REIGN, UM, TO DISCUSS EACH TIME.

UM, SO IF WE CAN MOVE ON TO THE NEXT SLIDE, PLEASE.

UH, ONE THING TO NOTE, UH, COUNCIL MEMBERS IS THAT DURING THE AUDIT, WE OBTAIN AN UNDERSTANDING OF YOUR INTERNAL CONTROLS AND TEST THE DESIGN AND IMPLEMENTATION OF THOSE CONTROLS.

UH, WE DO NOT TEST THE OPERATING EFFECTIVENESS OF INTERNAL CONTROLS.

HOWEVER, IF WE IDENTIFY ANY WEAKNESSES THAT ARE CONSIDERED TO BE SIGNIFICANT DEFICIENCIES OR MATERIAL WEAKNESSES, WE ARE REQUIRED TO BRING THOSE, UM, RECOMMENDATIONS AND ISSUES TO YOUR ATTENTION.

[00:20:01]

WE HAVE ISSUED A SEPARATE REPORT ON INTERNAL CONTROLS THAT IS INCLUDED.

UM, I, I'M NOT SURE DIANA IF THAT WAS INCLUDED IN A SEPARATE PACKET OR IN THIS PACKET, BUT WILL BE PROVIDED AS PART OF THE SINGLE AUDIT ALSO AT, UH, AT THE END OF THE SINGLE AUDIT.

BUT IN THAT SEPARATE REPORT ON CONTROLS, WE HAVE IDENTIFIED ONE SIGNIFICANT DEFICIENCY, UH, THAT WE'RE REQUIRED TO BRING TO YOUR ATTENTION.

AND THE OTHER DEFICIENCY ACTUALLY RELATES TO THE ADJUSTING ENTRIES THAT JANE JUST MENTIONED.

IF YOU NOTICED THAT WHERE THERE WERE FOUR SIGNIFICANT ADJUSTING ENTRIES THAT WERE IDENTIFIED DURING THE AUDIT, ALL THOSE ENTRIES, WE FELT THAT HAD ONE, ONE THING IN COMMON, WHICH IS COMMUNICATION OR COORDINATION WITH THE DEPARTMENTS WHEN THEY DEAL WITH UNIQUE, UM, TRANSACTIONS.

SO IF A DEPARTMENT IS DEALING WITH A UNIQUE TRANSACTION, THEY ARE REQUIRED TO IDENTIFY, UM, BASICALLY THE PROPER ACCOUNTING AND REPORTING OF THOSE TRANSACTIONS.

AND IF THOSE TRANSACTIONS ARE NOT TIMELY COMMUNICATED WITH THE FINANCE OFFICE OR THE CONTROLLER'S OFFICE, THERE'S A RISK THAT THOSE TRANSACTIONS WILL NOT BE PROPERLY ACCOUNTED FOR ON THE RECORD.

SO WE MADE THE RECOMMENDATION OF, UH, BETTER TRAINING FOR THE DEPARTMENTS TO TIMELY COMMUNICATE WITH THE CONTROLLER'S OFFICE, AND ALSO TO PROBABLY AT THE, AT THE END OF THE YEAR TO, UH, PREPARE SOME SORTA ANALYTICAL REVIEW TO COMPARE CURRENT YEAR TRANSACTIONS TO PRIOR TRANSACTIONS.

BECAUSE WHEN YOU DO THAT, SOMETIMES YOU IDENTIFY, UM, YOU KNOW, UM, CHANGES THAT WOULD RAISE QUESTIONS THAT WOULD LEAD FOR YOU TO, UM, IDENTIFY THOSE TRANSACTIONS AND PROPERLY RECORD THEM TIMELY.

SO BASICALLY, UH, WE ARE RECOMMENDING A PREVENTATIVE CONTROL IF YOU WILL, WHICH IS FAMILY COMMUNICATION, AND THEN A DETECTIVE CONTROL THAT YEAR AND FOR SOMEBODY TO DO THOSE COMPARISONS, UM, THAT'S, UH, THE DETAIL OF, UH, THE ACTUAL, UH, FINDING AND RECOMMENDATION ARE INCLUDED IN APPENDIX D AND MANAGEMENT'S RESPONSE IS ALSO INCLUDED IN THAT APPENDIX TOO.

UM, SO I WAS JUST GOING TO STOP THERE AND SEE IF MANAGEMENT WANTED TO, UM, RESPOND TO ANYTHING RELATED TO THE FINDING.

I KNOW THAT YOU HAVE INCLUDED YOUR RECOMMENDATION OR YOUR CORRECTIVE ACTION AND THE RECOMMENDATION, RIGHT.

UM, SO MEMBERS OF THE COMMITTEE, I WANTED TO LET YOU KNOW THAT MANAGEMENT HAS CONCUR, UH, CONCURRED WITH, UH, DELORES RECOMMENDATION.

UH, THE CONTROLLER'S OFFICE IS GOING TO BE SCHEDULING, UH, REGULAR MEETINGS WITH KEY DEPARTMENTS TO MAKE SURE THAT WE'RE STAYING APPRISED OF ANY DEVELOPMENTS, UM, AND ANY NEW TRANSACTIONS THAT MIGHT BE UNIQUE OR UNUSUAL FOR, UM, THEIR DEPARTMENT.

THAT WAY WE CAN, UM, MAKE SURE THAT WE'RE APPLYING THE APPROPRIATE ACCOUNTING TREATMENT GOING FORWARD.

THANK YOU, MARIA.

UM, THE DEFINITION OF SIGNIFICANT DEFICIENCY OR MATERIAL WEAKNESS ARE ALSO INCLUDED IN APPENDIX D FOR YOUR REFERENCE.

UM, THERE, I WANTED TO ALSO HIGHLIGHT THREE OTHER REPORTS THAT WILL BE ISSUED OR HAVE BEEN ISSUED AT THIS POINT.

UH, THE SINGLE AUDIT REPORT IS IN PROGRESS.

AND, UM, I WILL, UH, GIVE BLAKE AT THE END A COUPLE OF MINUTES TO KIND OF GIVE YOU AN UPDATE OF WHERE WE ARE ON THAT ONE.

AND WE HAVE ALSO ISSUED OUR REPORT ON THE PASSENGER FACILITY CHARGES.

THESE ARE THE CHARGES THAT ARE RECEIVED BY THE AIRPORT.

UH, THERE ARE COMPLIANCE REQUIREMENTS THAT THE CITY IS REQUIRED TO COMPLY ON THE SPENDING OF THOSE, UH, CHARGES.

UH, WE COMPLETED THAT AUDIT ISSUED THE REPORT ACTUALLY LAST WEEK AND THE AUDIT WAS CLEAN, MEANING THAT WE FOUND OUT THAT THE CITY COMPLIED WITH ALL THE REQUIREMENTS RELATED TO THE PASSENGER FACILITY CHARGES.

UM, IN ADDITION, THERE'S ANOTHER AGREED-UPON PROCEDURES REPORT, UH, THAT THE CITY IS REQUIRED TO FILE WITH THE TEXAS COMMISSION ON ENVIRONMENTAL QUALITY.

UH, THAT'S REPORT HAS BEEN COMPLETED ALSO WITH NO FINDING.

SO WITH THAT, I'M GOING TO TURN IT TO BLAKE TO JUST GIVE US AN UPDATE ON THE SINGLE AUDIT.

GOOD MORNING, BLAKE ROGERS, LOU DELAY.

CAN YOU HEAR ME NOW? YES.

OKAY, EXCELLENT.

THANK YOU.

SO LIKE I'M ON A CELL PHONE COMMERCIAL, UH, APOLOGIES.

UH, WE ARE IN THE PROGRESS OF COMPLETING OUR SINGLE AUDIT AT THIS POINT.

WE HOPE TO BRING THAT TO THIS COMMITTEE AND OUR NEXT MEETING RIGHT NOW.

UH, WE ARE AUDITING NINE PROGRAMS, FIVE FEDERAL PROGRAMS, AND FOUR STATE PROGRAMS, UH, NOT SURPRISING THAT THIS IS A LARGE YEAR FOR COMPLIANCE AUDITS AS THE CITY RECEIVED SIGNIFICANT FUNDING AS A RESULT OF THE CORONAVIRUS AID RELIEF AND ECONOMIC SECURITY ACT OR THE CARES ACT, WHICH MAKES UP A BULK OF THE FUNDS THAT WE WILL BE AUDITING AND COMPLETING OUR WORK ON AND HOPING TO PRESENT TO YOU NEXT MONTH.

THANK YOU,

[00:25:01]

BLAKE.

UM, THIS CONCLUDES OUR PART OF THE PRESENTATION.

WE WILL BE HAPPY TO ANSWER ANY QUESTIONS YOU WANT TO HAVE.

THANK YOU.

I APPRECIATE, UM, THE PRESENTATION.

I JUST WANTED TO CLARIFY ONE THING BEFORE WE GO TO QUESTIONS.

SO QUESTIONS AND CONCERNS THAT WE MIGHT HAVE, YOU KNOW, TO MAKE SURE THAT WE WERE HANDLING, UM, THAT WOULD, THAT INFORMATION WILL COME TO US IN THE SINGLE AUDIT, WHICH WE WILL HEAR IN MAY.

IS THAT CORRECT? OKAY.

THAT'S CORRECT.

GREAT.

THANK YOU.

COUNCIL MEMBER POOL LOOKS LIKE YOU HAD YOUR HAND UP.

OKAY.

THANKS CHAIR.

ALTAR.

I WANTED TO JUST ASK STAFF, UM, MAYBE MS. THOMAS TOO, UM, GIVEN THE UNIQUE NATURE OF THOSE CONTRACTS THAT WERE FOUND TO HAVE SOME EXCEPTIONS ON HOW THEY WERE, UM, UH, JOURNALED.

AND I DON'T KNOW IF I'M USING THE TERM RIGHT, BUT COULD YOU CHECK THE OTHER CONTRACTS THAT WE HAVE THAT ARE UNIQUE, THAT ARE ALONG THE SAME LINES AND WHAT, WHAT TRIGGERED IT FOR ME WAS HOW WE ARE COUNTING THE LAND THAT WE OWN IT AT, UH, UM, THE CALLA PLACE, BECAUSE IT HAS A NEW USE.

AND I WANT TO MAKE SURE THAT WE'RE TRACKING HOW THAT'S ASSIGNED APPROPRIATELY IN LIGHT OF THE FINDINGS FROM THE AUDIT, UH, IN THE CAFE OF COURSE, COUNCIL MEMBER, ANNA THOMAS, INTERIM, DEPUTY CHIEF FINANCIAL OFFICER, UH, JUST REALLY QUICKLY WHEN WE SEE TRANSACTIONS THAT ARE UNIQUE, UM, LIKE THE MCCALLA PLACE TRANSACTION, WE SIT DOWN WITH THOSE DEPARTMENTS THAT ARE INVOLVED IN THAT TRANSACTION AND WE GET ALL THE INFORMATION THAT WE CAN FROM THEM, INCLUDING ALL CONTRACTS AND AGREEMENTS.

AND THEN WE GO BACK AND LOOK AT THE ACCOUNTING STANDARDS TO MAKE SURE THAT WE'RE APPROPRIATELY, THAT WE'RE APPROPRIATELY REFLECTING THOSE TRANSACTIONS IN THE FINANCIALS.

I KNOW THAT WE'VE LOOKED VERY CLOSELY AT MCCOLLOUGH.

IT WAS ALL OVER THE NEWSPAPER.

AND OF COURSE, A BIG CONVERSATION IN, IN, IN CITY, UH, YOU KNOW, AMONGST CITY STAFF ABOUT WHAT ALL WAS GOING ON.

SO WE WANTED TO MAKE SURE THAT WE GOT THAT ONE, RIGHT? SOME OF THE ONES THAT WERE IDENTIFIED HERE ARE, ARE UNIQUE IN A DIFFERENT WAY.

YOU KNOW, A LOT OF TIMES WHEN WE MAKE A PAYMENT TO TXDOT, FOR EXAMPLE, THE WORK HAD STARTED RIGHT AWAY.

AND IT REALLY IS JUST PART OF A CONSTRUCTION PROJECT THAT WE'RE A PART OF.

AND THIS PARTICULAR INSTANCE, THE PROJECT DIDN'T GET STARTED RIGHT AWAY.

IT TOOK A LITTLE BIT LONGER.

AND SO THE MONEY WAS REALLY JUST SITTING WITH TXDOT, UM, YOU KNOW, FOR US TO USE LATER, UH, YOU KNOW, FOR THEM TO USE LATER ON THE PROJECT THAT WE'RE PARTICIPATING IN.

SO I THINK IN THAT CASE, THERE'S A LOT OF THOSE ACTIVITIES, BUT WE ARE FINDING, UM, THAT VERY INNOVATIVE AND CREATIVE ORGANIZATION, AND WE LIKE TO DO A LOT OF NEW AND INNOVATIVE THINGS.

AND SO WE NEED TO MAKE SURE THAT WE'RE INVOLVED IN THOSE CONVERSATIONS SO WE CAN MAKE SURE THAT WE ACCOUNT FOR THEM CORRECTLY.

AND THAT'S REALLY WHAT CAME OUT OF THIS THIS YEAR WAS THAT WE HAD SEVERAL UNIQUE TRANSACTIONS THAT OCCURRED, UM, THAT WE NEED TO DO A BETTER JOB OF REACHING OUT.

NOW WE DO ASK EVERY YEAR IN A SIGNIFICANT, UM, ITEMS, QUESTIONNAIRE THAT WE SEND TO DEPARTMENTS, HAVE YOU DONE ANYTHING UNIQUE AND SPECIAL THIS YEAR SO THAT WE CAN MAKE SURE WE ACCOUNT FOR IT CORRECTLY, BUT THESE JUST, I THINK IN THE MIDST OF EVERYTHING THAT WAS GOING ON, KIND OF FELL BY THE WAYSIDE AND REALLY DIDN'T GET PULLED UP TO OUR ATTENTION LIKE THEY SHOULD.

SO WE'RE GOING TO CREATE SOME MEETINGS THAT WE HAVE WITH KEY DEPARTMENTS WHO HAVE THE TENDENCY TO HAVE MORE OF THESE UNIQUE TRANSACTIONS TO MAKE SURE THAT WE'RE GETTING THAT INFORMATION THAT WE NEED.

THAT'S REALLY GOOD.

THANKS SO MUCH.

THAT SEEMS LIKE THE PROCEDURES, THE PROCESSES THAT WE HAVE IN PLACE ARE ACTUALLY WORKING, INCLUDING THE OVERSIGHT AND THE SCRUTINY AND THE CORRECTIONS WHERE WE FIND THAT WE'VE SORT OF MISSED SOMETHING.

UM, THAT'S GREAT.

THANK YOU SO MUCH.

YOU BET.

ANY OTHER QUESTIONS, COLLEAGUES, THANK YOU TO OUR CONTROLLERS OFFICE AND TO OUR AUDITORS.

UM, YOU KNOW, THIS IS THE AUDIT AND FINANCE COMMITTEE, AND ONE OF OUR RESPONSIBILITIES IS TO HEAR THESE REPORTS ON THE AUDITS AND TO REVIEW, UM, THE MATERIALS.

UM, THIS IS THE FIRST OF, I THINK TWO THAT WE GENERALLY HEAR IN THE SPRING IN MAY, WE WILL HEAR, UM, THE SINGLE AUDIT, WHICH TAKES PARTICULAR PROGRAMS AND DIVES A LITTLE DEEPER INTO OUR COMPLIANCE WITH RESPECT TO, UM, THOSE PROGRAMS. UM, WE HAVE EXCELLENT, UM, FINANCIAL STAFF AND, AND, UH, GOOD FINANCIAL STANDING AND, UM, YOU KNOW, THAT WORK, THAT YOU'RE OUT, UM, YOU KNOW, THAT OUR FINANCE STAFF DOES IS PART OF WHAT HAS HELPED US TO WEATHER THE PANDEMIC.

UM, AND SO I JUST WANT TO PAUSE HERE AND, YOU KNOW, RECOGNIZE AND THANK OUR STAFF, UM, UNDER THE LEADERSHIP OF OUR CHIEF FINANCIAL OFFICER HAD BEEN, YOU KNOW, FOR REALLY, YOU KNOW, AGAIN AND AGAIN, PUTTING US IN A POSITION WHERE WE ARE ABLE TO NAVIGATE, UM, TRICKY WATERS, UM, EFFECTIVELY, UM, YOU KNOW, UM, AN AUDIT DOES OFTEN PROVE THAT THERE ARE SOME THINGS THAT YOU

[00:30:01]

NEED TO, TO FIX, BUT THAT'S WHAT THAT PROCESS IS INVOLVED IN.

THOSE ARE ALL, UM, CORRECTED AND WITH A $4 BILLION BUDGET.

UM, THIS, THESE ARE RELATIVELY, UM, MINOR CORRECTIONS, UM, BUT ONES THAT WE NOTE AND WE CAN, WE CAN LEARN ON LEARN FROM MOVING FORWARD.

UM, MR. YOU, DID YOU WANT TO SAY SOMETHING BEFORE WE CONCLUDE IN HERE WHERE YOU JUST SHOWING YOUR FACE? SO YOU KNEW THAT, UH, UM, I WAS HEARING YOU AND REALLY APPRECIATE ALL THAT HELPED WITH EVERYTHING.

GREAT.

WELL, THANK YOU.

THANK YOU TO, UM, OUR AUDITORS AS WELL.

[5. Update on the MBE/WBE/DBE Disparity Study and MBE/WBE Program (Small and Minority Business Resources Department)]

UM, WE ARE NOW GOING TO MOVE TO ITEM, UM, FIVE, UM, WHICH IS NOT ITEM FIVE IN THE ORDER.

WE'RE DOING IT TODAY, BUT THAT IS THE UPDATE FROM THE MB EWB W E E DISPARITY STUDY AND THE F AND B WBE PROGRAM PRESENTED BY THE SMALL MINORITY BUSINESS RESOURCES DEPARTMENT.

I BELIEVE MR. COMPOST IS ON THE LINE IS WE CAN MOVE HIM OVER.

GOOD MORNING, MR. COMPOSTS, ARE YOU PRESENTING FOR US VR? I AM GOOD MORNING COUNCIL MEMBERS.

I DO HAVE SOME COLLEAGUES HERE THAT SHOULD BE BROUGHT OVER AS WELL.

TAMELA SAW TANYA AND ELTON PRICE.

GREAT.

THANK YOU.

THANK YOU.

SEE ELTON AND I SEE TAMALA TILA.

OKAY.

AND IF WE COULD HAVE CITY HALL BRING UP THE PRESENTATION AND WE DO APPRECIATE YOU BRINGING US BACK TO PRESENT.

SO AS SOON AS THEY HAVE YOUR PRESENTATION UP, YOU CAN PROCEED.

SURE.

SO, UM, THANK YOU FOR HAVING US.

MY NAME IS EDWARD COUPLES.

I AM THE INTERIM DIRECTOR FOR THE SMALLER MINORITY BUSINESS RESOURCES DEPARTMENT.

I'M JOINED TODAY BY DR.

TAMLA.

SALDANIA OUR COMPLIANCE OFFICER, ALSO OUR PROJECT MANAGER FOR OUR DISPARITY STUDY THAT SHE'LL GET TO IN A LITTLE BIT.

AND I'M JOINED BY OUR CERTIFICATION DIVISION MANAGER, ELTON PRICE.

AND WE'LL BE PROVIDING YOU SOME INFORMATION RELATED TO, AS I SAID, THE DISPARITY STUDY, AS WELL AS SOME INFORMATION ON OUR CERTIFICATION NUMBERS AND SOME INITIATIVES THAT WE'RE WORKING ON.

AND AT ANY TIME, PLEASE STOP US.

OR WE CAN TAKE QUESTIONS THAT IF I COULD HAVE CITY HALL, BRING UP QUESTIONS AT THE END.

THANK YOU.

THANK YOU.

IT SOUNDS LIKE, UM, CTM, YOU HAVE YOUR PRESENTATION IS WHAT I'M SEEING, UM, FROM THE FOLKS AT CITY HALL.

OKAY.

WE SENT IT TO THEM SEVERAL TIMES.

I'M NOT SURE CAN THEY MAKE IT SO THAT YOU CAN SHARE YOUR SCREEN THAT AN OPTION THAT IS AN OPTION.

WE ARE LOOKING FOR IT.

WE'RE NOT SEEING ANYTHING ON OUR SIDE.

SO YOU BOTH YOU OR ONE OF YOUR STAFF HAVE THAT, THAT YOU COULD SHARE IT ON YOUR SCREEN.

I'LL BRING IT UP RIGHT NOW.

TECHNOLOGY IS A WONDERFUL THING UNTIL IT'S NOT, UM, SEE TIM, I KNOW THIS WAS, I'M PRETTY SURE THIS ONE WAS IN OUR BACKUP.

IS THAT POSSIBLE FOR YOU TO PULL THAT UP FROM THERE? YES, WE'RE WORKING ON THAT.

THANK YOU.

SO HERE WE GO.

LOOKS PROMISING.

THERE WE GO.

THANK YOU FOR YOUR PATIENCE.

UH, ONCE AGAIN, MY NAME IS EDWARD CAPLESS.

I'M THE INTERIM DIRECTOR.

UH, TODAY WE WILL COMPASS.

IF YOU CAN GO INTO THE SLIDE VIEW, THEN IT'LL MAKE IT BIGGER FOR

[00:35:01]

ALL OF US AT WORK.

UM, IT'S NOT SLIDE VIEW, BUT IT WORKS.

IT'S FINE.

GO AHEAD.

THANK YOU.

SO I'LL MOVE OVER TO OUR COMPLIANCE DIVISION.

TOMMO SALDANIA WILL TAKE THE LEAD ON DISCUSSING ISSUES RELATED TO OUR COMPLIANCE SECTION, AS WELL AS PROVIDING AN OVERVIEW ON WHERE WE ARE AT WITH OUR DISPARITY STUDY TAMLA, SAY A WORD.

HI, I'M TAMELA.

SO BANYA, I AM THE COMPLIANCE OFFICER WITH THE SMALLER MINORITY BUSINESS RESOURCES DEPARTMENT.

I AM EXCITED TO SHARE WITH THE COMMITTEE, UM, SOME OF THE MILESTONES AND WHERE WE ARE WITH OUR DISPARITY STUDY.

UH, WE HAVE BEEN WORKING HARD, UM, WITH OUR DISPARITY STUDY CONSULTANT.

WE HAVE RETAINED COLETTE HOLT AND ASSOCIATES, A NATIONALLY, UH, NATIONAL RENOWNED, UH, DISPARITY CONSULTANT, LEGAL ATTORNEY, UH, WHO IS ASSISTING US THROUGH THIS PARTICULAR PROCESS.

UM, THE DISPARITY STUDY, WE HAVE, UH, SUBMITTED ALL OF OUR CONTRACT DATA TO OUR CONSULTANT, AND I AM PROUD TO SAY THAT WE HAVE REPORTED A 96% RESPONSE RATE FROM FOUR VALIDATION OF OUR CONTRACT DATA BY THE CONTRACTING COMMUNITY.

AND I WILL LET YOU GUYS KNOW THAT THIS IS ALMOST UNHEARD OF.

UH, TYPICALLY, UH, YOU ARE GETTING A RESPONSE RATE AT ABOUT 60%, UH, AND OUR COMMUNITY CONTRACTING COMMUNITY CAME IN WITH 96% WITHOUT ME SENDING ANY THREATENING LETTERS OR, UM, HAVING MULTIPLE REQUESTS OVER AND OVER AGAIN.

SO I'M REALLY, REALLY EXCITED AS A PROJECT MANAGER FOR THAT.

UM, WE DID A SERIES OF STAKEHOLDER MEETINGS.

UM, ONE IN WHICH IS ALSO, UM, SHOULD BE NOTED.

UH, IT IS A LEADING, UM, IN, IN, IN THE INDUSTRY, OUR STAKEHOLDER MEETINGS, UH, WE HAD OVER 600 PARTICIPANTS, UH, FROM A VARIETY OF, UH, GROUPS TO INCLUDE INTERNAL WORKING GROUPS FOR THE CITY, OUR DEPARTMENT STAFF WHO WORK AND HELP US AND ASSIST US ADMINISTER THOSE PROGRAMS, THIS MWB PROGRAM, AS WELL AS THEY CALL THE GROUPS THAT WE WENT OUT TO, TO THE SMALLER MINORITY BUSINESS COMMUNITY CERTIFIED AND UNCERTIFIED, UH, OUR PRIME CONTRACTOR COMMUNITY, BUT ALSO OF COURSE, OUR INDUSTRY PARTNERS TO INCLUDE THE MINORITY CHAMBERS, THE, THE LARGER CHAMBERS, OUR MTAS.

WE ALSO DID A SPECIFIC SESSION WITH OUR MWB ADVISORY GROUP.

OUR STAFF ALSO ENGAGED THE QUALITY OF LIFE, UM, UH, COMMISSIONS AS WELL, TOO.

UM, AND DID, UH, A SERIES OF INTRODUCTION MEETINGS.

UH, WE ALSO DID A STET STAFF SESSION, UH, INTERNAL TO SMER.

AND SO WE HAVE EXTENDED A LARGE AMOUNT OF INPUT ABOUT OUR PROCESSES, ABOUT THE BARRIERS, ABOUT, UM, RECOMMENDATIONS FROM OUR STAKEHOLDERS.

UM, IN JANUARY I ASKED THE CONSULTANT TEAM TO GO BACK AND LOOK AT SOME OF THE TRENDS THAT WERE COMING IN FROM THE QUALITATIVE DATA AND DO A BUSINESS SURVEY, AND THEY HAVE ENGAGED IN THAT BUSINESS SURVEYS WITH THE CONSULTANT, WITH THE CONTRACTOR AND CONSULTANT COMMUNITY.

AND, UM, THAT DID EXTEND SOME OF THE, UH, TIMELINE THAT WE INITIALLY HAD AGREED UPON.

BUT OUR, UM, STAKEHOLDER INPUT SESSIONS, UM, WERE SUBURB.

AND I'M EXCITED TO SAY THAT WE HAD A LARGE GROUP OF INPUT ON A LOT OF INPUT INTO THAT PROCESS.

NEXT SLIDE, PLEASE.

HERE'S JUST AN ANTICIPATED PROJECT LINE.

AS I STATED BEFORE, WE HAVE ALREADY SUBMITTED IN FEBRUARY, UM, BACK IN FEBRUARY OF 2020, THE QUALITATIVE CONTRACT DATA, UM, WE AND MARCH AGAIN, STARTED OUR INTERNAL STAKEHOLDER MEETINGS, WHERE AGAIN, WE WENT IN EDUCATED, UH, THE DEPARTMENTS AND OUR STAKEHOLDERS, UH, INTERNAL, EXTERNAL ABOUT THE DISPARITY STUDY, WHAT IT MEANS LEGALLY, ET CETERA, AND P GOT A SIGNIFICANT AMOUNT OF QUALITATIVE DATA ABOUT THEIR CONCERNS AND THEIR NEEDS.

UM, WE DID SEVERAL, UM, CONSULTANT, UH, CURRENTLY WHERE WE ARE NOW IS THAT OUR CONSULTANT IS DOING THE DATA ANALYSIS OF BOTH THE QUALITATIVE AND QUANTITATIVE DATA.

NOW THIS PORTION, AS YOU CAN IMAGINE, PRODUCE A 450 PAGE DOCUMENT.

AND SO NOW WE'RE KINDA IN A HOLDING PATTERN, UH, AS THEY DEVELOP AND ANALYZE THE DATA AND DEVELOP THE RECOMMENDATIONS, UM, FROM, FROM NOW UNTIL ABOUT APRIL,

[00:40:01]

WHAT WE ARE EXPECTING, UM, BECAUSE WE DID PUSH BACK AND ASKED FOR AN ADDITIONAL QUALITATIVE DATA COMPONENT.

UH, WE ARE NOW EXPECTING THAT THE DATE, UH, DISPARITY STUDY WILL BE FINALIZED IN JULY OF 2021.

UH, AND SO WE HOPE TO COME BACK, UH, TO COUNCIL SOMETIME, SORRY.

OKAY.

MAYBE SOMEBODY CAME IN, UM, WE'RE HOPING TO, UH, COME TO, UH, BEFORE COUNCIL IN THE FALL OR WINTER OF 2021, UM, WITH AN NRCA FOR ADOPTION OF OUR DISPARITY STUDY, NEXT SLIDE.

AND AT THIS POINT, EDWARD WOULD TALK ABOUT THE CITY RESOLUTION AND, UH, COUNCIL RESOLUTION AND WHAT WE'RE DOING AND WORKING TO DO WITH INCLUSIVE PROCUREMENT WORKING GROUP.

THANK YOU, TOM.

SO AS YOU RECALL, IN MARCH OF 2020, COUNCIL DID PASS A RESOLUTION, ASKING THE MANAGER TO PUT TOGETHER AN INCLUSIVE PROCUREMENT WORKING GROUP.

THERE WAS A MEMO THAT WAS SENT OUT IN NOVEMBER OF 2020, UH, IN RESPONSE TO THAT RESOLUTION WHERE WE OUTLINED, UM, THE FOUR AREAS THAT WE WOULD BE LOOKING AT AS PART OF THIS WORKING GROUP CERTIFICATION PRACTICES, BEST PRACTICES IN GENERAL COMMUNICATION AND TRANSPARENCY ISSUES AND OVERALL RESOURCES TO OUR MINORITY AND WOMEN OWNED BUSINESSES.

WE ALSO PUT TOGETHER A LIST OF MEMBERS TO THAT IT, TO THAT WORKING GROUP THAT INCLUDED CITY STAFF, IT INCLUDED, UH, OUR KEY AND BDB STAKEHOLDERS TO INCLUDE THE MINORITY TRADE ALLIANCE MEMBERS, MINORITY CHAMBERS PRIME, AND SUBCONTRACTOR ORGANIZATIONS, AS WELL AS FOLKS IN THE COMMUNITY THAT ARE BUSINESS OWNERS AND ARE VERY WELL VERSED IN THE LOCAL PROGRAM AND UNDERSTAND THE INTRICACIES OF THE PROGRAM.

SO THAT WILL MAKE UP OUR, OUR WORKING GROUP.

WE HOPE TO KICK THIS OFF.

AS SOON AS WE GET THE FINAL VERSION OF THE DISPARITY STUDY, WE'RE LOOKING AND TARGETING AN AUGUST OR SEPTEMBER A START DATE FOR THIS WORKING GROUP, A LOT OF WORK TO BE COMPLETED IN A SHORT AMOUNT OF TIME.

OUR ORDINANCE DOES EXPIRE OR SUNSET IN MARCH OF 2022.

SO WE WOULD LIKE TO HAVE THAT WORK COMPLETED FROM THE WORKING GROUP, AS WELL AS A NEW ORDINANCE, UH, FOR COUNCIL CONSIDERATION, UH, BY MARCH OF THAT DATE, IF THERE ARE ANY ISSUES SURROUNDING THAT TIMEFRAME WE WILL, OF COURSE, COME BACK TO COUNCIL FOR AN EXTENSION.

NEXT SLIDE, PLEASE.

I'M GOING TO TURN THIS OVER NOW TO MR. ELTON PRICE.

HE'S OUR CERTIFICATION DIVISION MANAGER.

NEXT SLIDE PLEASE.

THANK YOU, EDWARD.

UM, GOOD MORNING COUNCIL MEMBERS.

UM, I'M GETTING, MY NAME IS ELTON PRICE.

I WORK AS A CERTIFICATION DIVISION MANAGER FOR A SMALLER MINORITY BUSINESS RESOURCES OFFICE.

AND SO, UH, TALKING SPECIFICALLY ABOUT CERTIFICATION AND THE REQUIREMENTS, FIRST THING, VENDORS WHO ARE APPLYING FOR CERTIFICATION, THEY MUST BE REGISTERED AND OFTEN FINANCE ONLINE AS A BUSINESS FOR PROFIT.

THE CITY OF AUSTIN ONLY CERTIFIES FOR PROFIT BUSINESSES.

AND THESE ARE THE FIVE MAJOR COMPONENTS THAT WE LOOK AT WHEN WE RECEIVED THE CERTIFICATION APPLICATION.

FIRST AND FOREMOST, THE BUSINESS MUST BE SMALL IN ANY, ANY CERTIFICATION STANDARDS THAT RELY ON, UH, SIZE.

UH, WE ADHERE TO THESE, UH, SBA GUIDELINES.

AND SO THAT COULD BE, UH, GROCERY SEATS BASED ON A THREE YEAR AVERAGE, WHICH WILL INCREASE TO A FIVE-YEAR AVERAGE IN JANUARY OF 2022.

AND OF COURSE THE NUMBER OF EMPLOYEES, IF YOU'RE IN ANY WHOLESALE OR SELLING ANY TYPE OF GOODS OR COMMODITIES, UM, AS IT RELATES TO YOUR INDUSTRY, UH, THE APPLICANT MUST, UH, BE IN ONE OF THE SOCIALLY DISADVANTAGED PRESUMED GROUPS.

THE CITY OF AUSTIN DOES NOT, UM, NOT ACCEPT APPLICATIONS.

I THINK ANYONE CAN APPLY FOR THE CITY OF ALL STUDENTS PROGRAM.

UH, BUT THEY MUST ALSO, IF, IF APPLYING AND NOT IN THESE PRESUMED GROUPS, THEY MUST SHOW THAT THEY, UH, THEN BIASED AGAINST, AS IT RELATES TO, UH, SOCIAL AND ECONOMIC DISADVANTAGE AND, UM, AND THE AMERICAN SOCIETY, I WOULD SAY, UM, THE PERSONAL NET WORTH OF ECONOMIC DISADVANTAGE IS DETERMINED BY THE CONSUMER PRICE INDEX OR THE SOUTHWEST.

UH, WE JUST INCREASED IT IN JANUARY AND WENT FROM 1.5, SIX, 5 MILLION TO 1.58, 3 MILLION FOR THE M AND WBE PROGRAM.

DVD PROGRAM IS SET AT 1.3, TWO NOON.

UM, THAT IS A DISADVANTAGED BUSINESS ENTERPRISE AND AIRPORT CONCESSION DISADVANTAGED BUSINESS ENTERPRISE, UH, THAT

[00:45:01]

PARTICULAR CRITERIA, OR WHEN WE'RE REVIEWING THE PERSONAL NETWORK, THERE ARE EXCLUSIONS, UH, THE PERSONAL RESIDENCE OF THE APPLICANT ALONG WITH, UH, THE ASSETS OF THE BUSINESS THAT SEEKING CERTIFICATION IS EXCLUDED.

AND WE ONLY LOOK AT THE APPLE PERIOD.

UH, TEXAS IS A COMMUNITY PROPERTY STATE, BUT THE APPLICANT ONLY NEEDS TO PROVIDE, UH, ASSETS AND LIABILITIES THAT ARE SPECIFICALLY TO THE APPLICANT.

SO AN EXAMPLE WOULD BE IF, YOU KNOW, THERE, THERE, IF IT'S A SHARE, UH, ASSET BASED ON A COMMUNITY PROPERTY, AND THAT IS NOT LISTED, UH, AS FOR AS A A HUNDRED PERCENT, THAT COULD BE LISTED AT 50%, IF THE APPLICANT ACTUALLY IS AN OWNER OF THAT ASSET.

UH, WE ALSO LOOK AT OWNERSHIP MANAGEMENT AND CONTROL.

UH, THE OWNER, THE APPLICANT OWNER MUST HAVE AT LEAST A 51% OWNERSHIP OF THE COMPANY BE INVOLVED IN THE MANAGEMENT AND CONTROL OF THAT.

UM, WE DO NOT CERTIFY, UH, APPLICANTS THAT ONLY INVEST IN BUSINESSES AND NOT INVOLVED IN THE DAY-TO-DAY, UH, BUSINESS PROCESS OR THE DAY-TO-DAY MANAGEMENT OF THAT, UH, MUST HAVE EXPERIENCED DIRECTLY RELATED TO THE FIELD THAT THEY'RE SEEKING CERTIFICATION.

UH, IT IS VERY IMPORTANT THAT, UH, PART OF THE EXPERTISE THAT GOES INTO, UH, VERIFYING THAT THE OWNER, UM, QUALIFIES FOR THE PROGRAM IS THAT THEY HAVE THAT DIRECT EXPERIENCE, NOT JUST MANAGEMENT OF THE COMPANY OR THE PERSON THEY ARE.

IT HAS TO BE A PART OF A PART OF THE RESUME, THE SITE AUDIT WE CAN, UH, CONTRACTS.

WE LOOK AT, WE LOOK AT A LOT OF DIFFERENT THINGS TO VERIFY THAT THE QUALIFIED APPLICANTS HE IS INVOLVED IN THE DAY TO DAY OPERATION AND CONTROLS THAT BUSINESS.

SO NEXT SLIDE PLEASE.

SO AS OF JANUARY SIX OF 2020, THE CITY OF AUSTIN, UH, MOVED TO A CERTIFICATION AND COMPLIANCE SYSTEM.

WE PROPERLY CALL THAT CCS NOW, BUT IT IS THE, UH, THE, UH, CITY OF AUSTIN WAS ONLINE APPLICATION FOR THEM.

AND SINCE THE, UH, LAUNCH OR THE ONLINE APPLICATION FOR, UH, THESE ORDER NUMBERS THAT, UH, RELATES TO THE NUMBER OF APPLICATIONS APPROVED FOR THEM.

NOW, THE NUMBER OF APPLICATIONS IS APPROVED FOR THE M AND WB PROGRAM.

AND THE DBE, THE BD PROGRAM IS IT MAY BE A LITTLE BIT DIFFERENT BECAUSE WE CAN STILL ACCEPT, UH, BD APPLICATIONS, UH, THROUGH PAPER BECAUSE THE FEDERAL REGULATIONS, YOU KNOW, THEY DON'T, UM, ALLOW, OR DON'T ALLOW US TO STRICTLY, UH, HAVE DB APPLICANTS OR ACDB APP.

WE CAN SUBMIT THROUGH AN ONLINE PORTAL.

SO THESE ARE THE NUMBER THAT RELATES TO THE NUMBER OF FIRMS THAT HAVE A NUMBER OF APPLICANTS THAT HAVE SUBMITTED ONLINE SINCE THE INCEPTION OF THE, UH, ONLINE APPLICATION CCS.

AND THESE ARE THE NUMBER, THE TOTAL NUMBER OF APPLICATIONS APPROVED BY STAFF SINCE JANUARY OF 2020.

AND THIS IS THE APPROVAL.

SO ALL OF THESE ARE, WERE NOT NEW APPLICATIONS.

THESE WERE APPLICATIONS THAT WERE BD ANNUAL REVIEWS, FOR EXAMPLE, CERTIFICATION, AND ALSO INCLUDED NEW APPLICANTS AS WELL.

NEXT SLIDE PLEASE.

AND SO I WANTED TO, UH, THIS PARTICULAR SLIDE, I WANTED TO GIVE US A SNAPSHOT OF A PAPER COMPARE TO THE ONLINE PORTAL.

UH, WE LOOKED AT, UH, THE PAPER APPLICATIONS FROM JANUARY ALSO 2019 TILL THE END OF THE YEAR.

AND WE ALSO MADE THAT, YOU KNOW, THE COMPARISON TO THE ONLINE PROCESS AND THESE NUMBERS REFLECT, UH, THE INCREASE IN THE NUMBER OF APPLICATIONS RECEIVED VIA THE ONLINE PORTAL, UH, SINCE ITS INCEPTION, UM, IN JANUARY OF 2020.

AND SO, AS YOU CAN SEE THE NUMBER OF APPLICATIONS, STAFF AS HANDLED THROUGH THEIR ONLINE FOR THE INCREASED DRASTICALLY ALSO, UH, WE ARE, UH, ALSO THE, THE NUMBER OF DENIALS ALSO.

UM, WE ARE LOOKING AT, UM, A WAY TO RIGHT NOW, TO, UH, FOLKS, TO RECERTIFY AN ANNUAL REVIEW.

WE SEND THEM 60 DAY NOTICES PRIOR

[00:50:01]

TO THEIR ANNIVERSARY FINISHES.

AND SO WE'RE LOOKING AT AN ADDITIONAL STEP TO TRY TO RETAIN FOLKS BECAUSE MOST OF THE FOLKS YOU SEE DECERTIFIED THE 71 NUMBER ARE BASED ON FOLKS WHO ARE NOT RECERTIFY WITH THOSE FOUR DAYS.

YOU KNOW, THEY MAY HAVE WITHDRAWN OR SOLD A BUSINESS OR SOMETHING OF THAT NATURE, BUT FOR THE FIRMS THAT ARE NOT JUST WITH US AND ARE GIVING US THE DOCUMENTS, UM, TO THEM TO CONTINUE THEIR ELIGIBILITY, WE'RE LOOKING AT AN ADDITIONAL STEP OF NOT ONLY THE 60 DAY NOTICE, BUT ALSO CONTACTING THEM AT 30 DAYS VIA PHONE CALL, EMAIL TO SEE IF WE CAN GET THOSE BOATS TO CONTINUE IN THE PROGRAM.

AND IF NOT, UH, FINDING OUT THE REASON THAT THEY DECIDED NOT TO CONTINUE PROGRAMS. SO, UH, THOSE ARE THE NUMBERS AS OF, UH, WE PULLED THESE NUMBERS AS OF THE END OF MARCH.

AND SO, UH, AGAIN, I'LL BE AVAILABLE IF YOU HAVE ANY QUESTIONS.

UH, AND NEXT SLIDE, PLEASE.

AND WE'LL TALK A LITTLE BIT ABOUT SOME STRATEGIC INITIATIVES.

THANK YOU, ELTON.

I APPRECIATE YOUR COMMENTS ON THE CERTIFICATION NUMBERS.

NEXT SLIDE PLEASE.

SO WE HAVE BEEN WORKING ON A COMPLIANCE MODULE, AS ELTON MENTIONED, UH, AND, AND TABLA MENTIONED AS WELL, UH, LOTS OF WORK STILL TO CONTINUE.

THIS COMPLIANCE MODULE WILL HELP US MOVE AWAY FROM SOMETHING THAT IS VERY PAPER-DRIVEN.

UH, MAJORITY OF OUR PROCESSES ARE PAPER DRIVEN, AND WE'RE TRYING TO WORK WITH, UH, OUR INTERNAL SYSTEMS, UH, OUT OF THE FINANCIAL SERVICES DEPARTMENT TO TRY TO GET THESE, UH, AS ONLINE SUBMISSIONS, THINGS LIKE OUR REQUESTS FOR CHANGE.

WHENEVER THERE'S A CHANGE TO A CONTRACT IN WHICH THERE IS A MINORITY OR WOMAN OWNED BUSINESS INVOLVED, THIS PROCESS, WE HOPE WILL BE CHANGED TO AN ELECTRONIC PROCESS, UH, THE SAME FOR CONTRACT CLOSEOUTS, AND AS WELL AS, UH, WHAT WE CALL SUB-K OR PARTICIPANT SUBCONTRACTOR PARTICIPATION FORMS. WE GET THOUSANDS OF THOSE A YEAR, UH, BETWEEN 3000 TO 5,000.

THOSE ARE ALL PAPER, UH, PROCESSED, WHICH THEN MY STAFF HAS TO GO IN AND MANUALLY ENTER THOSE INDIVIDUAL, UM, FORMS. AND SO IF WE CAN MAKE THIS A ONLINE SUBMISSION THAT WOULD CUT DOWN ON, ON STAFF TIME, UH, AND MOVING THEM TO OTHER, UH, UH, OTHER AREAS THAT WE NEED TO CONCENTRATE ON.

NEXT SLIDE, PLEASE.

WELL, SOME OF THE SUPPORTIVE SERVICES PARTNERSHIPS THAT WE'VE BEEN WORKING ON, AND ONE OF THE ONES THAT I'M REALLY PROUD OF AND EXCITED TO LAUNCH, AND WE'LL BE LAUNCHING THIS IN THE NEXT COUPLE OF WEEKS.

THERE'S AN ONLINE EDUCATION PORTAL FOR OUR CERTIFIED VENDORS.

SOME OF THE THINGS WE'VE HEARD IS THERE'S STILL A LACK OF EDUCATIONAL OPPORTUNITIES FOR OUR CERTIFIED MINORITY AND WOMEN OWNED BUSINESSES.

SO WE ARE GOING TO BE LAUNCHING A PARTNERSHIP WITH A FIRM CALLED GARBOLOGY WHERE OUR CERTIFIED VENDORS WILL BE ABLE TO LOG IN TO WEBSITE AND FIND HUNDREDS OF ONLINE WEBINARS ON HOW TO DO BUSINESS WITH LOCAL GOVERNMENT STATE GOVERNMENT AND THE FEDERAL GOVERNMENT.

AND WE FEEL THAT THIS WILL AGAIN, ALLOW OUR FIRMS TO GET MORE EDUCATION ON HOW TO DO BUSINESS WITH NOT ONLY THE CITY OF AUSTIN, BUT OTHER ENTITIES AS WELL.

THESE ARE AGAIN, TAILORED TO OUR MBE, WBE AND DBE FIRMS, UM, GOVERNMENT PROCUREMENT TRAINING.

AND WE JUST FEEL THAT THIS IS GOING TO GIVE THEM AN OVERALL BETTER STANDING, UH, AS THEY DO AND PROGRESS IN THEIR BUSINESS.

AND AGAIN, GROWING CAPACITY FOR OUR MINORITY FIRMS. NEXT SLIDE, PLEASE, WE'VE ALSO ENGAGED SOME CUSTOMER SERVICE, UH, SURVEYS.

UH, WE'VE HEARD THAT, UM, SMER TENDS TO BE A LITTLE DOGMATIC IN THEIR APPROACH.

AND SO WE WANT TO MAKE SURE THAT WE ARE HEARING FROM OUR CUSTOMERS, BOTH INTERNAL AND EXTERNAL.

SO WE'VE LAUNCHED A SERIES OF CUSTOMER SURVEYS.

I BELIEVE YOU'VE HEARD MR. PRICE MENTIONED US REACHING OUT TO THOSE CERTIFIED VENDORS THAT ARE NO LONGER WITH THE PROGRAM.

WE WANT TO RETAIN ALL OF OUR VENDORS.

AND IF THERE'S A WAY THAT WE CAN WORK WITH THOSE VENDORS THAT HAVE CHOSEN NOT TO REAPPLY FOR CERTIFICATION TO BRING THEM BACK INTO OUR CERTIFICATION ROLES.

UH, OUR, OUR SURVEY IS ONE WAY TO DO THAT AS WELL.

SO WE ARE INCREASING OUR OUTREACH AND FOCUS TO OUR, OUR CUSTOMER BASE.

NEXT SLIDE, PLEASE.

THAT CONCLUDES OUR, OUR PRESENTATION.

UH, WE ARE READY TO, UM, ADDRESS ANY QUESTIONS YOU MAY HAVE.

THANK YOU.

UM, AND IF WE CAN REMOVE THE PRESENTATION SO I CAN SEE FOLKS THAT WOULD BE GREAT.

UM, COLLEAGUES, ARE THERE ANY QUESTIONS, MAYOR

[00:55:01]

ADLER? I JUST WANT TO SAY THAT I REALLY APPRECIATE THIS PRESENTATION AND THE, AND THE OUTLINE AND THE BREADTH OF THE WORK THAT'S BEING DONE.

UH, WE HAD A LOT OF CALLS FROM, UH, FOLKS, UH, AROUND THE CITY THAT HAD GOTTEN USED TO THE REGULARS COUNCIL COMMITTEE THAT WAS DOING REGULAR, UH, INTERACTIONS WITH, UH, WITH THE DEPARTMENT AND, AND, AND, AND FOLKS THAT FELT LIKE THEY WERE BETTER UP TO SPEED WITH WHAT WAS HAPPENING AND HAVING THE ABILITY TO BE ABLE TO COMMENT.

UH, SO I APPRECIATE, UH, CHAIR YOU, UH, PUTTING THIS ON THE AGENDA SO THAT, UH, UH, WE COULD GET THIS OUT, OBVIOUSLY, A LOT OF WORK BEING DONE, A LOT OF PROGRESS BEING MADE, UH, AND IT GIVES, UH, ME NOW SOMETHING THAT I CAN CIRCULATE AND SEND TO THE FOLKS THAT, UH, FEEL LIKE THEY'RE NOT BEING ENGAGED ENOUGH SO THAT THEY CAN KIND OF RAISE ISSUES.

SO I JUST APPRECIATE THE EFFORT.

AND WHEN WE, UM, UH, MOVED AWAY FROM THAT STANDING COMMITTEE, WE HAD TALKED ABOUT HAVING, UH, SOME MEASURE OF REGULAR BRIEFING QUARTERLY OR SOMETHING THAT WOULD KEEP TRACK OF THE ACTIVITY AND THEN THE STATUS.

AND, AND I JUST APPRECIATE THIS BEING PUT ON THE AGENDA.

THANK YOU.

THANK YOU, MIRA ADLER.

UM, ARE THERE ANY OTHER QUESTIONS I HAVE TWO QUICK ONES, IF I MIGHT, UM, ABOUT CERTIFICATION MORE BROADLY WHILE YOU'RE HERE.

UM, WE HAD TALKED, I FEEL LIKE AT ONE OF OUR LAST BRIEFINGS, PERHAPS, OR PERHAPS IT WAS AN INDIVIDUAL MEETING ABOUT ALTERNATIVES THAT WE COULD PURSUE, UM, THAT WOULD ALLOW ADDITIONAL BUSINESSES TO BECOME CERTIFIED, FOR INSTANCE, ADOPTING, ALLOWING IF YOU WERE STATE CERTIFIED FOR ALLOWING YOU TO QUALIFY AT THE CITY LEVEL, UM, I'M CURIOUS WHAT THE STATUS OF THOSE ARE AND HOW WE'RE PURSUING THOSE ALTERNATIVES.

AND THEN I ALSO WANTED TO KNOW WHAT THE POSSIBILITY OF AN LGBT PLUS CERTIFICATION IN THE CITY.

SURE.

SO I'LL TAKE THOSE AND I'LL DEFER TO MR. PRICE.

UH, WE DO ALWAYS CONSTANTLY LOOK AT WAYS THAT WE CAN HAVE SOME RECIPROCITY WITH AGENCIES THAT ARE CLOSELY ALIGNED TO THE REQUIREMENTS THAT THE CITY OF AUSTIN HAS IN TERMS OF CERTIFICATION.

UH, AT THIS POINT, UM, COUNCIL MEMBER, WE HAVEN'T FOUND A, AN ENTITY THAT IS AS RIGOROUS AS WE ARE IN, IN TERMS OF WHAT WE LOOK AT.

I THINK MR. PRICE HAD AN EXCELLENT JOB OF COVERING, UH, AND A HIGH LEVEL.

SOME OF THE FIVE AREAS THAT WE LOOK AT, UH, CERTAINLY THAT SOMETHING THAT MAKES US UNIQUE, UH, IN THE STATE OF TEXAS IS THE FACT THAT WE DO AS A, AS A MUNICIPALITY, HAVE A PERSONAL NET WORTH LIMIT, UH, OTHERWISE KNOWN AS AN ECONOMIC DISADVANTAGE, UH, DEFINITION OR STATUS.

AND SO THAT IS SOMETHING THAT OTHER ENTITIES SIMPLY DO NOT HAVE, UH, AND AS PART OF THEIR LOCAL ORDINANCE, UH, WHAT WE DO HAVE THOUGH IS WHEN WE HAVE A FIRM THAT COMES TO US FOR CERTIFICATION, THAT WE KNOW MEETS THE HUB REQUIREMENTS, WE DO SEND THEM OVER, UH, AND, AND, AND LET THE, UM, THE HUB DIRECTOR KNOW THAT THEY ARE ELIGIBLE FOR HUB CERTIFICATION.

SO WE DO HAVE A RECIPROCITY AGREEMENT, UH, WITH THE STATE HEALTH PROGRAM, UH, BUT IT COMES FROM US TO THEM, NOT THEM TO US.

AND WE ARE CURRENTLY WORKING WITH, UH, MS. CANNON, UH, WITH THE LGBT CHAMBER, UH, AND THE, UH, PURCHASING OFFICE OUT OF THE FINANCIAL SERVICES DEPARTMENT TO CAPTURE DATASETS.

UM, IN ORDER FOR US TO IN, UH, IN THE FUTURE, UH, INCLUDE LGBT COMPANIES AS PART OF A DISPARITY STUDY, AS YOU KNOW, TO MAKE ANY SORT OF CHANGE IN, IN TERMS OF INCLUSION FOR OUR LOCAL ORDINANCE, WE HAVE TO HAVE, UH, DATA.

AND SO THAT IS OUR FIRST ATTEMPT TO TRY TO COLLECT THAT DATA.

UM, AND SO WE HAVE HAD TWO MEETINGS SO FAR WITH MS. CANNON AND THE PURCHASING OFFICE, AND, UH, MORE TO COME ON THAT, UH, IN YOUR STEP.

THANKS.

YEAH, I LOOK FORWARD TO, ARE YOU ABOUT THAT? UM, IF THERE ARE NO MAYOR ADLER, DID YOU WANT TO, WE CAN'T HEAR YOU MAY, ARE YOU ON MUTE? THANK YOU.

UH, MR. CAMPO, SO THAT I UNDERSTOOD THE QUESTION ABOUT WHY WE DON'T USE THE, THE TEXAS HUBS STANDARD IS BECAUSE OUR, UH, QUALIFICATION STANDARDS ARE STRICTER, UH, WITH RESPECT TO, UH, UH, THAT WORTH, UH, FILTER.

IS THAT CORRECT? MR. MERRITT? WE, THEY DO NOT HAVE A, AN ECONOMIC DISADVANTAGE, UH, DEFINITION OR, OR TEST IF YOU WILL.

AND THAT WOULD, THAT WOULD THEN TRANSLATE TO OUR PERSONAL NET WORTH REQUIREMENT.

YEAH.

THANK YOU.

THANK YOU.

I WONDER IF THERE'S A WAY TO DO THE HUB AND THEN REQUIRE THEM TO DO THAT PARTICULAR TEST RATHER THAN GO THROUGH THE WHOLE OTHER PROCESS, BUT I'M SURE YOU WILL.

AND I BELIEVE THAT, UM, THERE IS A SENATE BILL MAKING ITS WAY THROUGH THE

[01:00:01]

PROCESS, UH, CURRENTLY THAT IS REQUESTING A PERSONAL NET WORTH LIMIT FOR THE HUB PROGRAM.

OKAY.

SO THAT MIGHT MAKE IT MIKE, IT MAKE IT EASIER.

THANK YOU ALL FOR PRESENTING.

AND I APPRECIATE YOUR PATIENCE IN IT, TAKING US A LITTLE WHILE, AS YOU CAN SEE, WE DEAL WITH SOME BIG ISSUES, UM, FOR MANY, MANY DEPARTMENTS THAT WE'RE JUGGLING.

SO THANK YOU FOR YOUR PATIENCE.

UM, SO COLLEAGUES, WE ARE NOW GOING TO MOVE TO ITEM THREE, WHICH IS DISCUSSING ISSUES SURROUNDING ACE.

UM, AND I WILL JUST ASK, UM, MY VICE CHAIR, WHO I'M GONNA INVITE UP TO LEAD THIS DISCUSSION TO TRY AND MAKE THIS AS BRIEF AS POSSIBLE SO THAT WE CAN END ON TIME WITH THE TECHNICAL DIFFICULTIES EARLIER.

WE'RE A LITTLE BIT BEHIND WHERE WE WERE HOPING TO BE AT THIS POINT.

UM, BUT I THINK, UM, I THINK WE SHOULD STILL BE ABLE TO GET EVERYTHING DONE BY 1130.

UM, SO VICE CHAIR

[3. Discuss issues surrounding ACE, LLC, and their operations, management, and financials of the downtown Hilton Hotel (Part 1 of 2)]

POOL, IF YOU'D LIKE TO INTRODUCE OUR SPEAKERS AND THIS ITEM, PLEASE.

THANK YOU.

THAT'S GREAT.

THANK YOU, CHAIR ALTAR.

AND I SEE THAT DAVID DUSTIN, WHO IS THE COUNSEL FOR ACE INC, IS I SEE HIS SQUARE.

AND WE ALSO INVITED THE PRESIDENT, UH, THE CHAIR AND THE TREASURER, PHILLIP SCHMANCY, AND JOEL SMITH THOMAS TO COME AND TALK BE HERE WITH US TODAY.

AND I KNOW MS. THOMAS WAS GOING TO KIND OF WALK US THROUGH A HIGH LEVEL, UH, DISCUSSION ABOUT ACE INC.

UM, I ASKED THEM TO GIVE US AN OVERVIEW OF WHAT WE WANT TO WELCOME THEM AND INTRODUCE, UH, THE MEMBERS TO, UH, THE AUDIT AND FINANCE COMMITTEE AND GIVE THEM A CHANCE TO TALK ABOUT ANY UPDATES OR ISSUES OR CONCERNS THAT THEY HAVE.

WE'RE LOOKING TO ESTABLISH A FRAMEWORK FOR REGULAR REPORTING FROM ACE ON THE CITY ASSET AND ITS FINANCIAL ASSET, AS WELL AS THE NEED FOR COUNCIL AS A WHOLE TO GET TIMELY NOTIFICATIONS ON IMPORTANT NEWS LIKE LAYOFFS OR MAJOR CHANGES IN THE FINANCIAL STATUS OF THE ASSETS.

WE CAN DO THAT THROUGH THE AUDIT AND FINANCE COMMITTEE.

AND THEN, UM, WE KNOW THAT THERE ARE VACANCIES THAT NEED APPOINTMENTS, UH, TO THE ACE BOARD, AND THAT WILL BE WORK FOR, UM, UH, THIS COMMITTEE THROUGH THOSE CITY MANAGER AS WELL.

I SEEN IS THAT MR. DAWSON HAS MS. THOMAS JOINED US.

SHE HAD A, SHE SHANNON, UH, MR. DAWSON IS THE ONLY ONE WHO'S JOINED US.

OKAY.

I TALKED WITH MS. THOMAS LAST NIGHT AND SHE WAS PREPARED TO MOVE HERE UP HERE.

SHE SAYS SHE JUST TEXTED ME.

DO YOU KNOW HOW MUCH LONGER BEFORE I AM ADMITTED? SO, UM, GOOD.

ALL TECHNICAL DIFFICULTIES CHECKING TO SEE IF IT FALL DOWN.

I'M LOOKING TO SEE IF I SEE HER, OR I MAY SEND YOU HER CELL PHONE NUMBER, SO YOU GUYS CAN CALL AND HOOK HER UP.

WOULD THAT WORK?

[01:05:08]

ALL RIGHT? I THINK SHE MAY BE ON THE WRONG.

SHE SAYS SHE IS ON THE LINK.

COREY, I'M SENDING YOUR GROUP CONTACT.

MEANWHILE, MR. DAWSON, UM, EITHER WE CAN, UH, TALK WITH MR. DAWSON SO WE DON'T GET FURTHER DECLINED OR, UM, COUNCIL MEMBER ALTER, IF YOU WANT TO TAKE, UH, TAKE UP ANOTHER TOPIC.

I THINK THAT WOULD BE, UM, MAYBE A GOOD IDEA.

I'M GOING TO LEAVE IT TO TECH TO GET IN TOUCH WITH MS. THOMAS AND I'VE SENT HER CELL PHONE OVER TO OUR CITY AUDITOR TO MAKE THAT CONNECTION.

SHE SAYS SHE'S BEEN WAITING SINCE NINE 30.

SO, UM, SORRY.

I JUST SENT THAT INFORMATION TO, UM, THE PERSON FROM MY OFFICE WHO IS SITTING WITH CTM.

IT LOOKS LIKE SHE DIDN'T PUNCH THE JOINT EVENT.

OKAY.

IT LOOKS LIKE SHE DIDN'T PUNCH JOIN EVENT

[6. Identify items to be discussed at future meetings.]

WHILE SHE'S DOING THAT.

MAYBE WE CAN, UM, JUST QUICKLY TAKE UP, AT LEAST