Jan 9 2014

Risk Assessment Policy Approved by Council

Cost overruns, unidentified risks, legal and engineering oversight are addressed in the finally adopted Risk Assessment Policy.

Following Piedmont’s unplanned expenditure of well over 3 million tax payer dollars, a result of the  failed Blair Park/Moraga Canyon sports complex project and faulty private underground utility project, residents and groups such as the Piedmont League of Voters (LWV) were concerned and offered suggestions on how to protect Piedmont from future unplanned financial impacts.  The City Council finally unanimously approved a Risk Assessment Policy.

Risk problems centered on the lack of step-by-step monitoring and reporting of risks and costs.  The new policy lays out actions to alert the Council, the public and the staff when capital projects costing over $300,000 are considered, approved and implemented. Public knowledge early in project development was specifically requested by the LWV and others.

The policy is intended to provide a thorough review of projects prior to expending large amounts of City time and money on projects without public knowledge and involvement.

Rob Hendrickson, a construction law attorney and civil engineer who served on the LWV’s Task Force on Civic Governance, repeated the monthly accounting recommendation presented in April, 2013 by then LWV President Julie McDonald.  He urged that as a project was being implemented a monthly accounting should be presented to the Council to assure staff was monitoring the project and the public was aware of problems.  This request was echoed by High School student Julie Adams, who felt this was common in business and should be a part of the policy.

Tim Rood, candidate for City Council, agreed with the accountability measures noted in the LWV communication.

Acting City Attorney Michelle Kenyon cautioned against including specific timelines for the City Administrator, such as monthly reporting, as this could result in further risk if the timeline was not met. Council member  Jeff Wieler stated the responsibility for compliance rested with the City Administrator as part of the job description and non-compliance would be dealt with through personnel evaluations and ultimately through the  Council election process.

Public Works Director Chester Nakahara who was responsible for drafting and redrafting the much belabored policy responded to concerns. Numerous “and/or” clauses in the policy language were at issue as to when and what would be presented to the public and Council during the conceptual and implementation phase of a project.  Nakahara pointed out that the requirement that the City Attorney and City Engineers review projects would be an expense for the City.

Excerpts from the City Charter:

The City Administrator, “Shall keep the Council fully advised as to the financial condition and future needs of the City…”

The City Attorney is to “Represent and advise the Council and all City officers in all matters of law pertaining to their offices;” “Approve the form of all contracts made by and all bonds given to the City, endorsing approval thereon in writing;” “All contracts shall be drawn under the supervision of the city attorney.”

The City Engineer description states, “There shall be a city engineer who shall have supervision over all matters of an engineering character as required by State law, or as assigned by the City Council.”

Council member Garrett Keating supported contract review by the City Attorney to protect the City from risks on public and private projects.

Review by the City Engineer is intended to make certain all projects are properly engineered and contracts are appropriately specified.

Consultants employed to oversee or advise on projects would be an additional cost of any project.

City Administrator Geoff Grote, who is retiring within weeks, stated that the policy would not prevent all future problems, while acknowledging the policy would be helpful and could be modified as needed in the future.

Mayor John Chiang was repeatedly thanked for bringing the policy to the Council for approval prior to his February retirement from the Council.

Click for the staff report and communications.

Click for draft minutes to view changes approved by the Council.

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