Atlanta auditor Leslie Ward returned to the city council on Wednesday with another report critical of the city’s ability to track its equipment. The latest audit finds Atlanta has weak controls over employees’ use of city vehicles, which invites abuse.
Ward said most city departments do little to track the location and usage of the city’s roughly 1,000 passenger vehicles. That leaves open the possibility that employees could drive the cars for personal reasons, putting the city at risk of under-reporting taxable fringe benefit income to the IRS, she said.
It's the third report her office has issued in recent weeks raising questions about the city's ability to manage its resources. In late August, Ward presented an audit that found the Department of Public Works can't account for at least $2.2 million in materials, such as asphalt, lacks critical inventory management controls and is vulnerable to undetected theft.
And just this week, Ward reported results of a June investigation into the Department of Watershed Management that found the agency can't account for 10,000 water meters. That's in addition to other missing or stolen goods from the agency, including an $80,000 backhoe and 28 industrial water meters worth $5,200 apiece.
“We seem to have difficult with basic management and supervision,” Ward said on Wednesday.”…Lack of controls creates risk, potential for misuse and outright fraud.”
Mayor Kasim Reed is traveling in China this week and is unavailable for comment. The mayor has previously said he plans to focus more intently on operations after spending his first term securing the city’s financial footing post recession.
“Folks at home need to understand that one, we take the role of the auditor very seriously. But we are reforming an organization that by all examples was in severe distress and we’re now recovering from that,” he said in late August, following the report on Public Works.
The mayor's office has already taken steps to address problems within Watershed, including terminating more than a dozen employees in August following an investigation by the city's law department into reports of theft and mismanagement. Reed also left open the possibility of staffing changes within Public Works.
Human Resources Commissioner Yvonne Yancy told the council on Wednesday that Reed’s administration has strengthened its take-home use policy, but agreed those rules could be more uniformly applied. City officials also noted Reed’s administration lowered the number of employees eligible for take-home cars, and is considering installing cameras inside the vehicles.
The report is the latest of three audits Ward’s office has conducted on city vehicles since 2006. Ward said the most recent audit was prompted by the city’s failure to implement each of her previous recommendations.
- Five city departments totaling nearly 80 percent of the city's passenger fleet do not require employees to keep usage logs.
- Most cars are not required to be parked in a specific location, making it difficult for a manager to track a vehicle.
- Only the Department of Watershed Management uses GPS monitoring to track its vehicles, but for 60 percent of its fleet.
- More than a fifth of Watershed cars with GPS that weren't authorized to be used overnight "showed stops of at least 12 hours outside of the city and outside of department facilities" last year.
- The city may be in violation of IRS rules governing take-home vehicle benefits. Ward found that the city's vehicle use policy is in conflict with the IRS commuting rule, which prohibits any personal use. The city's policy allows for intermittent personal use, she said.
The mayor’s office accepted Ward’s recommendations, which included giving some employees a vehicle allowance instead of a car, tracking vehicles with usage logs and GPS monitors, enforcing parking requirements and changing the city’s usage policy to be in line with tax code.
District 6 Councilman Alex Wan said tightening up the city’s take-home car policy is within the city’s grasp. He’s far more concerned with reports of missing or stolen items in Watershed or Public Works.
“This is an easy fix…this is manageable,” he said. “The others will take a long time to address.”
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