As Miami-Dade County stares at forced budget cuts after years of spending at will, it’s wisely starting to look for where money may be leaking out unnoticed. Commissioners, the taxpayers thank you for such close inspections.
On the other side of the coin, however, ill-considered moneysaving forays could cost taxpayers more than whatever quick savings they can tally.
As for plugging tiny leaks at the cost of not only long-term benefits but millions to undo a hasty misstep, look to the City of Miami, which saved a few dollars but lost for decades a civic centerpiece – and then eventually spent more to undo the folly.
Miami had commissioned landscape architect and sculptor Isamu Noguchi to create Bayfront Park with a dazzling fountain, which shot plumes skyward in varying patterns until the city decided to save on the water bill and electricity to run the fountain.
So, the city ripped out the mechanism and shut down the fountain, a decades-long loss of urban beauty. Now the city has replaced the fountain at more than its original cost, eating up past savings.
That’s pennywise and pound foolish.
I thought of that folly while listening to a debate over hiring multiple firms to do independent financial audits of county boards and the offices that support them. Watching spending is vital, but hiring outsiders might cost far more than audits would save.
Legislation by Danielle Cohen Higgins and René García to require the audits came before the county’s Appropriations Committee last week with admirable aims but factual gaps, including how many boards are involved, which would be audited, which are already audited, and who would pay for the outside audits.
In the hearing, those gaps were noted but left unfilled.
What, asked Commissioner Raquel Regalado, is the funding source to pay for the audits, which boards would be audited and who would do the auditing?
All boards that handle money would be involved, said Ms. Cohen Higgins, and each could pick its own outside auditor to do the work.
“We’re going to pay for that,” Ms. Regaldo said, so how much?
Pick an amount, said Ms. Cohen Higgins. “This is certainly not geared to those boards that are providing coffee.”
“Within the ecosystem of boards there are actually more that have less money than there are boards that have more,” Ms. Regalado responded. For such boards, she said, “the audit would be their most expensive line item.”
In other words, the county might pay more to check on boards’ spending than they had spent, so those outside audits would add more to costs than they could ever save. But they’d be pennywise.
It turned out that, according to county Chief Budget Officer David Klodfelter, every board that’s funded through the county’s general fund is already audited by the county clerk in the general fund audit.
But would they also be required under the legislation to hire an outside auditor? Ms. Regalado asked for a list of all boards that would require an audit and how much it would cost to audit them, “and then the ones that you would like to audit.” She also asked how much would have to be added to the general fund to pay for the new audits.
“I’m all for auditing,” she said. “The auditing from a third party comes at a cost to the county at a moment where we’re talking about where we don’t have” enough funds to meet needs.
“The only way we can get through this hard time is by being transparent and by looking at line items” through an audit, said Commissioner Roberto Gonzalez.
In the end, the measure to require additional audits at additional costs went unanimously to the full commission without being transparent enough to list what boards would be required to have paid audits, how much they could cost the county or what had triggered a sudden demand for new audits. Nobody mentioned fraud or misspending or overspending, just a sudden need to have an unspecified number of added audits.
A fiscal impact statement with the legislation from Cathy Burgos, chief community services officer, said “requiring financial audits for these board will not have a fiscal impact to the county, as the boards will be responsible for any audit fees. The cost of these audits will vary for each organization depending on the service provider and the complexity of the audit.”
But there is no free lunch. If boards that come under the county’s general fund pay for audits, that costs taxpayers. If the clerk’s office that handles that audit pays for it, that still costs taxpayers. If other boards pay from internal funds, that simply reduces the services they provide with their funds.
There is real cost to an audit. Ordering outside audits of a handful of targeted boards and administrative support groups might be wise. But overly broad legislation is overreach, no more cost effective than shutting off the water to a perfectly serviceable fountain.
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