Questions & Answers about the County Auditor's proposed amendment to remove 11.514 (B) from the County Code
County Auditor Jennifer McGuirk is asking the Board of County Commissioners to remove the following from the Preschool For All portion of the County Code: 11.514 (B) Independent performance audits will be conducted on the use of funds generated by the Preschool For All Personal Income Tax.
Auditor McGuirk has prepared this Q&A to answer questions from community members and Commissioners about the proposed amendment.
The Board is scheduled to hear the first reading of the amendment at their April 4, 2024 meeting.
Key questions
Why isn’t the language needed in the County Code?
You say the language currently in the County Code is confusing. How so?
Didn't people vote that they wanted audits of Preschool For All?
Additional details
What County Charter language have voters approved about performance audits?
Is the language that was in the voters' pamphlet different from what's in the County Code?
Why are you raising this concern now?
Question: Why isn’t the language needed in the County Code?
Answer: The Code does not need to require independent performance audits of Preschool For All because the County Charter already requires the County Auditor to conduct performance audits of all county operations and financial affairs.
No other chapter of the Code includes the language I am asking the Board to remove. Yet performance audits still happen continually at the county because the Charter assigned that work to the County Auditor. For example, in the last five years alone, my office has conducted performance audits of operations encompassing all county departments, such as the county’s response to the COVID-19 pandemic, as well as on county operations and financial affairs as diverse as those in the Health Department, Department of County Management, Library, the Joint Office of Homeless Services, and the Department of County Human Services.
Question: You say the language currently in the County Code is confusing. How so?
Answer: It is confusing because it is the only place that the Code mentions performance auditing. This is despite the fact that the Code includes about 13 chapters covering county operations and financial affairs, and per the County Charter, my office shall conduct performance audits of all of these. A careful reader of the Code could wonder why it calls for conducting performance audits of Preschool For All, but doesn’t call for performance audits of any other county program. They could also wonder if this connotes some level of importance for auditing Preschool For All above other county programs. I want to avoid those potential misunderstandings. In my opinion, performance auditing is not mentioned in other sections of the Code because the Charter is clear: The Auditor shall conduct performance audits of all county operations and financial affairs. Therefore, my office will conduct performance audits of Preschool For All.
Question: If there isn't language in the County Code about conducting performance audits of Preschool For All, will performance audits still happen?
Answer: Yes, my office will still conduct performance audits of Preschool For All. As County Auditor, my job is all about promoting accountable county government, and a key part of that is conducting performance audits of all county operations and financial affairs, including Preschool For All. In fact, my office is currently conducting an independent performance audit of Preschool For All. Our audit report will include recommendations for Preschool For All, and we will follow up on the status of those recommendations.
My office will also assess every fiscal year if a performance audit of Preschool For All is needed. Our annual risk assessment of county divisions considers more than 10 measures including budgeting and staffing, the potential life and safety impact if the division does not adequately perform core functions, how the division serves historically under-resourced populations, how long it has been since we audited the division, and other factors. My interest in amending the Preschool For All Code is to ensure it is consistent with the County Charter with respect to my office.
Question: Didn't people vote that they wanted audits of Preschool For All?
Answer: The language on the actual ballot in November 2020 stated the following:
26-214 Establishes tuition-free preschool program, higher earners income tax funding.
Question: Should County establish tuition-free "Preschool for All Program" with new 1.5 to 3.8 percent tax on income above thresholds?
Voters who only looked at their ballot would have seen no language about audits when they voted on the Preschool For All measure.
Also, the Preschool For All language published in the voters' pamphlet statement included the following:
Ballot Title summary: Administration by Department of County Human Services (Program), Chief Financial Officer (Tax). Establishes Board appointed advisory committee for oversight, policy recommendations. Independent performance audits. Other provisions.
Explanatory statement: Program is subject to independent performance audits.
Voters who read the ballot title summary and explanatory statement in the voters’ pamphlet could have easily read the language about audits as basic statements of fact about the work of their County Auditor. And I agree with those statements of fact. Preschool For All is subject to independent performance audits by the County Auditor, and voters can be confident that performance audits of Preschool For All will occur. This amendment respects the will of the voters by ensuring adherence to the County Charter’s language about performance audits - language that voters have explicitly approved.
Question: What County Charter language have voters approved about performance audits?
Answer: In 1998, voters amended the Charter to require the County Auditor to conduct performance audits. As recently as 2022, the Multnomah County Charter Review Committee advanced Charter amendments about the County Auditor, which voters overwhelmingly approved. One of these strengthened the County Auditor’s ability to access information needed to carry out assigned duties including performance audits, and this was articulated in the voters’ pamphlet. I think the voters’ expectations for the County Auditor are clear.
The Charter states that the powers it vests in specific roles should be construed liberally. It vests powers to the Auditor including the power to conduct performance audits of all county operations and financial affairs. The Charter makes assignments to other elected officials, and I would argue that these directions preclude others from carrying out those duties or delegating them. For example, the Charter states that the governing body shall be a board of five County Commissioners, and it states that the Chair shall be the chief executive officer. I can’t conceive of the Board adopting an ordinance that would create ambiguity about who is to carry out the duties that the Charter assigns to them. I don’t think the approach to duties that the Charter assigns to the Auditor should be any different.
Question: Is the language that was in the voters' pamphlet different from what's in the County Code?
Answer: In my opinion as an auditor, it is substantially different. This is because the language in the voters’ pamphlet was this: Independent performance audits. Subject to independent performance audits. These are statements of fact. The County Charter is clear that the County Auditor is to conduct performance audits of all county operations and financial affairs, including Preschool For All.
But what the Code states - Independent performance audits will be conducted on the use of funds generated by this tax - is different. This is because the Code is making a directive. It does not name who that directive is to. One reason the assignment may not be to a specific person or office is because the Board cannot pass Code that assigns work to the County Auditor without the County Auditor's consent. I was not consulted on the development of the Code, and I would not have consented to the language because it is not necessary. Charter already assigns to the County Auditor the duty to conduct performance audits of Preschool For All.
The Code language can be seen as a directive to me and future County Auditors, which presents a threat to my office’s independence. This is because the Charter states that the Auditor shall conduct performance audits in accordance with generally accepted government auditing standards, and these standards require my office’s independence from county leadership and management.
Because the Code language makes a directive to no one, it could also be seen as a way to bypass my office by hiring an outside firm. I think that is a concerning precedent that is at odds with the Charter. The Charter, which the people vote on, vests the power to conduct performance audits to the County Auditor.
Question: Why shouldn't a county official outside of the Auditor’s Office have a firm conduct independent performance audits of county programs?
Answer: I believe this would not be consistent with the County Charter, which clearly directs the County Auditor to conduct performance audits of all county operations and financial affairs. The Charter states that the powers it vests in specific roles should be construed liberally.
Even if it were somehow consistent with the Charter, there are risks to county management outsourcing performance audit work:
- Contracted auditors, the audit itself, or the audit report may be subject to management influence or interference, particularly when management directly selects and oversees the contracted auditors. Thus, there is the risk that the audit work may not be considered independent or reliable.
- Some consultants hired to perform auditing services do not perform audits that adhere to the auditing standards that the Charter requires - standards of high quality, impartiality, and independence. Their findings and recommendations would then be unreliable.
- Contracted auditors or consultants hired to perform auditing services are not directly accountable to the public. Contracted auditors or consultants may not produce reports that are readily available to the public.
My office does not face these risks. My office is directly accountable to the public, who can be assured that if my office has done the audit work and published the audit report that they can trust it. Voters assigned this work to my office in the Charter.
Certainly county management can contract with consultants at any time to support program improvements. But if the intention of the language in the voters’ pamphlet was to ensure accountability, then the most appropriate place for those independent performance audits is the County Auditor’s Office. I contend that this is where voters expect the work to take place.
Question: Why are you raising this concern now?
Answer: My office is conducting a performance audit of Preschool For All. Until my office began this work, I wasn’t aware that the Preschool For All Code included language about performance audits. As soon as I learned about the language, I started the process to bring a Code amendment to the Board of County Commissioners for consideration. My interest here is in alignment between the Code and the County Charter as it relates to my office.