City Strengthens Process to Foster Ethical Environment
Published on December 02, 2021
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DENVER – Denver’s Board of Ethics is in a stronger position to support ethical actions by all city employees after our February 2020 audit, according to Denver Auditor Timothy M. O’Brien, CPA.
“The Board of Ethics and members of the City Council took meaningful and timely action,” Auditor O’Brien said. “The new processes are thoughtful and substantive so the public can feel assured of better accountability for public employees.”
Out of 18 recommendations from the original audit, the Board of Ethics and the Clerk and Recorder’s Office fully implemented 10, partially implemented three, and left four unfinished. The Board of Ethics disagreed with one recommendation at the time of the audit but implemented it anyway.
Thanks to collaboration between the Board of Ethics and members of the City Council, the city’s Code of Ethics was updated in April 2021. The code now allows the board to accept anonymous complaints and provides criteria to ensure complaints are credible before beginning an investigation. The board may now also formally request follow-up from city managers about what action they took in response to an ethics violation.
“City leaders took significant steps to foster an ethical culture in the city,” Auditor O’Brien said. “I hope the board’s authority and new processes will encourage more employees to feel comfortable reporting any unethical actions they might identify.”
The board also worked with the Mayor’s Office and the City Council to amend the code and allow the executive director to file a written inquiry regarding potential failures to comply with the Code of Ethics. The board originally disagreed with our recommendation to allow board-initiated investigations but fully implemented it anyway.
The Board of Ethics still has some work to do to strengthen ethics training for all management levels and to work towards better sharing of data and information among agencies. Board members also need to clarify when and how they should recuse themselves from an investigation.
We also encourage the Clerk and Recorder’s Office to continue to build upon the progress it made on our recommendations.
The office took some steps to ensure city officers comply with gift reporting requirements. The office created processes and procedures for notifying city officers of gift reporting deadlines, tracking submitted disclosures, providing notices of noncompliance, and preparing complaint letters for officers who don’t file the necessary disclosures.
However, the Clerk and Recorder’s Office still needs to assign responsibility for enforcing compliance with reporting requirements because we found officials continued to miss deadlines or failed to file disclosures until more than two months after the deadline. Also, City Council, the Board of Ethics, and the Clerk and Recorder's Office should work together to reconsider whether the review of gift disclosures should be part of the city ordinance.
“City oversight of gift reporting and financial disclosures for officers and officials should be clear and transparent,” Auditor O’Brien said. “As we note in this follow-up, residents should have confidence that officials disclose gifts appropriately.”
In December, our office also completed a follow-up assessment of the Denver Employees Retirement Plan Actuarial Valuation report. An accurate actuarial valuation allows decision-makers to make informed decisions about funding pension benefits, because it measures and describes the funded status of a retirement plan, the contribution rates, and the assessment and disclosure of risks.
We found managers of the plan successfully clarified several assumptions as we recommended.
However, managers of the plan did not adopt an amortization policy for future benefit increases and it did not include a full development of the proposed budgeted contribution rate for the upcoming year in its valuation reports.
AUDITOR TIMOTHY O'BRIEN, CPA
Denver Auditor's Office
201 W. Colfax Ave. #705 Denver, CO 80202
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