FROM: Homer L. Bludau, City Manager
Dennis Danner, Administrative Services Director

DATE: September 24, 2002

SUBJECT: AIRPORT GRANTS FINANCIAL REVIEW

RECOMMENDATION

Receive, discuss and file the Airport Grants Financial Review Report for the Airport Working Group (AWG) and Citizens for Jobs and the Economy (CJE) dated September 16, 2002.  Provide staff with any further direction regarding this matter.

DISCUSSION

At the July 9, 2002 Council Meeting staff was given direction to prepare for a review of the public information grants awarded to AWG and CJE on May 22, 2001 and October 23, 2001 respectively.  Accordingly, on July 16, 2002 letters (attached Exhibits 1 and 2) were sent to both groups requesting certain financial information be returned to the City by August 1, 2002.  Both organizations complied with this request for financial information by the specified date.

After this information was received, the City contacted the independent certified public accounting firm of Vavrinek, Trine, Day & Co., LLP (Vavrinek) to perform an agreed upon procedures review of this information.  The City’s initial letter to Vavrinek, dated August 9, 2002, is attached as Exhibit 3.  The final agreed upon procedures letter between the City and the accounting firm, received from Vavrinek, dated August 20, 2002, is also attached to this report as Exhibit 4.

After the procedures for the review were agreed upon, staff from Vavrinek performed field work over an approximate three week period and provided a draft report to the City on September 12, 2002 that was reviewed with staff on September 13, 2002.  The report was finalized on September 16, 2002 and scheduled for discussion at the Council Meeting of September 24, 2002

The Principal from Vavrinek in charge of this engagement, Joe Aguilar, as well as the Supervisor, Roger Alfaro (CPA), will be present at the Council Meeting to report the results of their review as well as to answer any questions the Council may have about the review or its findings.

In conclusion, the review performed is known as a "compliance review" to determine whether the grant expenditures conformed to the terms and conditions expressed in the written grant agreement.  The firm of Vavrinek, Trine & Co. has provided a written document expressing its findings.  However, it is up to the City Council, the party who entered into the grant agreement, to make the final determination based on the information provided in the compliance review and based on its understanding of the intent of the agreement.
 
 

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