(This article was originally posted at the end of the adjacent article about the Senate race. But, per reader request we are posting it as a seperate article.)
Let’s take a quick look at the goings on at City Hall. I realize we are only capturing a small portion of the activities, but a recent report, from the City Auditor’s Office is very revealing about how City Hall works nowadays. Specifically I’m referring to an audit of the City funding and monitoring process for nonprofit organizations who seek and receive money from the City.
The audit found: “We reviewed 151 annual output and outcome performance expectations. We found that the nonprofit organizations did not meet 67 (44%) of the expected output and outcome performance expectations. This included 45% of the output and 42% of the outcome performance expectations.”
AUSTIN OFFICE OF THE CITY AUDItor
“We reviewed 151 annual output and outcome performance expectations. We found that the nonprofit organizations did not meet 67 (44%) of the expected output and outcome performance expectations.”
Furthermore, “For nonprofits that did not meet one or more performance expectations, there were significant deviations between what the City was expected to receive and what the nonprofit provided. For more than half of the performance expectations we reviewed that were not met, what was provided was more than 40% below the expected amounts. . .”
“As a result, the City is paying for services that were not fully delivered, and vulnerable residents may not get the services they are supposed to receive.”
Another revealing part of the audit occurred when auditors referred back to a 2019 audit and reported: “the City’s Anti-Lobbying Ordinance is not applicable to social service contracting unless authorized by the City Council. Six of the seven peer cities surveyed during the 2019 audit stated that anti-lobbying rules apply to procurement of social service contracts. The City of Austin’s current policy prevents award of these taxpayer dollars in accordance with procurement industry standard.”
AUSTIN OFFICE OF THE CITY AUDITOR
“As a result, the City is paying for services that were not fully delivered, and vulnerable residents may not get the services they are supposed to receive.”
Translation: The City has an anti-lobby rule for those seeking contracts. But in order for that rule to apply to nonprofits the City Council must take formal action. They had not done so before 2019.
So (switching back to audit language), the 2019 audit “recommended the City Manager work with Council to determine whether the City’s Anti-Lobbying Ordinance should apply to social service contracts.” Evidently the recommended (seven years ago) collaboration between the City Manager and Council did not reach a conclusion that Austin’s “Anti-Lobbying Ordinance should apply to social service contracts.”
The auditors try to offer some reasons for that decision, or lack of action — albeit in somewhat obfuscating language that reflects the fact that the Auditor reports to the Council (I don’t mean that in a condemning way, just to convey the reality of the structure. I’m grateful that the auditor is still getting this information out there for the public to see and people are free to reach their own conclusions.):
“The recommendations to develop a Citywide social service procurement policy and determine whether the City’s Anti-Lobbying Ordinance should apply to social service contracts have not been implemented due to shifting responsibilities and definitions of social service contracts and grants.”
No further mention is made in the current audit of lobbying or the anti-lobbying ordinance. So presumably the possibility of the Council applying the anti-lobbying ordinance to nonprofit contracting is remote at best, but maybe they will surprise us.
In other words, during the last seven years, the decision has been made, albeit quietly and out of public view, that the anti-lobby ordinance should not apply to nonprofits seeking City funding.
So let’s end with a summary and a related example. What the 2019 audit recommended was that people associated with nonprofits that are seeking, or already obtaining, funding from the City — that is people who stand to benefit financially from the City allocating funds to the nonprofit — not be allowed to lobby City Council Members for funding of the nonprofit with which they are associated. That’s because the process can be abused.
A traditional alternative is to entrust City staff with sorting through all requests for City funding of nonprofits and come back to the Council with recommendations. The Council can provide the staff with goals and objectives that they would like to see addressed with funding. The staff has also traditionally worked with the Council-appointed Community Action Network (now called the Community Advancement Network) to make funding recommendations. I know that many Council Members in the past, like yours truly, had a policy of steering nonprofit representatives to staff when they sought to lobby for funding. The 2019 audit recommendation to consider extending the anti-lobbying ordinance to nonprofit recommendations tells me that this traditional practice is no longer in operation. Plus, seven-years worth of Councils since then have failed to act on the recommendation.
When relations get too cozy between funders and fund recipients it risks corruption and the appearance of corruption. It can also result in something of a revolving door for City funds. Last year’s Prop Q campaign provides an unsettling example of what I mean. In Prop Q, the Mayor and Council supermajority sought voter approval for a tax increase significantly beyond the annual increase allowed by state law without an election. Many of the funds from the tax increase were intended to go to nonprofit organizations. Specifically, $51.5 million of that proposed tax increase was to be spent on services related to homelessness.
Several nonprofit groups who stood to gain financially from Prop Q donated large sums to the Prop Q campaign. That included ECHO (Ending Community Homelessness Coalition), the City’s leading recipient of funds for homelessness services. As readers likely recall, Prop Q failed by an almost two-to-one majority.
There is a very high likelihood that that money came originally from City coffers then was donated to the campaign as an investment in getting voter approval for more City funding. In this way it is a revolving door for money, but none of that money revolves to taxpayers. They only supply money.
This arrangement is not exactly the same thing as nonprofit representatives lobbying Council Members to fund their agencies. But, it is an example of how cozy the relationship between the Council and those the City supports financially can become. And, direct lobbying by groups risks that the best choice for the job — as evaluated by staff — could lose out to a nonprofit with better connections or more effective lobbying. It also risks making the path of City funds into Mayoral and Council campaigns more direct and more participatory on the part of the Council. It actually risks even worse.
___________________________
Folks: Folks, please consider subscribing or donating to the Austin Independent. It will help us, for example, to expand our readership base and to pay for important public information requests. To subscribe or donate, click here.
To receive notification when the Austin Independent posts stories or to write to the editor please send us an email under Contact on the home page,or click here.
The Austin Independent, a publication of The Austin Independent, LLC
All Rights Reserved