2015-2016 Santa Clara County Civil Grand Jury Report the City of Santa Clara, the Santa Clara Stadium Authority, Levi’s

Conclusions 7

• CL1 Page 7
  Since the passage of the Santa Clara Stadium Taxpayer Protection and Economic Progress Act (Measure J), there has been no compliance audit. During the course of the Grand Jury’s investigation, the Santa Clara Stadium Authority board approved a Measure J compliance audit to be performed by a third party, to be selected.
• CL2 Page 7
  The public safety costs incurred during the first two NFL football seasons at Levi’s Stadium have exceeded the monetary threshold stated in the Santa Clara Stadium Taxpayer Protection and Economic Progress Act (Measure J).
• CL3 Page 8
  The Santa Clara Stadium Authority’s Finance Director, Treasurer, and Auditor positions are currently held by the same individual.
• CL4 Page 5
  The Grand Jury was given information that City employee hours spent on Stadium
• CL5 Page 6
  operations and maintenance may have been improperly allocated to the City. This has also been widely reported in the media. The Grand Jury interviewed many people but was not able to verify this assertion. As discussed above, the City has already begun efforts to have a comprehensive third-party audit of Measure J, and the Grand Jury recommends that the audit include a review of City employees’ allocation of time between Stadium and City business. The Grand Jury is concerned about the oversight position of Stadium Authority Auditor being held by the Stadium Authority Finance Director. The Stadium Authority should adopt the same structure as the City, where the auditor position is separate and independent from that of the finance director to prevent the appearance of any conflict of interest. If the public safety cost overage continues through the 2016 NFL season, the City should exercise its contractual right under the stadium lease agreement to open negotiations with the Stadium Authority and StadCo for a possible increase in the public safety cost threshold. This is also stated in Measure J. A comprehensive audit focused on compliance with Measure J and the use of City of Santa Clara general funds should be conducted immediately. The audit should include a review of the billing and tracking procedures used when City employees perform Stadium business. The results of the audit should be presented to the Santa Clara City Council in open session.
• CL6 Page 7
  Findings and Recommendations Finding 1 Since the passage of the Santa Clara Stadium Taxpayer Protection and Economic Progress Act (Measure J), there has been no compliance audit. During the course of the Grand Jury’s investigation, the Santa Clara Stadium Authority board approved a Measure J compliance audit to be performed by a third party, to be selected. Recommendation 1a The Santa Clara Stadium Authority should specify that the compliance audit cover the time period beginning with the passage of Measure J through March 31, 2016, the end of the Stadium Authority fiscal year. Recommendation 1b The Santa Clara Stadium Authority should specify that the scope of the compliance audit include whether City of Santa Clara general funds have been used for the operation or maintenance of Levi’s Stadium in violation of Measure J. Recommendation 1c The Santa Clara Stadium Authority should specify that a Measure J compliance audit include a review of the billing and tracking procedures used when City employees perform Stadium business and how and when the City is reimbursed. Recommendation 1d Once the audit is complete, the Santa Clara Stadium Authority should release the results to the public. Finding 2 The public safety costs incurred during the first two NFL football seasons at Levi’s Stadium have exceeded the monetary threshold stated in the Santa Clara Stadium Taxpayer Protection and Economic Progress Act (Measure J). Recommendation 2 If the public safety cost overage continues through the 2016 NFL season, the City of Santa Clara should seek an adjustment of the public safety cost threshold in accordance with clause 7.5.4(b) of the Amended and Restated Stadium Lease
• CL7 Page 8
  Agreement by and between the Santa Clara Stadium Authority and Forty Niners Santa Clara Stadium Company LLC dated March 28, 2012, As Amended and Restated as of June 19, 2013. Finding 3 The Santa Clara Stadium Authority’s Finance Director, Treasurer, and Auditor positions are currently held by the same individual. Recommendation 3 The Santa Clara Stadium Authority should adopt the same structure as the City of Santa Clara, where the auditor position is separate and independent from that of the finance director.

No Responses Found 2

Government entities assigned to respond to this report. No response documents have been linked in our database.