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Findings 14 findings
F1
The Irvine City Council originally had a vision of a metropolitan park that would rival Central Park in New York, Golden Gate Park in San Francisco, and Balboa Park in San Diego but neglected to follow standard industry practices in managing such a large project.
F2
From the outset, with the City of Irvine assuming a land developer role, the project was poorly managed and did not follow conventional program management principles. There was excessive political control, influence, and interference over the Great Park project. The City allowed individuals, including some elected officials to make technical decisions without ensuring that these individuals were qualified or experienced to make such decisions. Basically, the City abandoned sound project management principles. "Irvine" Great Park: A Legacy of Hubris
F3
The organizational structure established by the Irvine City Council was such that total control over the project rested with the City Council and the Orange County Great Park Corporation was relegated to an advisory role.
F4
Many California communities, including Mission Viejo, Belmont, Watsonville, and Norwalk have ordinances restricting elected officials from interfering in operational activities under a city manager.
F5
Appropriate transparency over the project was lacking. The City Council and the OCGPC did not publicly reveal the estimated true costs to build the park as originally designed as well as other non-capital expenditures.
F6
There were serious questions about the ability of the City to implement the original design based on the City's available financing and U.S. Navy constraints.
F7
Many of the contracts of the Great Park were open-ended and without defined deliverables, minor oversight, or safeguards. There seemingly was no effective oversight over invoices, contract compliance, or quality control.
F8
There seemed to be over-use of no-bid and sole source contracts without full justification which possibly violates the City's processes and procedures. There are also questions of clarity relative to terms and conditions of current contracts.
F9
Orange County Great Park financial statements indicated that less than 50% of expenses incurred were spent on capital, i.e., on the actual design and construction of the Great Park, which is well outside industry standards. The remaining expenses were on salaries, overhead, and contract services.
F10
The complexity of financial transactions relative to the Great Park made it difficult to understand the flow of funds relative to sources and uses of monies. The lack of clarity on such basic issues as the number of units authorized to be constructed raises concerns about other issues in the contract that are unclear. This was a major flaw in the reporting system.
F11
An inordinate amount of funds were spent on public relations and lobbying, "free" public events, exhibitions, food, and a balloon whose benefits did not justify its costs.
F12
The current plan for the construction of the Great Park will require less funding than the original plan but will still require a high cost of construction and operations and maintenance that will be passed on to home buyers.
F13
There was no explanation by the City Council as to where the tax increment of $43 million received by the IRDA from 2005-2011 was utilized.
F14
The OCGPC has become a "shell" corporation and serves no intrinsic function as members of the Board of Directors are the same as members of the Irvine City Council. "Irvine" Great Park: A Legacy of Hubris RECOMMENDATIONS In accordance with California Penal Code sections 933 and 933.05, the 2014- 2015 Grand Jury requires (or, as noted, requests) responses from each agency affected by the recommendations presented in this section. The responses are to be submitted to the Presiding Judge of the Superior Court. Based on its investigation titled "Irvine" Great Park: A Legacy of Hubris," the 2014-2015 Orange County Grand Jury makes the following eight recommendations:
Recommendations 2
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R1All of the funds related to Great Park financial activity should be presented as a separate section in the City's CAFR to allow for greater transparency (F4; F9).
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R3The City of Irvine should create and consider adopting an ordinance similar to that adopted in other cities, such as Mission Viejo8, that limits the interference and influence of City Council members with the operational aspects of the city. (F1; F2; F4).
Commendations 7
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CM1Bosque: The term bosque is from the Spanish meaning "woodlands." It refers to clumps of trees found along flood plains of stream and river banks in the southwestern United States.
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CM2The Irvine City Manager stated in 2003: "The financial plan for the OC GP will fulfill the promise our City made to the people of Orange County when we drafted Measure W nearly two years ago. "Working in cooperation with the Navy, we have created a sound financial plan for building and maintaining the Great Park without any federal, state, or local taxpayer subsidies. "Master-planned communities throughout Southern California, including Irvine, maintain high standards and amenities by requiring developers and property buyers to contribute to the construction and maintenance of public facilities. "Real estate experts who have reviewed the Orange County GP Plan all agree that the sale of the developable property will more than support the $200 million in development fees. The assessments and special maintenance levies, plus the basic 1% property tax, will not exceed the overall 2% property tax levied on property owners in most master-planned communities. "The most exciting feature of this plan is the speed in which it allows the GP to be developed. "We will begin tearing up the runways within days of the completion of the sale of the property. Our children will be playing in the county's largest Sports Park, and people will be able to enjoy the first phase of the Meadows Park within three "Irvine" Great Park: A Legacy of Hubris years. Within only five years of the sale of the property, the OCGP will be fully landscaped and will serve all of our county for many generations to come." (p. 1)
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CM3According to Orange County Great Park Planning Report (2003): "Other great metropolitan parks have required fifty years or more to develop. By contrast, the Orange County Great Park development strategy—harnessing the power of private capital and the benefit of enlightened public planning—will enable all key elements of the Great Park to be developed within five to seven years of the sale of the property."
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CM4The 2005-2006 Grand Jury stated in their report "Orange County Great Park: Whose Park Is It?": "By merging the operations of the City of Irvine and the GPC, employees of the GPC are now employees of the City of Irvine and everything from job assignments to raises and other factors are at the behest of the City of Irvine. It raises the question, what exactly is the purpose or function of the OCGPC if the City of Irvine collects all park related revenue, hires employees whose duties are related to the park, and pays the other expenses related to the park." (p. 9)
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CM5This is not in violation of public law. According to the Health & Safety Code (§33200, sub d). [a]) a city council, in activating the redevelopment agency in its community, is authorized under State law to name itself to members of the redevelopment agency board, as the Irvine City Council did when it adopted Ordinance 99-04 in 1999 activating the Irvine Redevelopment Agency.
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CM6City of Irvine Contract Award Process: A contract can primarily be awarded in the following three methods. Use of Consultant Team Member
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CM7The following is an excerpt from the Mission Viejo Municipal Code: "The city council and its members shall deal with the administrative services of the city only through the city manager, except for the purpose of inquiry, and neither the city council nor any member thereof shall give orders to any subordinate of the city manager. For purposes hereof, "inquiry" means any and all communications short of giving orders, directions, or instruction to any member of the administrative staff. Such members shall provide all information reasonably requested by any councilmember. The city manager shall take his orders and instructions from the city council only when sitting in a duly convened meeting of the city council and no individual councilmember shall give any orders or instructions to the city manager. The city council shall instruct the city manager in matters of policy. Any action, determination or omission of the city manager shall be subject to review by the city council. The city council may not overrule, change or modify any such action, determination or omission except by the affirmative vote of at least three members of the city council." (Code 1988, § 2.08.070) "Irvine" Great Park: A Legacy of Hubris REFERENCES Aleshire & Wynder Memorandum. (2014a, October). Great Park Audit: Status update. Irvine, CA. Aleshire & Wynder Memorandum. (2014b, October 14). Great Park Audit: Status update. Irvine, CA. Aleshire & Wynder (2015, March 24). Report of Special Counsel. Irvine, CA. Author. American Institute of Architects (AIA). (2007, August 27). Standard for of agreement between owner and architect: Document B141-1997 Part I. Irvine, CA. BLL/PBS&J Program Management Team. (2006, November 17). Review of the Great Park Design Studio invoices (#2-#7, #9). Irvine, CA. BLL/PBS&J Program Management Team. (2006, October). Review and Comments: Great Park Design Studio contract no. 2 monthly report: October 2007. Irvine, CA. Bovis Lend Lease. (2008, July 16). Orange County Great Park: Program Management Team: Schematic Design 70% milestone submitted review and comments. Irvine, CA. Burgess, M.A. (2014, June 24). Orange County Great Park Corporation [Deposition]. Newport Beach, CA. City Manager. (2013). 2014 Reorganization plan. City of Irvine, CA. Clark, C. (2014, April 23). Orange County Great Park Corporation [Deposition]. Newport Beach, CA. Retrieved from: http://www.cityofirvine.org/cityhall/cityclerk/depositions.asp County Executive Officer, County of Orange. (2006). Response to Orange County Grand Jury Report, "The Orange County Great Park: Whose park is it." Santa Ana, CA. Cowan, J. (2014, October 19). Yet another flare-up over Great Park. Los Angeles Times, p. A33. Design Studio. (2006). Orange County Great Park Preliminary Master Plan. Irvine, CA. Ellzey, M.D. (2014, June 18). Deposition: Orange County Great Park. Newport Beach, CA. Retrieved from: http://www.cityofirvine.org/cityhall/cityclerk/depositions.asp Elmahrek, A. (2014a, September 7). Video derides findings of Great Park audit. Voice of Orange County, http://ww.voiceofoc.org. Elmahrek, A. (2014b, November 6). Is it the end of an era in Irvine politics? Voice of Orange County, http://ww.voiceofoc.org. "Irvine" Great Park: A Legacy of Hubris Elmahrek, A. (2015, February 19). Auditor sees bias in Irvine's Great Park investigation. http://voiceofoc.org. Ford, A. (2014, August 5). Orange County Great Park Corporation [Deposition]. Irvine, CA. Retrieved from: http://www.cityofirvine.org/cityhall/cityclerk/depositions.asp Fuscoe, P. (2014, July 14). Orange County Great Park Corporation [Deposition]. Irvine, CA. Retrieved from: http://www.cityofirvine.org/cityhall/cityclerk/depositions.asp Gaffen, Y. (2014, August 8). Orange County Great Park Corporation [Deposition]. San Diego, CA. Retrieved from: http://www.cityofirvine.org/cityhall/cityclerk/depositions.asp Gibbs Giden (2014). Orange County Great Park audit. Los Angeles, CA. Author. Great Park Corporation. (2007, August 9). Transcript from OCGP Board Meeting on August 9, 2007. Irvine, CA. Great Park Corporation. (2010, June 17). Notice of termination without cause of agreement for contract services for the Orange County Great Park for marketing and communication services (No. 7469) dated September 7, 2012. Irvine, CA. Great Park Corporation. (2013, January 10). Schematic design contract close-out. Irvine, CA. Great Park Conservancy. (n.d.). Foundation for the Great Park. http://www.orangecountygreatpark.org Hagan, Streiff, Newton, & Ohiro (HSNO). (2014). Orange County Great Park forensic contract performance review. Newport Beach, CA. Hagan, Streiff, Newton, & Ohiro (HSNO). (2015, March 23). Orange County Great Park forensic contract performance review. Newport Beach, CA. Irvine, City of. (2006a). Response of City of Irvine to Orange County Grand Jury 2005- 2006 Report ("The Orange County Great Park: Whose park is it"). Irvine, CA. Irvine, City of. (2006b). City Council Resolution No. 06-42: A resolution of the City Council of the City of Irvine restating and clarifying the governing structures and responsibilities relating to the Orange County Great Park. Irvine, CA. Irvine, City of. (2010a). Response of City of Irvine to Orange County Grand Jury 2009- 2010 Grand Jury Report dated June 3, 2010. Irvine, CA. Irvine, City of. (2010b, September 13). Agreement concerning close-out of schematic design contract. Irvine, CA. Irvine, City of. (2012a, August 14). Dismissal agreement in connection with State of California Department of Finance settlement negotiations by and between City of Irvine Successor Agency to the dissolved Redevelopment Agency and Irvine Community Land Trust. Irvine, CA. "Irvine" Great Park: A Legacy of Hubris Irvine, City of. (2012b). Heritage Fields Project 2012 GPA/ZC: Draft Second Supplemental Environmental Impact Report (DSSEIR). Irvine, CA. Irvine, City of. (2013a, March 26). Formation of community facilities district no. 2013-3. Irvine, CA. Irvine, City of. (2013b, November 11). Second agreement with City of Irvine as adjacent landowner (ALAII). Irvine, CA. Irvine, City of. (2013c, November 26). Irvine City Council meeting minutes. Irvine, CA. Irvine, City of. (2014, January 28). Resolution of the City Council of City of Irvine authorizing an investigation into the financial management of the Orange County Great Park, approving a scope of work for a forensic investigation, and authorizing the City Council subcommittee and retained special counsel to facilitate the investigation and issue subpoenas. Irvine, CA. Irvine, City of. (2014b, July 9). Settlement agreement and release of claims. Irvine, CA. Irvine, City of. (2014c). Accounts paid listing: 2012-2013. Irvine, CA. Irvine, City of. (2014d, March 18). Irvine City Council meeting minutes. Irvine, CA. Jow, L. (2014a, October 28). Irvine ballot measures: Great Park transparency, term limits. Orange County Register, p. L-4. Jow, L. (2014b, November 4). Irvine voters approve Great Park fiscal reform, term limits. Orange County Register. Retrieved from: http://www.ocregister.com Jow, L. (2014, November 6). Agran is out after 16 years; Republicans look set for Irvine supermajority. Orange County Register, pp. L1, L5. Joyce, S. (2014a, February 2). Memo: Reorganization plan. Irvine, CA Joyce, S. (2014b, July 18). Orange County Great Park Corporation [Deposition]. Irvine, CA. Retrieved from: http://www.cityofirvine.org/cityhall/cityclerk/depositions.asp King, T., & Butow, R. (2011, November 27). So far all the Orange County got was a big ugly balloon. Salem-News. Retrieved from http://www.salem-news.com Kogerman, W.G. (2014, June 26). Orange County Great Park Corporation [Deposition]. Newport Beach, CA. Retrieved from: http://www.cityofirvine.org/cityhall/cityclerk/depositions.asp Kohn, P.D. (2014, August 11). Orange County Great Park Corporation [Deposition]. Irvine, CA. Kreutzen, W. (2014, April 29). Orange County Great Park Corporation [Deposition]. Newport Beach, CA. Retrieved from: http://www.cityofirvine.org/cityhall/cityclerk/depositions.asp "Irvine" Great Park: A Legacy of Hubris Krom, B. (2006, September 13). Response of City of Irvine to Orange County Grand Jury 2005-2006 Report ("The Orange County Great Park: Whose Park Is It?"). City of Irvine, CA. Krom, B. (2015, April 19). Great park now about profits, not people. Orange County Register, Opinion 6. Landers, S. (2014, July 9). Orange County Great Park Corporation [Deposition]. Newport Beach, CA. Retrieved from: http://www.cityofirvine.org/cityhall/cityclerk/depositions.asp Lough, M. (2011). Design development quality management checklist. American Institute of Architects. New York. McDevitt, B. (2014, July 8). Orange County Great Park Corporation [Deposition]. Newport Beach, CA. Retrieved from: http://www.cityofirvine.org/cityhall/cityclerk/depositions.asp McDonnell, K. (2014, October 22). Orange County Great Park Corporation [Deposition]. Irvine, CA. Retrieved from: http://www.cityofirvine.org/cityhall/cityclerk/depositions.asp Maxwell-Miller, T. (2014, October 2). Orange County Great Park Corporation [Deposition]. Newport Beach, CA. Retrieved from: http://www.cityofirvine.org/cityhall/cityclerk/depositions.asp Mollrich, S. (2014, July 30). Orange County Great Park Corporation [Deposition]. Irvine, CA. Retrieved from: http://www.cityofirvine.org/cityhall/cityclerk/depositions.asp Mission Viejo, City of. (1988). Municipal Code Sec 2.08.070. Mission Viejo, CA. Orange County Great Park Corp. Board of Directors (2008, June 19). Agenda. Irvine, CA. Orange County Grand Jury Report. (2006). The Orange County Great Park: Whose park Is it? Santa Ana, CA. Orange County Great Park. (n.d.a.). History of land. Irvine, CA. Orange County Great Park Corp. (n.d.b.). FY 2009-2020: Strategic business plan. Irvine, CA. Orange County Grand Jury Report. (2010). Financing the Great Park: Now you see it, now you don't. Santa Ana, CA. Orange County (2002). Measure W: County Parks Initiative. Retrieved from: http://www.smartvoter.org/2002/03/05/ca/or/meas/W/.html Orange County Great Park Design Studio. (2007). Major milestone review: 30% schematic estimate construction elements. Irvine, CA. "Irvine" Great Park: A Legacy of Hubris Schulman, M. (n.d.). California without redevelopment monies: The ethical issues. Markkula Center for Applied Ethics, Santa Clara University, CA. Retrieved from http://www.scu.edu. Sim, R. (2005, March 14). Great Park Audit: Statement of Richard Sim to Conservancy. Irvine, CA. Sim, R. (2014, July 29). Orange County Great Park Corporation [Deposition]. Irvine, CA. Retrieved from: http://www.cityofirvine.org/cityhall/cityclerk/depositions.asp Smith, K. (2014, September 5). Deposition: Orange County Great Park. San Clemente, CA. Retrieved from: http://www.cityofirvine.org/cityhall/cityclerk/depositions.asp Smith, G. (n.d.). Declaration of Greg Smith regarding City of Irvine Great Park. Irvine, CA. Retrieved from: http://www.cityofirvine.org/cityhall/cityclerk/depositions.asp Starnes, J.L. (2014, June 30). Deposition: Orange County Great Park. Newport Beach, CA. Retrieved from: http://www.cityofirvine.org/cityhall/cityclerk/depositions.asp Urch, G.T. (2014, August 26). Orange County Great Park Corporation [Deposition]. Newport Beach, CA. Retrieved from: http://www.cityofirvine.org/cityhall/cityclerk/depositions.asp Wood, T. (2014, July 28). Arnold Forde: Half century of big time politics. Voice of Orange County, Retrieved from: http://ww.voiceofoc.org. Worthington, G. (n.d.). Declaration of Glen Worthington regarding City of Irvine Great Park. Irvine, CA "Irvine" Great Park: A Legacy of Hubris APPENDIX A: ORANGE COUNTY GREAT PARK CHRONOLOGY 1993 July Department of Defense places MCAS El Toro on the BRAC closure list. 2002, March 5 Orange County voters approve Measure W that creates the Orange County Central Park and Nature Preserve to replace MCAS El Toro. 2002, March 6 The Department of the Navy announces its intention to sell MCAS El Toro on a bid basis. 2003, January 28 Irvine City Council announces in a press release that the Great Park would cost a projected $353 million to construct. 2003, July 7 The Orange County Great Park is incorporated. 2003, November 12 The Local Agency Formation Commission (LAFCO) approves the City of Irvine's annexation of the former MCAS El Toro, putting the City of Irvine in control of land use decisions for the entire property. 2003, December 5 The Orange County Great Park Corporation (OCGPC) holds its first public meeting and adopts a resolution that expands the Board of Directors to nine (9) members. City of Irvine officially annexes former MCAS El Toro. 2004, January 14 The Department of the Navy invites bids for MCAS El Toro. 2004, September 2004, December 16 The OCGPC approves the 2004-2005 business plan with an anticipated budget to build the park at $401 million. 2005, March 8 Redevelopment funding for the Great Park is authorized by ordinance. The OCGPC inaugurates design contest for the Great Park. 2005, April 2005, June 23 Based on design submittals and recommendation by a "Design Jury," seven finalists are selected and each is given $50,000 to develop and Conceptual Master Design Plan. 2005, July 12 Lennar had the winning bid for MCAS El Toro of $649.5 million. Lennar contributes 1,347 acres to the City of Irvine, pays $200 million in developer fees, and pledges an additional $201 million for joint infrastructure and facilities intended to be funded by a Community Facilities District (CFD) bond sale. 2005, September Finalists present their design plans during the OCGPC public meetings. OCGPC board selects the project designer and architect of the Orange County 2006, January 23 Great Park. 2006, March 9 OCGPC enters into Agreement for Master Designer Services to develop a Great Park Master Plan for $372 million. The main purpose of the contract is to develop a conceptual design of the Great Park that would be approved by the OCGPC Board and the Irvine City Council. 2006, March 23 A contractor is selected from among five bidding firms to be the program manager for the Great Park. 2006, October 26 OCGPC Board approves the Preliminary Master Plan in concept. 2007, January 9 Irvine City Council authorizes approximately $4.1 million in expenditures for design, construction, operations, and insurance for the Great Park balloon. "Irvine" Great Park: A Legacy of Hubris Original plan designer makes proposal to OCGPC Board to continue services for 2007, January 25 the design development of the entire park, including park schematics, mass grading, and construction documents for the initial park construction. 2007, July 14 The Great Park Balloon opens to the public. Features include parking, lighting, temporary visitor center, construction of the observation balloon, and associated infrastructure and utilities. 2007, July 24 OCGPC Board and Irvine City Council approve a schematic design contract (Contract #5759) for $27.3 million. The purpose of the contract is to develop construction documents in accordance with the Master Design Plan and to establish reasonable cost estimates for the Great Park features included in the Schematic Design. 2007, September 27 The OCGPC Board adopts the Comprehensive Master Plan. Contractor estimates total cost to build park at $979.8 million. Irvine City Council authorizes $11.4 million for design and construction of the 2007, December 11 Balloon Enhancement Project and $2.5 million for first year operating costs, totaling $13.9 million. Features include new signage and lighting, parking and site access, night flights, a revised multipurpose 5-acre landscaping, and cleaning and painting an existing hangar that will be used for future events. 2008, January 8 Decision to proceed with the Schematic Design to ultimately develop construction documents for the improvements. 2008, March 25 Balloon Enhancement Project is expanded by Irvine City Council to become the 27.5-acre "Preview Park." Irvine budgets approximately $6.97 million for construction of the entire Preview Park. Balloon project is considered Phase One. 2008, July Second phase of Preview Park is completed. This phase consists of a lawn, trees, park furnishings, additional lighting, timeline prototype, shade structures, and a relocated and improved visitor center. 2008, July 11 Program Manager estimates the cost of horizontal construction (not including buildings) to be over $1.6 billion. 2008, August The City of Irvine hires an independent public accounting firm to audit contract compliance under the Agreement for Master Designer Services (Contract 1). 2009, January OCGP Board commissions consulting firm to evaluate the merits and feasibility of a major fundraising effort to generate private funds for selected facilities and programs within the Great Park Master Plan. 2009, February Schematic design is halted by CEO and states no further work necessary on the design. Staff concludes that the project budget to be approximately $1.4 billion. 2009, March 19 Contractor presents a 36-month construction plan to develop 500 acres for $61 million. OCGP Board votes to recommend that the Irvine City Council appropriate $61.2 2009, April 23 million for the 500-acre park from development proposal. Contractor presents Phase 1 plan of the 500-acre plan and attains an additional 2009, May 21 $4.7 million to implement Phase 1. 2009, July Phase 3 of the Preview Park is completed. Third phase included transplanting mature trees into the lawn area and the Farm and Food Lab. Accounting firm auditing contract compliance under the Agreement for Master 2009, October "Irvine" Great Park: A Legacy of Hubris Designer Services delivered their report. 2009, October 22 GP CEO submitted a proposal for $65.5 million to develop 200 acres (Western Sector) and to replace the 500-acre plan The proposal was approved by the OCGPC Board. This area is adjacent to Park Preview. 2009, November 10 The City of Irvine approves a sole source contract with WRNS Studio, an architectural firm, for $10.1 million for design and pre-construction services for the Western Sector. Construction design of Western Sector began shortly thereafter. 2009, November 12 Consulting firm delivered its report to the OCGP Board, concluding that it is infeasible to raise enough private funds to construct facilities for the Great Park due to many obstacles. 2010, June 17 A Close Out Agreement between the original designer and the City of Irvine is presented at a joint meeting with OCGPC and Irvine City Council. 2010, August 13 Final Close Out Agreement with the original designer and City of Irvine is executed. Governor Brown proposes statewide elimination of Redevelopment Agencies 2011, January (RDA) beginning with 2011-2012 budgets. 2011, June 15 California Legislature passes ABX1 26 which eliminates RDAs and sets up Successor Agencies and Oversight Boards to wind down dissolved RDAs. 2011, November An independent public accounting firm, is engaged by the City of Irvine to review contract compliance of the Schematic Design contract (Contract 2). 2012, June 7 Irvine enters into a contract with USS Cal Builders, Inc. for $22 million to complete construction of 30 acres of the Western Sector. 2012, June 21 Independent accounting firm delivered Schematic Design Contract Compliance Review to Board and city. The report did not reveal any significant or material findings. 2012, November City Council election was held resulting in the composition of the council being significantly changed. Four of the at-large members were dismissed. City Council cancelled the park public relations contract. 2013, January 2013, June 17 The City of Irvine retained Hagen, Streiff, Newton, & Oshiro Accountants, PC (HSNO) for $240,000 to perform a forensic audit of the planning, development, and construction of the Great Park. 2013, November The Prime Contractor proposed 688-acre park project to the Irvine City Council. City of Irvine readjusts its Master Plan and Design Review to be in concert with 2014, August the Prime Contractor proposal. The 5-year Master Plan for 688 acres is approved by the City Council. 2014, November "Irvine" Great Park: A Legacy of Hubris APPENDIX B: PROBLEMS WITH FORMER CONTRACTS The Grand Jury found many inconsistencies and problems in managing contracts involving the Great Park. An examination of the previous largest contracts revealed that many of them contained no deliverables or milestones. Several were open-ended, had minor oversights, and provided for no true safeguards. It seems that there was never an outside audit of finances or contracts. No-Bid Contracts. Very early in the life of the project, the 2005-2006 Grand Jury had recommended that "The Irvine City Council should review current practices involving no-bid contracts to ensure that appropriate business controls are in place to protect the citizens of the City of Irvine" (p. 11). In the response from the City of Irvine, they "wholly" disagreed with this finding. In the City's response they referenced the current policy on purchasing8 which they claimed they were following. However the practice of no-bid contracts continued over the years. In projects costing over $100,000, 29 of 83 (35%) were sole source contracts according to records from the Office of the Irvine City Clerk. This seems extraordinarily high; however, the law does not prohibit these contracts if they are for highly specialized services. As an example, the Western Sector was built with sole source contracts, but to management's credit, the project was completed within 10% of its budget ($69.9 million actual versus budgeted $65.5 million). Change Orders. A review of several contracts revealed an extensive use of change orders. These change orders allowed for additional expenditures. A cursory review determined that over $15 million was spent on change orders alone. The forensic auditor found strong evidence of a lack of definition of scope in contracts until after the work had begun (HSNO, 2014). Also found was significant confusion concerning scope of work. There were various testimonies in sworn dispositions that one contractor was performing work outside of its scope. Other testimony stated that the same contractor would begin work prior to the contract being approved. The magnitude of change orders indicated a lack of definition of scope of work or poor project management by the City. "Irvine" Great Park: A Legacy of Hubris APPENDIX C: CITY OF IRVINE ORGANIZATION CHART Residents of Irvine Orange County City Council Great Park Board of Directors City Manager Assistant City Assistant City Manager OCGP Manager Administrative Public Safety Services Department Department Community Public Development Communication Department City Clerk Community Services Department City Treasurer Public Works Department City Attorney "Irvine" Great Park: A Legacy of Hubris APPENDIX D: OCGP ORGANIZATION STRUCTURES Single Organization Staffing Structure (Approved by Irvine City Council) OCGP Board City Council RDA Executive City Manager Director (RDA) Assistant City Assistant City Manager/CEO Manager Deputy CEO/GM(CFO) City Departments Manager of Manager of Manager of Manager of Communications Engineering Planning Operations and Public Affairs "Irvine" Great Park: A Legacy of Hubris Traditional Structure (Rejected by Irvine City Council) Manager ofOperations DeputyCEO/GM (CFO) Operations and Maintenance Great Park Development Manager of Communications and Public Affair Development OCGP Board CEO/GM
Agency Responses 3
Government agencies' official responses to this report's findings and recommendations. Click on a response to see the structured breakdown.
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