In January 2013, the Irvine City Council, acting upon a motion by Councilwoman Christina Shea, voted to spend up to $250,000 on a “compliance/forensic audit” of the Orange County Great Park for the years 2005-2012. Curiously, this so-called “independent” forensic audit was to be under the supervision and direction of a two-member Council “subcommittee” consisting of Councilmembers Christina Shea and Jeff Lalloway. None of the remaining Councilmembers were to receive information developed by the “audit” until the information was publicly disclosed. The cost of the audit was to be no more than $250,000 — a pricey amount that dwarfed the cost of more than a half-dozen previous Great Park audits during the same 2005-2012 period.
One year later, in January 2014, the accounting firm selected to handle the audit, HSNO, presented a “preliminary report” of their findings. The report contained numerous errors — the most obvious of these errors was the claim by the accountants that $38 million in Great Park funds was “missing.” In fact, the $38 million was safe and secure with the City of Irvine. As mandated by State law, these funds were transferred from the books of the Great Park to the City of Irvine to be held in a special housing set-aside fund. If the auditors had bothered to simply ask the City Manager, this legally required transfer would have been easily confirmed, sparing HSNO, the Shea-Lalloway subcommittee, and the City the embarrassment of such a gross error.
Yet, a majority of the City Council decided to proceed further with HSNO — these same incompetent accountants and auditors. Since January 2014, the cost of the “audit” has ballooned to over $1.5 million, with more than 20 depositions taken.
Complaints against the audit and the auditors have been filed with the California Board of Accountancy and the California Attorney General. In addition, State legislative committees in Sacramento are considering a request by lawmakers to direct independent State auditors to “audit the Great Park audit” to identify audit improprieties and the possible misuse of public funds for political purposes.
Irvine Community News and Views has received numerous written and verbal criticisms of this so-called “audit.” Most of these communications angrily question how this “forensic audit” has turned into an expensive, publicly-funded political witch hunt, generating outright falsehoods which were used in the last City election.
Since this entire “audit” process has been short on facts and long on politics, ICNV has refrained from reporting on the political machinations. This does not mean that we are not following the story. On the contrary, future ICNV articles will review the Great Park audit, its findings, and related materials for veracity. We will investigate any misuse of public funds for political purposes, which would be a violation of State law. We will also look into allegations that the accountants, auditors, lawyers and related others involved in this “audit” may have themselves been aiding the politicians who provided them $1.5 million in taxpayer funds.