Kroll report discloses financial mismanagement
Tuesday, August 8, 2006
Arthur Levitt, former FCC Chair and head of the consultants who conducted the investigation said the City's pension system has been debilitated by years of reckless mismanagement.
He said that though the city and the pension board acted illegally and improperly, officials did not set out with the intention of defying the law. Rather, he said, the failure was a cultural failure, based on lack of transparency and denial of fiscal responsibility.
The consultants recommend remediation measures, some of which could prove costly to the city. An independent monitor should be hired to oversee the city's compliance for the next three years.
Most importantly, the city's outside auditor, KPMG, said that report is sufficient for them to complete their audit, though they gave no guaranteed timeline.
The council accepted the report, but City Attorney Mike Aguirre is grilling the consultant, since he fears the report will undermine his attempt to roll back benefits. Alison St. John, KPBS News.
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