Allevato, Reeve Come to Agreement Over Financial Audit Ad-Hoc Members

Mayor Sam Allevato on Tuesday withdrew his objections to the appointments made by a fellow city councilman for a special ad-hoc committee created to guide a forensic audit of specific city budgets.

Derek Reeve had selected residents Jim Reardon—a critic of the —and John Perry—a critic of the city's water operations. Allevato had previously declined to go along with the appointments, saying the ad-hoc committee members should be unbiased financial and accounting experts.

At an impasse, Allevato calledmorning. He and Reeve are members of the finance and budget subcommittee and the only council representatives to serve on the committee for the audit. At that meeting, several of Reardon and Perry's cohorts said the perception would be that the mayor was attempting to strong-arm his fellow council members and control the outcome of the audit.

"The reason for this meeting was to make the discussion transparent," Allevato said. "We have a disagreement, and reasonable minds can differ, and that’s why we’re here today."

There had been concerns that Allevato would attempt to change the classification of the committee from ad-hoc to mayoral, meaning it would no longer be subject to the state's open meeting laws.

That did not happen.

With support from other council members, including Larry Kramer and John Taylor, Allevato withdrew his opposition to Reardon and Perry at the end of the one-hour council meeting.

"The data will tell the story," said Taylor. But "I would ask those who are involved, if they don’t like the water department or the [redevelopment agency], that they leave those biases behind and look at this with an open mind."

All of the commenters ultimately relayed the same message: Allowing wider breadth of knowledge and diversity of opinion on the ad-hoc committee will allow for a more trusted outcome of the audit.

Perry, who spoke during the public-comments portion of the meeting, passed his résumé to the dais and reviewed his own financial expertise, including years spent as the chief financial officer of a school district, he said.

"I understand I was [an] unacceptable [candidate] because, one, I'm a bomb thrower and, two, I didn’t have the necessary qualifications … but you had no way of knowing what my qualifications are, so I’m releasing my résumé publicly," Perry told Allevato.

Upon ultimately agreeing with Reeve's appointments, Allevato said his appointments would include Raymond Miller, chair of San Juan Capistrano's Utilities Commission, and a certified public accountant.

The Utilities Commission met one hour before the City Council on Tuesday morning. Its members discussed the financial audit and agreed that the scope should be narrowly defined and should include the water and sewer departments.

"I believe the public scrutiny and the public’s expectation of transparency is going to increase, and I want to be able to cogently and accurately answer [the public's] questions," Commissioner Dan Merkle said. "I have concerns about a forensic audit, because if it’s not directed, we could spend 14 years ... go on endlessly and not productively."