After publicly sparring for months over a proposed overhaul of the city’s financial structure, Denver’s mayor and city auditor said Thursday that they had settled their differences.
Under the agreed-upon overhaul, accounting and payroll functions will be removed from the auditor’s office and placed under a new chief financial officer.
The auditor’s office will retain the right to conduct performance audits on agencies and to hold up contracts by refusing to sign off on them.
“We have come to a consensus on the appropriate way to both modernize the city’s financial structure and at the same time maintain the critical checks and balances that any good government requires,” Denver Mayor John Hickenlooper said during a news conference in front of the City and County Building with Auditor Dennis Gallagher.
On Monday, Gallagher blasted an earlier version of the restructuring as a “power grab” and had vowed to fight it. But on Thursday, he said, “I, too, want to join the mayor in commending a process that finally came forward with something very good and that we can support.”
The proposal emerged from the Mayor’s Financial Management Task Force, which the mayor appointed to address concerns raised by companies such as KPMG LLP, the city’s external auditor.
KPMG had suggested centralizing the city’s financial responsibilities under the mayor. Currently, five agencies share those responsibilities.
The proposal will go to the full City Council on Monday. If the council approves, it will go to the voters in November.
Gallagher’s spokesman, Denis Berckefeldt, said the mayor’s office made compromises that assuaged Gallagher’s concerns. A version the mayor’s office was pushing Monday would have required the City Council to sign off on the auditor’s annual performance audit schedule.
Under the newer version, the auditor only submits that plan “for informational purposes” to an audit committee, composed of appointees from the mayor, the auditor and the council. Gallagher will serve as chairman of the audit committee.
“We were especially pleased to see that the auditor could not be told or have a veto over what he or she audits,” Gallagher said.
The City Council also will consider an ordinance that specifies the auditor retains his right to audit the payments workers receive when they leave city employment. It also will reaffirm the auditor’s authority to ensure that contractors doing business with the city are paying prevailing wages.
The ordinance will limit to five working days the auditor’s ability to block a contract by refusing to sign it. The audit committee will work out further language regarding the auditor’s ability to block a contract and requiring his signature only on contracts that reach a certain monetary threshold.
Staff writer Christopher N. Osher can be reached at 303-820-1747 or cosher@denverpost.com.
