Loading...
HomeMy WebLinkAboutAudit Reports - Public - Departmental Coordination Internal Audit - 9/11/2025 Audit | Tax | Advisory | Consulting An independent member of UHY International UHY Advisors Mid-Atlantic, Inc. 8601 Robert Fulton Drive, Suite 210 Columbia, MD 21046 uhy-us.com September 11, 2025 City of Glendale Audit Committee: We are pleased to present our internal audit report on Departmental Coordination of the Capital Improvement Plan (CIP) process as required by the City of Glendale’s (the City) FY25 Audit Plan. The internal audit objective was to assess how multiple departments interact on projects to determine the level of coordination and cooperation, identify reasons for delays, fixes, and communication or payment issues, and evaluate whether the City’s CIP budget is appropriately aligned with current needs and financial capacity. We have reviewed the results of our work with City management and appreciate the courtesy that was extended to us by its staff. Sincerely, Jack Reagan Managing Director UHY Advisors Mid-Atlantic, Inc. uhy-us.com City of Glendale Departmental Coordination Internal Audit September 11, 2025 City of Glendale – Departmental Coordination 3 Table of Contents Executive Summary ....................................................................................................................................... 5 Scope of Work ........................................................................................................................................... 5 Audit Results ............................................................................................................................................. 5 A. Governance and Communication ................................................................................................ 5 B. Procurement ................................................................................................................................ 5 C. Project Management ................................................................................................................... 5 D. Systems ........................................................................................................................................ 6 Recommendations .................................................................................................................................... 6 A. Governance and Communication Recommendations ................................................................. 6 B. Procurement Recommendations ................................................................................................. 7 C. Project Management Recommendations .................................................................................... 7 D. System Recommendations .......................................................................................................... 8 Audit Report ................................................................................................................................................ 10 Background ............................................................................................................................................. 10 Methodology ........................................................................................................................................... 10 Scope of Work ......................................................................................................................................... 10 Audit Results & Observations ................................................................................................................. 11 Governance and Miscommunication .................................................................................................. 11 Procurement ....................................................................................................................................... 12 Procurement Duration .................................................................................................................... 12 Procurement Method ..................................................................................................................... 12 Vendor Selection & Monitoring ...................................................................................................... 13 Project Management .......................................................................................................................... 13 Project Charter ................................................................................................................................ 13 Project Finance ................................................................................................................................ 14 Project Closeout .............................................................................................................................. 14 Key Performance Indicators (KPIs) .................................................................................................. 15 Systems ............................................................................................................................................... 16 City of Glendale – Departmental Coordination 4 Appendix A – City Staff Interviewed ........................................................................................................... 17 Appendix B – Engineering Management Responses ................................................................................... 18 City of Glendale – Departmental Coordination 5 Executive Summary As part of the City of Glendale’s (the City) FY25 Audit Plan, we conducted a performance audit to assess how various City departments interacted on Capital Improvement Plan (CIP) projects. The objective of the audit was to assess the collaboration and coordination among multiple departments on these projects, identify factors contributing to delays, necessary fixes, and issues related to communication or payments, and evaluate whether the City’s CIP budget is appropriately aligned with current needs and financial capacity. The Engineering Department is responsible for executing the City’s CIP and ensuring the effective management of major City projects throughout their lifecycle. Engineering collaborates with partner departments across the City to ensure the successful delivery of completed CIP projects. Scope of Work The scope of work included CIP projects that involved Engineering, Water Services, Parks & Recreation, Field Operations, Transportation, and Budget & Finance. The audit excluded departments that were not involved in inter-departmental coordination with Engineering for CIP projects. Interviews were conducted with management to gain an overview of the CIP process, understand stakeholder departments' roles, and the staff's responsibilities. Walkthroughs were performed to identify operational, compliance, and financial risks and internal controls, opportunities for improvement, and root causes of inefficiencies. The periods reviewed for operational testing of controls ranged from fiscal year 2024 to fiscal year 2025. Audit Results Overall, we identified opportunities for departmental coordination improvement across four key areas. A. Governance and Communication While Engineering developed the PM Lite Manual (the Manual) in response to prior audit findings, it does not include some critical components, such as guidance on financial reporting. Additionally, due to partner department staff turnover, the Manual has not been effectively communicated across some departments or updated since its release. B. Procurement The overall CIP procurement function presents several challenges to project delivery, including procurement durations, contract negotiation delays, absent vendor selection procedures, and informal vendor performance monitoring. These weaknesses collectively increase the risk of project inefficiencies, noncompliance with best practices, and reduced trust among departments and stakeholders. C. Project Management While the Engineering Department has formalized its project management practices for CIP projects, critical gaps affect project oversight, execution, and accountability. Specifically, project charters are not utilized as an active functional tool that would be expected in project management to guide City of Glendale – Departmental Coordination 6 execution; project budgets lack proper planning; financial reporting lacks transparency; project closeout processes are inconsistently followed; and key performance indicators are neither reasonably defined nor tracked. These deficiencies collectively increase the risk of project delays, budget overruns, ineffective resource use, missed warranty opportunities, project carryover, and reduced interdepartmental coordination. Without addressing these weaknesses, the City’s ability to deliver CIP projects efficiently, transparently, and within scope remains at risk. We also found significant underutilization of allocated CIP funds. For fiscal years 2021 – 2025, the City’s total CIP budget was $1,820,635,140. Engineering was responsible for delivering 60% of this budget, totaling $1,085,638,265. Engineering was able to deliver about 50% of that budget, spending $546,243,151. For projects managed outside of Engineering’s purview, the budget accounted for 40% of the total CIP, or $734,996,875, but only about 28% was expended ($202,592,642). D. Systems The Engineering Department currently relies on SmartSheet as its project management software and data platform; however, the system falls short of meeting the complex demands of managing the City’s CIP projects effectively. The software lacks critical features such as a comprehensive project dashboard view for real-time tracking, a centralized warranty repository, system integration, file backup, and advanced reporting capabilities. Without these features, Engineering faces significant challenges in maintaining project visibility and generating actionable insights, highlighting the need for a more powerful and integrated project management solution. Recommendations By implementing the recommendations below, the Engineering Department can reduce the risk of project inefficiencies and enhance its ability to deliver CIP projects transparently, on time, and within budget. A. Governance and Communication Recommendations The following are practical steps recommended to address the observations surrounding governance and communication: • Engineering should update the PM Lite Manual to include: o A financial reporting component that outlines expectations for project-level financial monitoring, including budget-to-actual tracking, carryover analysis, and documentation of budget modifications. o More clearly define partner departments' roles, responsibilities, and decision-making authority throughout a CIP project. This should include input from partner departments on what needs to occur during planning, execution, and closeout stages to ensure accountability and collaboration. • To ensure alignment across departments, Engineering should continue to execute its plan to distribute the Manual to all partner departments and relevant stakeholders as soon as possible. City of Glendale – Departmental Coordination 7 o It should also proceed with its Lunch and Learns to encourage dialogue with partner department management regarding the Manual, ensuring a consistent understanding of its content and expectations. o After training has been completed, each partner department and stakeholder should formally acknowledge, using a statement form, their understanding of the Manual’s expectations and commitment to abide by the guidelines agreed upon. • Engineering needs to implement an annual review process to ensure that policies and procedures, such as the Manual, are current and reflect updates to operations and local and state regulations. B. Procurement Recommendations Below are actionable recommendations that should be taken to address procurement observations: Procurement Duration – Establish a comprehensive procurement timeline tracking process that captures the full duration of the procurement lifecycle, from project charter initiation through City Council contract approval. This data will then be used to monitor performance against benchmarks, identify delays, and improve project scheduling and resource planning. Procurement Method – Enforce the use of a formal procurement plan for each CIP project to capture the selected procurement method, rationale for its selection, key procurement milestones, responsible parties, target timeframes, and anticipated risks or roadblocks. Vendor Selection & Monitoring • Establish formal, standardized criteria and procedures for vendor selection in the Manual to ensure fairness, transparency, and alignment with City procurement policies. This should include guidance on qualifications, evaluation criteria, scoring methods, and documentation requirements. • Develop and adopt procedures for systematic vendor performance evaluations, including regular assessments tied to contract milestones and completion. Require documentation of performance issues, resolutions, and feedback from all departments involved. Engineering and partner departments should have clearly defined roles in managing vendor performance, addressing disputes or concerns, and following escalation protocols. C. Project Management Recommendations Outlined below are recommended actions to effectively address the project management observations: Project Charters • Revise the project charter framework to include comprehensive project management elements, such as those listed below. This will ensure the charter serves as a living document that actively guides project execution rather than just a procedural checkbox. o Clearly defined scope and final outcome goals for each project o Defined communication protocols and escalation paths o Clearly identified departmental representatives and their contact information o Detailed roles and responsibilities for all departments involved and key stakeholders City of Glendale – Departmental Coordination 8 o Project timelines with milestones and critical path analysis o Documented next steps and decision points for follow-up Project Finance • Government Finance Officers Association (GFOA) guidance states that CIP budgets should align with project readiness and execution capacity. Partner departments should develop realistic financial projections for year-over-year CIP projects that consider funding sources, operational capabilities, carryovers, and data analytics to avoid overextending resources and ensure realistic spending and delivery timelines. o Once drafted, partner departments should work with Engineering to validate the reasonableness of the proposed budget for each CIP project to ensure it reflects actual conditions and shared priorities. • To improve financial reporting transparency and consistency, engineering and partner departments should implement a standardized financial reporting process for individual CIP projects that includes budget-to-actual comparisons, forecast updates, and explanations for exceeding budget and excessive carryover. Reports should be updated monthly and distributed to relevant stakeholders. Project Closeout • Enforce the project closeout procedures outlined in the Manual, including financial reconciliation, completion letters, warranty tracking, and other pertinent documentation of completed work. • Update the Manual to require closeout meetings for all CIP projects to discuss and document lessons learned, successes, and areas for improvement. Representatives from Engineering, partner departments, and key stakeholders should be included. Key Performance Indicators • Develop and adopt a set of shared and standardized KPIs to measure project performance. The KPIs should be specific, measurable, achievable, relevant, and time bound. KPI examples include the percent of projects with scope creep, measurement of creep itself, percent of projects delivered in the CIP year it was programmed for, scope cost vs. final cost, schedule adherence, cost variance, resource utilization, and contractor performance. o Assign responsibility to the Budget & CIP Administrator or Principal Engineer for collecting and reporting on KPIs and incorporating these metrics into regular management reviews to support continuous improvement and decision-making amongst departments. • Provide targeted project management training for Engineering and partner department project managers on best practices in project planning, proper use of project charters, financial reporting, and closeout. This will improve the coordination, accountability, and oversight of CIP projects between Engineering and partner departments. D. System Recommendations The City should consider investing in an enhanced project management platform to support the CIP with real-time updates, provide comprehensive dashboards and financial tracking, document control, and City of Glendale – Departmental Coordination 9 multi-user collaboration features. Strengthening the CIP project management system will improve transparency, accountability, and cross-departmental coordination throughout the project lifecycle. • Engineering should collaborate with Finance, IT, and partner departments to research and identify a suitable project management system, including both the RSOQ development process and evaluation phase. • In addition to the PM Lite Manual and project management training mentioned above, partner departments and project stakeholders should also receive user training for the selected system. City of Glendale – Departmental Coordination 10 Audit Report Background As part of the City’s Independent Internal Audit Program (IIAP) FY25 Audit Plan, UHY conducted a performance audit of the departmental coordination within the Capital Improvement Plan process. The Engineering Department is responsible for overseeing the City’s Capital Improvement Plan (CIP) by guiding major construction projects from inception to completion. Engineering actively collaborates with partner departments across the City to ensure projects are completed. As part of the FY2022 Audit Plan, Moss Adams LLP conducted an audit to evaluate the City ’s CIP. The objective was to assess the City’s capital planning, budgeting, forecasting, project identification, and programming practices for adherence to best practices, ability to meet the City’s needs and strategic goals, and efficiency and effectiveness. The objective of UHY’s performance audit was to assess the level of collaboration and coordination among departments involved in projects with Engineering. This included focusing on existing workflows to identify factors contributing to delays, necessary improvements, and issues related to communication and payments. Additionally, City management expressed concern about the “rightsizing” of the City ’s CIP, and as a result, we also evaluated the City ’s CIP budget to actual amounts spent. Methodology We conducted our internal audit procedures by the Institute of Internal Auditors’ (IIA) Global Internal Audit Standards (“Red Book”) and generally accepted government auditing standards (GAGAS), commonly referred to as the “Yellow Book.” Those standards require that we plan and perform the audit to obtain sufficient and appropriate evidence to provide a reasonable basis for our audit results and conclusions. We believe that the evidence obtained provides reasonable assurance of our audit results and conclusions based on the audit objective. We conducted our internal audit procedures through the lens of the comprehensive Committee of Sponsoring Organizations of the Treadway Commission (COSO) framework, its five components, and 17 internal control principles. The COSO framework also divides internal control objectives into three categories: operations, reporting, and compliance. The COSO framework provides an applied risk management approach to internal controls and aims to help organizations reduce fraud. Scope of Work The scope of work included CIP projects that involved Engineering, Water Services, Parks & Recreation, Field Operations, Transportation, and Budget & Finance. The audit excluded departments that were not involved in inter-departmental coordination with Engineering for CIP projects. Interviews were conducted with management to gain an overview of the CIP process, understand stakeholder departments' roles, and the staff's responsibilities. Walkthroughs were performed to identify operational, compliance, and financial risks and internal controls, opportunities for improvement, and City of Glendale – Departmental Coordination 11 root causes of inefficiencies. The time periods reviewed for operational testing of controls ranged from January 2024 to December 2024. We reviewed an assortment of documentation, including but not limited to: • FY 24 and FY25 CIP • FY 24 and FY25 Budget Book • PM Lite Manual • Project Charters • SmartSheet Tracker Audit Results & Observations Through interviews with Engineering and partnering departments and review of documentation, we observed that some components of the City ’s CIP process and departmental collaboration need additional improvement. Governance and Miscommunication The FY22 CIP audit identified that the City lacked formal policies and procedures to guide key aspects of the CIP. As a result, Engineering developed the Project Manager's Manual for the Procurement, Study, Design, and Construction of Capital Improvement Plan Projects, which the department refers to as the PM Lite Manual (the Manual). Our review found that the Manual contains key components such as project initiation, scheduling, progress communication, closure, and Engineering’s role and responsibilities. The expected responsibilities for partner departments are also embedded within the Manual. However, it does not include a financial reporting component that outlines what financial monitoring is essential for individual CIP project transparency and successful completion within budget. Additionally, some partner departments expressed that Engineering has not effectively communicated or distributed the Manual to better understand and collaborate on their expected roles and responsibilities in joint CIP projects. Engineering has held internal training sessions with some partner departments, which were accomplished through a “Lunch & Learn” initiative. Lastly, there is no evidence that the Manual has been reviewed or updated since it was published in November 2023. The Government Finance Officers Association's best practices recommend that governments establish and maintain formal policies and procedures for capital planning, which include financial oversight, role clarity, interdepartmental collaboration, and regular updates to policies and manuals to reflect current practices and risks. The Project Management Institute (PMI) standards also outline that project management frameworks should include defined roles and responsibilities of all stakeholders. The lack of financial reporting guidance for individual CIP projects may contribute to the budget overruns and carryovers experienced in the City’s overall CIP. If partner departments are not consulted on their expected roles and responsibilities when involved in a CIP project managed by Engineering, it will continue to lead to coordination gaps, accountability issues, and duplicative efforts. City of Glendale – Departmental Coordination 12 Procurement Procurement Duration Engineering’s Budget & CIP Administrator has been granted delegated authority by Finance for Title 34 procurement, which consists of public buildings and improvements per the Arizona Legislature. The Administrator utilizes an Excel spreadsheet to track the Request For Quotation (RFQ) procurement duration only from the date of vendor (Contractor) selection to the contract approval date by the City Council. For a sample of 5 projects, we compared the project charter start date to dates on Engineering’s RFQ spreadsheet and found that 3 of 5 projects had a procurement lead time that exceeded 60 days. The City's full RFQ process typically consists of sending notice to the City clerk, running an ad, running a second ad, pre-submittal, time to score, selecting a vendor, negotiating with the selected vendor, and contract approval by the City Council. Engineering considers the procurement process completed once a vendor is selected, which should typically take about 49 days. However, when considering all the procurement steps up to contract approval, the total procurement time can be up to 8 months. Procurement lead times and contract negotiation delays present challenges to timely project delivery. Without fully accounting for the complete procurement timeline from project charter initiation through City Council contract approval, the City may underestimate project schedules, misalign resources, and contribute to project delays, increased costs, and diminished coordination between partner departments. Procurement Method The Manual contains details of the pros and cons of each procurement method and includes a list of 20 criteria that should be considered when selecting the procurement method for specific projects. Using this information, we attempted to validate that the procurement method selected and documented in the project charter aligned with procurement policy guidelines. However, since the delivery methods used vary from project to project, we were unable to validate the procurement decision-making efforts for the projects sampled. A project procurement plan is also not currently documented as part of the project charters. The Manual’s Pre-Selection Activities section references a project procurement plan to be established as part of the Partner/Engineering project charter. Project teams also rely on informal judgment and experience without standardized guidance or documented justification for the chosen procurement approach. If a formal project procurement plan is not documented, the City risks inconsistent and potentially inappropriate procurement decisions. This lack of documentation reduces transparency and may lead to delays, inefficiencies, or noncompliance with City procurement expectations, ultimately impacting the timely and cost-effective delivery of capital projects. City of Glendale – Departmental Coordination 13 Vendor Selection & Monitoring Our review found that the Manual does not include guidance for vendor selection to ensure fairness and transparency. Additionally, formal vendor performance monitoring procedures to ensure contract compliance are absent. As a result, we could not validate that vendor selection and monitoring are done in compliance with the Manual or best practices. Engineering and partner departments should utilize a vendor management tool that tracks contract terms, end dates, and performance. Vendor and contract management best practices emphasize the need for systematic and documented performance evaluations to ensure quality, managed risk, and support informed procurement decisions. Vendor performance feedback is handled informally and only when significant issues arise, often through dialogue between Engineering and the partner department(s), potentially leading to disagreement. It is also unclear whether Procurement, which oversees Vendor Self-Service, maintains vendor performance tracking. The absence of explicit vendor selection guidelines creates a misalignment between Engineering and partner departments regarding acceptable practices for vendor selection. It also creates a risk for potential vendor favoritism, kickbacks, and vendor overload. Without systematic vendor monitoring and contract oversight, the City is at greater risk of awarding contracts to underperforming vendors, overlooking compliance issues, making uninformed future procurement decisions, and experiencing strained interdepartmental coordination. Project Management Effective project management is critical to the successful delivery of the City ’s CIP within budget and on time. Our review found gaps in key project areas such as project charters, financial reporting, and project closeout that can affect the execution and oversight of Engineering’s project management. Project Charter Engineering has implemented the use of project charters to kick off its responsibility of project management over a CIP project and to serve as a shared agreement among stakeholders. A project charter is completed as a procedural step in Engineering’s project management rather than used as a functional tool that guides project execution. As a result, we found that a sample of project charters did not include common project management elements such as defined communication protocols, clearly identified departmental representatives, roles and responsibilities for each department involved in the project, milestones, and documentation of next steps. Engineering defines a project charter as an interdepartmental agreement on project parameters such as scope, schedule, and budget. The use of project charters is a result of those parameters not being clearly communicated and agreed upon previously between Engineering and partner departments. Engineering did not intend for a project charter to serve as a robust and active project management tool. Failing to utilize a project charter as a dynamic tool incorporating essential project management elements increases risks that may impede project success and lead to inefficient resource use. Without City of Glendale – Departmental Coordination 14 clear roles, responsibilities, and communication channels, project stakeholders across departments struggle to work together effectively, impacting project productivity and morale. Project Finance There is a gap for financial transparency in CIP projects that limits the ability of Engineering to monitor and communicate financial performance with partner departments effectively. We reviewed 75 CIP projects involving Engineering and found that 11 (15%) were over budget before requesting additional funding approval. We also found that $166,002,131 was carried over from FY24 into FY25 for 14 project types. The five projects with the highest carryover totaled $34,240,057. Per Engineering’s tracking, four of the five projects had carryover exceeding 80% of their budget amounts. SmartSheet also did not include comprehensive financial updates, such as a budget-to-actual analysis; only high-level notes of payment applications were included. A standard process for monitoring and disclosing financial information by Engineering to project stakeholders throughout the project lifecycle is essential to ensure transparency, enable informed decision-making, and support proactive financial management. The audit team was unable to obtain documentation for budget modifications to fully assess the validity, accuracy, and process of budget modifications incorporated into the CIP. Engineering indicated that amounts documented on project charters are only an initial estimate of a project, and the City ultimately identifies funding that can be used to complete projects that exceed its budget. Rather, budget transfers are performed by partner departments so that actual expenditures do not exceed the original budgets approved by the City Council. Additionally, upon inquiry into the root causes of carryover amounts, Engineering and partner departments communicated that carryover amounts can be caused by various reasons, including misalignment between project timelines and funding cycles, budget overestimates leading to funds being unused in a fiscal year, inefficiencies in project execution, procurement bottlenecks, project scope changes, staff shortages, contractor availability, and funding constraints. The absence of a standardized financial disclosure process limits Engineering’s ability to consistently track budget changes, understand the underlying causes of carryover amounts, and communicate effectively with partner departments. As a result, project stakeholders may not have access to complete or timely financial information needed to support informed decision-making and ensure effective oversight of project budgets. This lack of financial visibility also results in budget inefficiencies, undetected inconsistencies, misaligned resource allocation, errors within final reporting, and diminished oversight of CIP project execution. Project Closeout Engineering’s project closeout process is either absent or inconsistently applied, as completion letters are not always obtained in a timely manner, and warranty information is not retained or shared with partner departments. City of Glendale – Departmental Coordination 15 The Manual indicates that the Engineering PM, consultant, and contractor should sign off on a final completion letter. A copy of the letter is to be placed in the project file, and the warranty will begin on the date indicated on the letter. The Manual also outlines project closeout: “After the project is accepted and the Consultant and Contractor have been paid, the PM may entertain a project closeout meeting with the Engineering and Partner Department representatives at the Engineering Department Director ’s direction. The purpose of this meeting will be to discuss the overall outcome of the project (issues, successes, and lessons applied to future projects). This meeting’s intent is to serve as an avenue for possible process improvements as well as a discussion of areas of success or areas of improvement that might be necessary, NOT to finger- point, etc.” Our review found that post-project collaboration is limited, as closeout meetings are optional rather than mandatory. Furthermore, the current process for managing warranties relies on Microsoft Outlook reminders to schedule inspections two years after project completion. The Outlook calendar invite includes a trigger and invites relevant City staff, consultants, and contractors. Multiple representatives from each stakeholder group are included to account for turnover, such as promotions, retirements, or resignations. While this approach ensures some continuity, no formal or centralized system is in place to verify warranty documentation or track maintenance logs to ensure timely warranty claims. Although Engineering has taken steps to improve the project closeout process, it remains inconsistent, which limits the ability of project stakeholders to capture and apply lessons learned to future projects. Without a formal project management software system, Engineering will continue to rely on Outlook and SmartSheet, which lack the functionality to serve as a centralized repository for warranty information. There is a risk that warranty claims may be missed or delayed, resulting in avoidable repair costs to the City. Key Performance Indicators (KPIs) The FY22 CIP audit found that the City had not developed a standardized annual CIP report to track progress and performance. As a result, Engineering identified three key metrics in their PM Lite Manual intended to demonstrate the department’s ability to deliver the CIP; however, the department does not currently track or monitor these metrics. The three Engineering metrics include: 1. 95% of invoices are processed within the department within 7 days. 2. 100% of projects are completed on time. 3. 95% of warranty inspections do not result in rework. Engineering does not have the appropriate tools to easily track, analyze, and report on department metrics. The KPIs referenced in the 2023 PM Lite Manual may benefit from clearer definitions and more attainable targets, as their current form may have led to a lack of motivation to track them. Without proper and relevant KPIs, Finance, Engineering, and partner departments are limited in their ability to objectively assess their performance in delivering CIP projects. Combined with the absence of tracking established metrics, Engineering does not have sufficient and reliable data to identify areas for improvement, demonstrate accountability, and ensure projects meet quality, timeliness, and financial City of Glendale – Departmental Coordination 16 goals. Ultimately, these gaps may reduce stakeholder confidence in Engineering’s project management effectiveness. Systems Engineering utilizes SmartSheet as its CIP project management software. We reviewed a sample of five projects to determine whether they were included and tracked in SmartSheet and found no exceptions. We found project progress to be documented at least monthly by Engineering, with editing restricted solely to Engineering and read-only access for partner departments. We also found SmartSheet to be an insufficient project management tool that limits detailed project timelines/milestones, comprehensive financial reporting, two-way communication and note documentation, and data-driven decision-making. Engineering should use a project management tool that better supports the City’s growing CIP and allows for a dashboard view of project progress, a centralized warranty repository, version control, file backup, integration with other systems, and advanced reporting capabilities. Due to funding limitations, Engineering has been unable to procure and implement more robust project management software that would allow for improved transparency, accountability, collaboration, and effective communication channels. Without the appropriate tools, project stakeholders are unable to readily assess project performance, identify areas for improvement, and strengthen real-time collaboration and two-way communication. City of Glendale – Departmental Coordination 17 Appendix A – City Staff Interviewed 1 Donald Bessler, Director, Engineering Department (now retired) *Ron Serio, Director, Water Services Department *John Kennedy, Director, Parks & Recreation Department *Michelle Woytenko, Director, Field Operations Department Levi Gibson, Director, Budget and Finance Department *Purab Adabala, Director, Transportation Department *John Murphey, Administrator Budget & CIP, Engineering Department *Tom Kaczmarowski, Principal Engineer, Engineering Department *John Henny, Deputy Director, Water Services Department *Mark Roye, Deputy Director, Water Services Department *Stephen Acquafredda, Principal Engineer, Water Services Department *Jenny Doyle, Senior Civil Engineer, Water Services Department *Heidi Barriga, Deputy Director, Parks & Recreation Department *Michael Keane, Assistant Director, Parks & Recreation Department *Daren Frank, Deputy Director, Field Operations Department *Michael Carr, Deputy Director, Field Operations – Landfill *Craig Croner, Deputy Director, Field Operations – Fleet *Jonathan Hill, Budget Administrator, Budget and Finance Department Vision CIG (Capital Improvement Glendale) Team Members not already listed Jamsheed Mehta, Assistant City Manager, City Manager’s Office Djordje Pavlovic, Director, Engineering Gene Haranczak, CIP/Engineering Project Manager, Engineering Jonathan Flatt, Admin-Civil Engineer, Engineering Tangella Diaz, Admin-Real Estate, Engineering Jenny Durda, Director, Organizational Performance Jeff Bratcher, Organizational Performance Officer, Organizational Performance Stephen Gushue, Business Intelligence & Analytics Officer, Organizational Performance Fred Sanchez, CIP/Engineering Project Manager, Parks & Recreation Julian Reyes, CIP/Engineering Project Manager, Parks & Recreation Sam Chiovari, Superintendent, Parks & Recreation Tony Abbo, Deputy Director, Transportation Matt Smith, Airport Administrator, Transportation Javier Gurrola, Principal Engineer, Transportation Erin Steffa, Financial Analyst, Transportation 1 Staff with * next to their names are part of the Vision CIG Team City of Glendale – Departmental Coordination 18 Appendix B – Engineering Management Responses RE: Management’s Corrective Action Plan Departmental Coordination Internal Audit Recommendation(s) # Description Audit Report Page Accept/ Decline Responsible Person’s Name/Title Completion Date A Governance and Communication • Engineering should update the PM Lite Manual to include: o A financial reporting component that outlines expectations for project-level financial monitoring, including budget-to- actual tracking, carryover analysis, and documentation of budget modifications. o More clearly define partner departments' roles, responsibilities, and decision- making authority throughout a CIP project. This should include input from partner departments on what needs to occur during planning, execution, and closeout stages to ensure accountability and collaboration. • To ensure alignment across departments, Engineering should execute its plan to distribute the Manual to all partner departments and relevant stakeholders as soon as possible. o It should also proceed with its Lunch and Learns to begin a dialogue with partner department management regarding the Manual, ensuring a consistent understanding of its content and expectations. o After training has been completed, each partner department and stakeholder should formally acknowledge, using a statement form, their understanding of the Manual’s 10 A1.1 - accept A1.2 - accept A2.1 - accept A2.1.1 – accept with modifications A2.1.2 – decline Vision CIG Team 7/31/2026 City of Glendale – Departmental Coordination 19 expectations and commitment to abide by the guidelines agreed upon. • Engineering needs to implement an annual review process to ensure that policies and procedures, such as the Manual, are current and reflect updates to operations and local and state regulations. A2.1.3 – accept with modifications Action Plan: A1.1-2. A Lean Project to improve coordination, communication, and partnership between all departments who participate in the CIP has been initiated. One of the tasks of this Lean Project team, now called Vision CIG (Capital Improvements for Glendale), is to respond to the audit findings and subsequently have the Engineering Department update the manual. The team has agreed that financial reporting standards should be included in each project charter and will be added to the PM Lite Manual at a high level. The team also identified a gap in communication standards and details about project execution. A major focus of the Vision CIG Team is to clearly define all department responsibilities and decision-making authority. A2.1. This recommendation has been implemented. All departments have been provided a copy of the PM Lite Manual for their review. Additionally, the Vision CIG team will conduct a thorough review, make updates, and distribute future revisions as needed. A2.1.1 – 3. The Vision CIG Team has determined that two annual workshops will be held, one a past year review and at least one training. The annual review will be held in late summer to review the past year and determine how collaboration can be improved. The team will document lessons learned, coordinate CIP Lite Manual updates, and determine what CIP-related training(s) need to occur in the coming year. Training sessions will be hosted by Engineering and partner departments may assist in trainer or presenter roles. The “Lunch and Learn” format will continue as the primary method of training delivery. A2.1.2. Given the decision to add an annual workshop that includes a manual review process, the Vision CIG Team does not feel that an acknowledgement form is necessary or value-added. However, a sign in sheet may be utilized during the workshops and training sessions to ensure follow-up information is provided to key stakeholders as necessary. City of Glendale – Departmental Coordination 20 B Procurement • Establish a comprehensive procurement timeline tracking process that captures the full duration of the procurement lifecycle, from project charter initiation through City Council contract approval. This data will then be used to monitor performance against benchmarks, identify delays, and improve project scheduling and resource planning. • Enforce the use of a formal procurement plan for each CIP project to capture the selected procurement method, rationale for its selection, key procurement milestones, responsible parties, target timeframes, and anticipated risks or roadblocks. • Establish formal, standardized criteria and procedures for vendor selection in the Manual to ensure fairness, transparency, and alignment with City procurement policies. This should include guidance on qualifications, evaluation criteria, scoring methods, and documentation requirements. • Develop and adopt procedures for systematic vendor performance evaluations, including regular assessments tied to contract milestones and completion. Require documentation of performance issues, resolutions, and feedback from all involved departments. Engineering and partner departments should have clearly defined roles in managing vendor performance, addressing disputes or concerns, and following escalation protocols. 11 – 12 B1 - Accept B2 - Accept B3 - Accept B4 - Accept Vision CIG Team 07/31/2026 B1. The Vision CIG Team will work with Engineering to further define the existing CIP procurement timeline, negotiations, including clearly identified milestones and accountability, for inclusion in the project charter. These standards and procedures will also be updated within the PM Lite Manual. Finally, the Vision CIG Team will evaluate automated dashboard options to provide project team City of Glendale – Departmental Coordination 21 members with real-time visibility into project timelines, critical paths, current status, and potential delays. B2. A formal procurement plan will be established by the project team as part of the project charter process with partner departments. The Engineering department will ensure compliance with applicable procurement rules, standards, and Arizona statutes. B3. Within the PM Lite Manual, the Vision CIG Team will define formal, standardized criteria and procedures for vendor selections in compliance with city procurement rules and standards. Focus areas include: the balance of staff on vendor selection committees, vendor selection criteria, JOC contractor selection, and the equitable spread of spend-to-date work amongst contracted firms, as appropriate or justified. B4. The Vision CIG Team will review current vendor selection and evaluation methodologies within Engineering and partner departments to establish a standardized approach that can be adjusted as needed based on specific project needs. The team will evaluate best practices, such as Results Driven Contracting, to improve contractor performance. C Project Management • Revise the project charter framework to include comprehensive project management elements, such as those listed below. This will ensure the charter serves as a living document that actively guides project execution rather than just a procedural checkbox. o Clearly defined scope and final outcome goals for each project o Defined communication protocols and escalation paths o Clearly identified departmental representatives and their contact information o Detailed roles and responsibilities for all involved departments and key stakeholders o Project timelines with milestones and critical path analysis o Documented next steps and decision points for follow-up • Government Finance Officers Association (GFOA) guidance states that CIP budgets should align with project readiness and execution capacity. Partner departments 12 – 14 C1 – Accept with clarification C2 Accept Vision CIG Team Vision CIG Team 7/31/2026 City of Glendale – Departmental Coordination 22 should develop realistic financial projections for year-over-year CIP projects that consider funding sources, operational capabilities, carryovers, and data analytics to avoid overextending resources and ensure realistic spending and delivery timelines. Once drafted, partner departments should work with Engineering to validate the reasonableness of the proposed budget for each CIP project to ensure it reflects actual conditions and shared priorities. • To improve financial reporting transparency and consistency, Engineering and partner departments should implement a standardized financial reporting process for individual CIP projects that includes budget-to-actual comparisons, forecast updates, and explanations for exceeding budget and excessive carryover. Reports should be updated monthly and distributed to relevant stakeholders. • Enforce the project closeout procedures outlined in the Manual, including financial reconciliation, completion letters, warranty tracking, and other pertinent documentation of completed work. • Update the Manual to require closeout meetings for all CIP projects to discuss and document lessons learned, successes, and areas for improvement. Representatives from Engineering, partner departments, and key stakeholders should be included. • Develop and adopt a set of shared and standardized KPIs to measure project performance. The KPIs should be specific, measurable, achievable, relevant, and time bound. KPI examples include the percent of projects with scope creep, measurement of creep itself, percent C3 - Accept C4 - Accept C5 - Accept C6 - Accept Vision CIG Team Vision CIG Team Vision CIG Team Vision CIG Team City of Glendale – Departmental Coordination 23 of projects delivered in the CIP year it was programmed for, scope cost vs. final cost, schedule adherence, cost variance, resource utilization, and contractor performance. o Assign responsibility to the Budget & CIP Administrator or Principal Engineer for collecting and reporting on KPIs and incorporating these metrics into regular management reviews to support continuous improvement and decision- making amongst departments. • Provide targeted project management training for Engineering and partner department project managers on best practices in project planning, proper use of project charters, financial reporting, and closeout. This will improve the coordination, accountability, and oversight of CIP projects between Engineering and partner departments. C7 - Accept Engineering Leadership Action Plan: C1.1. The Vision CIG Team agrees that revising project charter elements, such as the project scope, would be beneficial. However, the team also recognizes that establishing a clear process for refining the scope after initial research is more critical to a project’s overall success than attempting to fully define the scope prior to initiating research or securing resources. The Vision CIG Team will evaluate when and to what level of detail, scope refinement should occur. C1.2. As part of the Lean Project, the Vision CIG Team will ensure that the project charter communication plan is updated and includes a template with robust communication protocols and escalation paths. C1.3. As part of the Lean Project, the CIG Team will expand the charter’s Department Representatives Section to ensure that all key stakeholders are included and provide more detail on roles and responsibilities, referencing the PM Lite Manual where necessary. An “opt in or out” method for all CIP Projects will be implemented, allowing each department to indicate whether they or a vendor they work with, should collaborate on any particular project. C1.4 The project timeline section will be enhanced, with an agreed upon methodology for revising the timeline as the project moves forward. C1.5 A standardized template will be included in the project charter to document routine next steps as well as unique, project-specific requirements, with clearly assigned tasks and targeted completion dates. City of Glendale – Departmental Coordination 24 C2. The first phase of the Lean Project is focused on CIP project execution; upon completion, the second phase of the project will follow and focus on improving CIP budgeting, planning, and financial projections to improve efficiency and alignment with execution capacity. C3. CIP financial reporting currently lacks consistency across departments; the Lean Project will identify best practices and evaluate standardized, automated reporting and dashboard tools to provide timely, consistent financial visibility for all departments. C4. To ensure project closeout procedures are consistently followed, the team will review and enhance current procedures, including financial reconciliation, completion letters, warranty tracking, capital asset documentation, and a robust maintenance turnover process. C5. As part of the Lean Project, the team will determine a standardized process for CIP project closeout meetings, incorporating best practices for after-action reviews to document lessons learned, successes, and areas for improvement, with participation from Engineering, partner departments, and key stakeholders. C6.1. The Vision CIG Team will develop and adopt a set of shared, standardized KPIs to measure CIP project performance, including both overarching program and project-specific measures. The KPIs shall account for differences between functional areas, balance project quality versus output, and remain flexible to meet stakeholder needs. C6.2. The Department of Engineering will serve as the primary custodian for the reporting of CIP Key Performance Indicators (KPIs). Project Teams will collaborate on data collection, analysis, and management reviews to support CIP continuous improvement. C7. Engineering has already begun scheduling of professional development sessions for Engineering Project Managers. Partner departments’ Project Managers will also complete project management training. D Systems The City should consider investing in an enhanced project management platform to support the CIP with real-time updates, provide comprehensive dashboards and financial tracking, document control, and multi-user collaboration features. Strengthening the CIP project management system will improve transparency, accountability, and cross-departmental coordination throughout the project lifecycle. •Engineering should collaborate with Finance, IT, and partner departments to research and identify a suitable project management system, including both the RSOQ 15 Accept Engineering, Finance, IT Directors As part of the FY 27 Budget process City of Glendale – Departmental Coordination 25 development process and evaluation phase. •In addition to the project management training mentioned above, partner departments and project stakeholders should also receive user training for the selected system. Action Plan: D1.1 The Vision CIG Team will conduct a thorough needs assessment of the current project management platform to validate system requirements to identify a software solution to best support our processes. The software of choice should allow for efficient and timely input of information by users, streamline cross-departmental coordination, and improve tracking of purchase order spending throughout the project lifecycle to enhance transparency and accountability. D1.2. If a new project management platform is deemed necessary, Engineering will serve as the lead for the software procurement effort, collaborating with Finance, IT, and partner departments throughout the requisition and evaluation phases to identify a viable project management system. D1.3. Engineering, in coordination with Finance and IT, will ensure that all partner departments and other key stakeholders that require system access receive the appropriate level of system training during the integration phase. Engineering is already reviewing current access to see where additional access is needed for partner departments.