← Auditor General Committee July 2, 2026
Good morning, everyone, and welcome to the Auditor General Committee meeting of Thursday, July 2nd, 2026. This meeting is being held in person and by electronic means. Committee members and the public may participate by either method. Any voting members joining electronically are reminded to enable video to confirm quorum. And thank you to those of you who are joining us online for doing so. This meeting is being live streamed on the city's website and YouTube. Meeting progress will be updated on X and threads at Van City Clerk. Though, oh, hang on, we've got a new script here. Due to new posting limits, updates will only cover essential items such as vote results. Okay. In case of an emergency requiring evacuation, there are two exits beyond the glass doors. and to the left. If the glass doors are blocked, please use one of the four additional exits within the chamber. Do not use the elevator. Please use the stairs. If you require assistance, please remain where you are, and security and staff will guide you to a safe location. As a reminder, defibrillator is available at the end of the hallway outside of chambers. We acknowledge that we are on the unceded homelands of the Musqueam, Squamish, and TTsleil-Waututh peoples. We thank them for having cared for this land and look forward to working with them in partnership as we continue to build this great city together. I'd also like to recognize the immense contributions of the City of Vancouver's team members who work hard every day to help make our city an incredible place to live, work, and play. Clerk, may we have the roll call, please?
Yes. Councillor Donvinato is in the chair. Councillor Kirby Young. Councillor Montague. Present. Councillor Klassen. Councillor Zhou. Present. External Advisory Liaison Archie G. Johnston.
Might be on mute.
I see you online, Archie.
We can see you, Archie.
External Advisory Liaison Charlene Taylor is not present and sends regrets. External Advisory Liaison Gordon Ruth. You have quorum, Chair Dominato.
And good morning and welcome Gordon in person. Have a nice time in person. Today we have one item on the agenda followed by our in-camera session. The committee is required to meet in camera later this morning. The reason and authority under the Vancouver Charter are listed in the agenda. Could someone please move a motion to move in camera? Moved and seconded. Any discussion? Hearing none, all in favor? And that carries. Thank you. So we'll move into our agenda items that are this morning. First of all, we have the June 2026 follow-up report status of previous audit recommendations. Just before we begin, are there any conflicts of interest?
Hearing, seeing none, we'll move directly to the presentation, which has roughly six slides, and I'll turn it over to our Auditor General, Mike McDonnell. He's here to present and to respond to any questions, and also accompanied by Lori Berndt, Deputy Auditor General. Thank you, Chair. I have a very brief presentation on the status of previous audit recommendations. If we could hop ahead to the next slide, please.
Thank you. Where my audits identify opportunities for improvement in the economy, efficiency, and or effectiveness of the city's operations, I make recommendations aimed at addressing root causes. As Auditor General, I, quite appropriately, have no ability to compel the city to implement my recommendations, but I do ask council to endorse them. And consistent with that approach, this committee's terms of reference require it to follow up on the status of audit recommendations, which I do on your behalf. This report is the sixth semi-annual publication to allow you to fulfill that obligation. I ask City Management to provide, in their own words, an update on the status of audit recommendations contained in eight of the ten audit reports that my office has publicly issued to date. As representations of management, I provide no assurance regarding the completeness or accuracy of these statements. Instead, I invite you to consider whether the City Management's plans to address audit recommendations are appropriate and whether the reported progress to date is plausible and adequate. City management is here to answer questions you may have. This committee's terms of reference also allow it to ask for evidence. That's up to you if you feel it's appropriate, and I'll facilitate any such request. Next slide, please. Auditor departments were asked to self-assess their progress under four categories, fully or substantially implemented, which I think is self-explanatory. The next category is alternative action taken. Taking action is both management's responsibility and its prerogative. If management can find alternate approaches that address the issues underlying a recommendation, I consider this both appropriate and a success. The fully or substantially implemented and alternative action taken categories are merged in the upcoming summary table as I consider both to represent completion. No further follow-up work will be conducted. Partially implemented means some work is underway, and no substantial action means the department has not yet taken action. This can, especially in early days, represent the fact that management needs to prioritize and there's often a logical order which actions should be taken and that actions for some recommendations take more time than for others. Next slide, please.
I'm pleased to see that of the 60 recommendations included in eight audit reports released publicly up to the end of 2025, the city reports having fully or substantially implemented 33 or 55% of them. Next slide, please. This represents a 22% improvement since the last previous follow-up in December. I'm also encouraged to see work advancing on nearly all other remaining recommendations. While I've done no work that would allow me to comment on the veracity of management's representations, I will say, nonetheless, it's gratifying to see audited departments report progress on all but three recommendations.
I look forward to seeing further progress in the next semi-annual follow-up report to be presented to Council in December of 2026. I do note at this juncture that this is the last AGC meeting in this council's term. I think we've had a fair bit of success, and this is a shared success. And I'd like to thank each and every one of you for your support of me and my team, the work that we've done over your term. So thank you. Go to the next slide, please. It's the end of my prepared remarks. I'm happy to take questions, though consistent with the purpose of the follow-up. I hope most will be directed towards management, several of whom are here with you today for that purpose. Thank you. Thank you very much. And yes, important to note that we do have city, VPD, park board staff in attendance to address any of the committee's questions. But first we'll start, if we have any questions, if there is any staff would like to provide any comments prior to going into questions.
Okay, seeing none. Any other staff comments?
I'm just asking, yeah, if staff and if any of the departments wish to provide any comments. Okay, seeing none, I will turn over to committee members and Vice Chair Kirby-Young for questions to the Auditor General or to staff. Go ahead, Councillor Kirby-Young.
Thanks very much, Sharon. Thanks for the overview. I have a question in one area, and I know this has been the subject of some discussion and work both by the Auditor General Committee as well as the ACCS, Arts, Culture, and Community Services Department, with respects to things like modernizing leases, the true cost of leases. I mean, there's been a number of intersections and work. On page 27, I know there's a recommendation about, with respect to nonprofit lease audit, and your recommendation was that the full value of the city's financial contribution to each operator For example, including lease grant and operating grant should be reported to council. But I understand from staff that they're saying they don't believe this to be viable and will only report at a portfolio level, which, if I'm going to understand that correctly, would not give council the ability to understand how much council and the city of Vancouver and the taxpayer are supporting an individual organization or operator only at a portfolio level. Can I get some perspective on that?
Thank you for the question. Margaret Witkins, General Manager, Arts, Culture, Community Services. Certainly recognize the importance of providing transparency related to operating and capital maintenance costs as well as the value of the in-kind grant at both the lease as well as the portfolio level. At the lease level, there is an estimate provided now as part of the council approval of each individual lease of both the operating and the capital costs as well as the value of the in-kind grant. In terms of actuals, because typically these are MPOs that may be co-located within multiple MPOs within the same building, sometimes drawing on different programmatic budget line items, there are kind of system limitations where it would be quite resource intensive to kind of track the actuals. at a lease level. And so at this point, the level that's being tracked at the lease level is an estimate that's included in the context of council's approval. And then annually, we would be reporting on the portfolio level as part of the grant impact report.
If we... Okay, I'm going to have a couple of follow-ups. If we are reporting... in the individual reports, why can't we roll that information up and report it annually overall versus at a portfolio level if we're already calculating it at the individual lease level?
We're calculating the estimate of the forecast of the operating and the capital costs at the least level, and then to kind of track that on an ongoing basis at a least level presents a kind of resourcing and system challenges. It would be quite manual.
To clarify my question, I just want to be very clear. I understand what you're saying. I may not agree, but I'm understanding it with respect to tracking the actuals, but why can't we roll up and report on an individual operator basis the estimates, for example?
Yes, we can do that. So am I understanding that you're seeking kind of at the MPO level where we've created an estimate to report on that in kind of a consolidated way?
Yes. Well, I mean, I think rather than having to comb through different reports and go back and forth, if we already track it and presumably have that information available in reports, I'm just wondering why we can't put it in a transparent way for the public. So they have a question about a particular operator. They know who is getting what. Or they can see, for example, does our support skew towards a few different organizations? Is it split across? Is there equity? Are organizations treated differently? How would they be able to get a view of that?
Yes, so that is something that we could consolidate as part of the grant impact report at a lease level.
Chair, can I move for a second round so I can keep going?
Certainly, yeah. Move for a second round, seconded by Councillor Claussen. Any discussion? All in favor?
Thanks. Maybe I can direct. Go ahead. And thanks for that, Margaret. Maybe I can direct the sort of that next part of that question to the Auditor General. Was your recommendation, do you have comments with respects to reporting individually on an estimate basis versus an actual?
Well, in a perfect world, we'd have actuals, but we don't live in a perfect world, and I believe there are some systemic limitations. There are some shared costs, I think, as Margaret mentioned, with respect to... And so, you know, some of the expenses would be, say, for a building which has more than one tenant. So there would be some arbitrary potentially allocations. So to say that it's an exact cost would probably be imprecise and wouldn't stand up to audit scrutiny. But I think having a justifiable or reasonable estimate would provide you with, I think, the information that you're looking for.
Okay, thanks.
As well as costs that are... known for sure. So like a grant dollar is a grant dollar. That's fairly easily measurable. The value of the lease can be fairly reasonably estimated. So it's the other pieces that might be a bit more. Thanks, Chair. That's my time. I can come back on. That's great. Thank you. I'm going to advance Representative Archie Johnston.
Thank you very much. I want to echo the comments about the... value of the the follow-up and i'm really glad to see the the reports very thorough and i'm glad to see the management acknowledging and accepting the responsibilities my question was in the same vein as counselor kirby young's comment on page 27 recommendation 10. and i'm glad to hear that there is sort of a maybe i'll call it a low-tech solution to the to the problem um where that the information can be pulled together and presented to council so that the information is available so my question i guess is is to um the auditor general is do you feel that this sort of perhaps lower tech solution it will be sufficient
Thank you for the question, Archie, and I believe that it would fulfill the spirit and intent of the recommendation to give council a reasonable idea on an entity-by-entity basis the level of support and funding that's being provided by Vancouver taxpayers.
Thank you. Archie, any further questions?
No, that's fine.
Thank you very much. Councillor Claassen, go ahead.
Thanks very much, and thanks to Auditor General and his team for producing a very good report here and a follow-up. Appreciate it. I just have a couple of questions for the Auditor General. Of the items that have had no substantial action, which one perhaps surprises you the most? That's a tough one.
I think some of the systemic issues underlying the recommendations that we've made to the Park Board on revenue management, I wouldn't say I was surprised, but I'm surprised the least because you can't make something up out of thin air. There haven't been the underlying financial systems that would allow The park board to simply go ahead and fulfill the recommendation new things had to be put together a higher level of granularity Needed to be created in financial systems, so it's not surprising that that's taking some time I'll just follow up similar question, but which of the on the ones that have not moved forward Do you think poses the greatest risk?
I think I think the notion of those recommendations with respect to understanding the finances behind the activities that the park board engages in, understanding if users are being charged the right amount, given the nature of the service, the level of appropriate taxpayer subsidy that should go for each of them. You need to have all that information in place to make those decisions. That information has never been there, so the decisions themselves would not be as well supported as I would think should be.
Thanks. And sort of last question for you is with regards to the infrastructure levy, in your view, is it just additional funding that's required or are there some potential systemic issues around governance and decision making that could be improved as well?
I think there were some underlying governance issues with respect to the... nature of the information that was going back to the park board from the city. The city in that sense was acting as an agent for the park board who had legal responsibility for those assets. I believe those issues are being addressed and put everyone in a position to better understand where the risks and challenges are. The infrastructure risk is not isolated though to recreation assets. It's a city-wide issue. I haven't looked at that in detail yet, but my understanding is that many of the issues are similar across the board, and there's really some tough decisions that are going to need to be made in the years ahead. Thank you. Those are my questions, Chair. Thank you. Thank you. Vice Chair Kirby Young, go ahead.
Okay, so just following up then, and maybe I'll start with the Auditor General on that last piece on the actual versus... estimate piece in your view it would be it would support greater transparency for the public if a report was provided even if included estimates but with the goal be over time to work towards actuals yes I would I would agree with that yes okay um Is this something you're aware of in terms of any other cities or municipalities? I don't know if any other members of the committee might have some experience knowing the deep background we have in this area that other municipalities are doing.
The range of practices varies significantly from city to city, although I must say our audit didn't look at a benchmarking study of what various cities are doing. I know the city has undertaken some benchmarking work. and that's fine. At the end of the day, though, when you're providing support to not-for-profit organizations, I would suggest that there's a broader landscape of comparators, not just other local governments, but other philanthropic organizations that do this full-time, and that that's really where best practice should be sought. not from other local governments who provide support for not-for-profit organizations amongst the myriad other things that they do.
Okay. Thanks very much. Chair, at the appropriate time, I'd like to move an amendment to the report when we get there.
Thank you. Thank you for that, Councillor Kirby-Young.
Seeing no one else on the queue for questions, we do not have any registered speakers. And per Section 5.16 of the Procedure By-law, no vote is necessary as this item is intended for information only. But I do note, Councillor Kirby-Young, you did want to move a motion.
I would. I would like to move receipt of the report together with an addition, which I've just emailed to the clerk. Okay. As long as my computer isn't suddenly... I'll move you to the main queue.
Oh, it went off. Thanks, Council Clawson.
This would follow standard language about receiving a report for information and would be an addition with respects to the item that we just discussed. And I'll let the clerks bring that up.
And I'll just check in and make sure that both Gordon and Archie can see that or have access to the amendments.
either on screen or via email. You can see it, Gordon, thanks. Arshi, can you see that amendment?
Yes, I can. Thank you.
Thank you. Go ahead, Vice Chair.
Thanks very much. So I'll read it out just so everybody has it as clear, and it would read following that the committee received the report for information and further that the AGC committee recommend that council direct staff further to recommendation number 10 for nonprofit leases, and there's an extra that in there, that annually staff compile and publicly report to council on the full value of the city's financial contribution to each operator. such as maintenance, lease grant, and operating grants to support fulsome accountability to the public. And further that, the goal over time would be to provide actual values versus estimates, but that pursuant to available data as processes are improved, such initial reports may include estimated amounts with respects to some shared costs, such as maintenance, that may be more challenging to compile.
Thank you for that. Can I get a seconder? Seconded by Councillor Custon. Clerks, do you want to send the amendment queue or the main queue because it was received? Main queue. Okay. So, the report has been moved for receipt along with the additional amendments that Vice Chair just spoke to. Been seconded by Councillor Clawson. Any discussion? And please put yourselves on the queue if you wish to speak to this.
So, Councillor Clawson, will you? Okay.
Go ahead, Councillor Clawson.
Yeah, just maybe a question to the mover of the motion. I appreciate her introduction of the motion, perhaps, what her ideal outcome of this information would be.
Okay, that's a point of information through me to you, Vice Chair.
To the Chair, thanks.
Sorry, my mic is having fun today. Thanks, Council Klaassen. I mean, the intention here is that there's sort of a clear annual report that is a great summary that the public can look at as opposed to having to go and comb through disparate reports to see if there's a question about a particular operator, perhaps are they in good standing or not. If somebody wants to look at and see how the city awards funds, how much typically different organizations receive, that they don't have to comb through and try to find one report that says, here's your value in kind for lease here's another for your operating grant and that we are actually pulling that information together not dissimilar actually if you think about it to the motion that council approved around council total compensation where all the information is publicly available but it's difficult to find and so we made a motion that that should all be in one report annually so that it is easy for the public to find it
Thanks very much.
And the other part to that, too, is I think it gives council a better picture as well, in addition to the public, when we're receiving these reports to understand how much an organization is getting. Sometimes it's very difficult. An organization could receive an operating grant, a lease. Maybe they're getting a space upgrading grant. Maybe they're getting a different arts and culture operating. It's very difficult to kind of have a look at and see are we having some degree of equity or how funds are being spread across throughout all the different streams.
Great. I'm prepared to support the amendment, and I realize that this is not intended to target a particular institution, but really to provide kind of transparency that allows both council and the public to have a bit more information available at their fingertips on an annual basis. So I'm happy to support this. Thanks very much.
Thank you for that, Councillor Cletson. Seeing no one else on the queue to comment, just a reminder that anyone joining us online, just to make sure you have your video enabled, which it looks like you do as per Section 14.13 of the Procedure By-law. And with that, I'm going to call the vote. I think we'll just do it online so it's registered, if we could do that.
Great.
To vote online, please. I'm trying, but it's not working. Is that it? Okay. Okay. Thank you, committee members. That passes unanimously. And that actually concludes our agenda for today. And so thank you, Dr. General. Thank you to staff for being here. Just a reminder that we will be moving into the Cascadia room for the in-camera portion of this meeting. Could I get a motion to adjourn? Moved by Councillor Klassen. Seconder? Councillor Zhou. All in favor? And that carries. Thank you. So just give us a couple of minutes, those of you online. There's another link for the in-camera meeting, and we'll transition to Cascadia, so maybe five minutes at most. Thank you.