Fresno City Council considers audit of credit card spending

The Fresno City Council may consider an audit of citywide finances rather than just council credit card use after one councilmember last week blasted his colleagues’ use of their city budgets.

A finance and audit subcommittee of the City Council met during a special meeting Wednesday to discuss the purpose and scope of audits and a number of financial policies. The city manager, mayor, and finance director joined the three-member committee of councilmembers during the meeting.

The meeting was a response to Councilmember Garry Bredfeld’s news conference last week in which he slammed certain councilmembers’ credit card use and called for an audit.

Bredefeld criticized purchases made on the taxpayer dime by Councilmembers Miguel Arias, Nelson Esparza, Tyler Maxwell, and Esmeralda Soria. While Councilmembers Luis Chavez and Mike Karbassi used their city budgets and credit cards similarly, Bredefeld argued their spending wasn’t as egregious as the other four. Bredefeld does not use a city credit card.

The audit committee consists of Arias, Esparza, and Maxwell. During Wednesday’s meeting, they each said they’re open to being audited by an independent third-party auditor but staunchly opposed any audit that would be muddied by politics.

“A big challenge facing City Hall right now is going to be restoring the public’s trust. We can do that by taking appropriate steps toward making City Hall finances more transparent, not just now, but going forward as well,” Maxwell said. “…What I do not agree with is a politically-motivated audit led by a single council member that only focuses on the expenses of four city council members he disagrees with. … Let’s take the politics out of it. I’m in favor of an independent audit of our entire city’s finances and efficiency, including credit card usage, staff time.”

During Wednesday’s meeting, Finance Director and City Controller Michael Lima said the price for the city’s annual financial statement audit is around $160,000. The cost goes up if the scope and number of years rise, he said.

Lima told the committee 79 people hold city credit cards, and about 12-14 of those are for city councilmembers and their staff. The city began regularly issuing credit cards to city staff about five years ago under former Mayor Lee Brand’s administration, and credit card use has significantly increased as the financial environment relies more on the Internet, he said.

City Manager Georgeanne White said that the council might want to consider some policy changes to how credit cards and city council budgets are used.

“I think what we’re seeing is a result of a philosophical shift of this body,” White said. “The policies that we have now are very traditional. The definition of city business has been essentially business that benefits the entity — the city of Fresno as a business entity. I think what I hear is, at least from several of you, that your definition may be different than that. I don’t know that that’s wrong, or if that’s right, it’s just different. Our policies don’t really jive with some of the things that you define as a priority for city business.”

The expenditures Bredefeld raised may not be consistent with those city “business” spending policies, White said. In the past, the city used nonprofits to fund items that weren’t consistent with city business or city policy, she said. She used Mayor Jerry Dyer’s One Fresno Foundation as an example.

Esparza said he foresees two or three phases moving forward, including conducting the initial audit or financial review and then using those findings to inform any policy changes.

“I believe my colleagues and I on the finance/audit committee have made significant strides today in clarifying what we as a city can do moving forward to ensure we are being transparent to the taxpayer,” Esparza said. “I look forward to discussing with the rest of my colleagues on the city council a comprehensive audit of city finances that takes into account the context of city spending over the years.”

Bredefeld sat in the audience of the council chambers during the meeting. Afterward, he said the meeting showed that Arias, Esparza, and Maxwell support big government.

“Last week, I revealed with documentation that these three councilmembers were using their $700,000 operating budgets as personal and political slush funds. They know their corruption was exposed, and so today they tried covering for each other by not only supporting my call for an audit but also expanding it during their quickly called emergency finance meeting,” Bredefeld said. “These are big government, tax-and-spend radicals who have misused and wasted hard-earned taxpayer money. They know the days of using their budgets as slush funds is quickly coming to an end.”

The full Fresno City Council on Thursday will consider two proposals Bredefeld made, including the audit. Bredefeld also proposed revoking all credit cards issued to city councilmembers and their staff.

This story was originally published March 23, 2022 5:17 PM.

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Brianna Calix covers Fresno City Hall for The Bee, where she works to hold public officials accountable and shine a light on issues that deeply affect residents’ lives. She previously worked for The Bee’s sister paper, the Merced Sun-Star, and earned her bachelor’s degree from Fresno State.

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