Wednesday, March 4, 2026, 9:30 a.m. (Austin time), Austin City Hall, 301 W 2nd St, Austin, TX 78701
Committee: Audit and Finance Committee
0:02 Good morning, everybody. It's nine 30 in the morning on March 4th, 2026, and I will call to order the
0:08 audit and finance committee of the Austin City Council.
0:12 We are meeting in the council chambers, which are located at City Hall at 3 0 1 west second street
0:18 in Austin, texas. And we have all of the members of the committee present.
0:24 Um, members, we're just going to go through the order as it's laid out in the agenda, and
0:30 I will, uh, first turn and ask if we, uh, I know we have public comment and ask
0:36 you to please call the names of the, uh, people that have signed up to speak when she
0:40 calls your names. By the way, please come forward and go ahead and take a chair so that
0:44 a, we know you're here, and b, you'll be ready, uh, to provide your public comment.
0:49 Ms. Love? Yes, if we can have holly reed who's gonna speak virtually, and right behind her, we will
0:56 have chris flores, michael nhas, jeffrey bowen, and José garza.
1:02 Perfect. Thank you.
1:09 Go ahead, holly. Ms. Reed, please go ahead,
1:19 please begin committee.
1:27 Good morning audit and finance committee.
1:29 My name is holly reed.
1:30 I live in district 10, and I served as a member of the Austin parks and recreation board from
1:37 2023 to 2025. On February 25th, the city of Austin auditors and city manager received an audit request to
1:47 review evidence that former parks director kimberly mcneely, made an unauthorized decision to divert $25 million of parkland mitigation
2:00 funds from the parks department to her future employer, the trail conservancy.
2:06 Her decision concerning the use of this massive amount of public fund was made without consulting parks department
2:14 staff, or her supervisor, assistant city manager, hayden howard.
2:19 For two years, mcneely and former trail conservancy, ceo, heidi anderson created a scheme to funnel $25 million of
2:29 texas department of transportation, four f mitigation funds directly to the trail conservancy for the trail conservancy to
2:38 solely construct a boardwalk for the hyatt pud developer attempting to bypass the city's parks department review and
2:46 the city's competitive bidding process.
2:49 Mcneely then applied for the job of trail conservancy, ceo.
2:54 Her actions have violated at least three sections of municipal code, including standards of conduct, disclosure of conflict
3:04 of interest, and restrictions on providing representation of others, a disclosure requirement that is in effect for 24
3:12 months after a former city official or city employee leave, city service or employment.
3:20 I ask that you please support this audit request and review the role of former parks director mcneely
3:26 in the texas department of transportation to trail conservancy funding scheme, uh, intended to divert $25 million in public
3:37 funding from the city of Austin parks department to the trail conservancy neely's future employer.
3:45 This audit request has also been sent to you, and I ask for the sake of public trust
3:51 that you demand greater financial transparency and ethical accountability in relationships between the parks department and any nonprofit
4:02 partners. Thank you. If we can have chris flores next, followed by michael neha, jeffrey bowen and José garza.
4:19 Good morning, uh, elected people.
4:21 My name is chris flores.
4:22 I'm a resident of district 10.
4:24 I'm speaking today on a citizen requested city audit by ms.
4:28 Diana proctor, about a $25 million highway mitigation payment, which appears currently to be pointing to a private entity
4:37 and your review and approval.
4:39 My first ask of you today is to please postpone indefinitely your vote on a boardwalk contract until
4:45 a full audit is done.
4:47 Typically, these mitigation payments are not newsworthy.
4:51 They're made from government to government.
4:53 The government to private is highly unusual.
4:57 I think government agents involved at txdot and the city have violated their fiduciary re relationship with the
5:04 public in making this deal happen.
5:06 And an audit will show this fiduciary.
5:10 Just for the record.
5:11 According to the dictionary, is a person to whom property or power is entrusted for the benefit of
5:18 another. Uh, there are four factors that define a fiduciary relationship between government and public, and they are,
5:25 one, the public has delegated authority to government agents over public assets to act on our behalf.
5:32 Two government agents have discretionary powers over the public assets and interests.
5:37 Three, government agents are in a position superior to that of the public due to their specialized access,
5:44 knowledge, and ability. Four, the public trusts that government agents will act in their best interest routing 25 million
5:53 from txdot to a private entity for the primary benefit of a boardwalk to front one lady bird
5:59 lake, a condo building and away from the parks department's land purchase team is not in the public's
6:06 interest. The stated purpose resolving an eight foot pinch point is bogus.
6:12 The lake trail has many such eight foot, eight foot pinch points.
6:16 My second ask today is that you initiate a study and recommendation that all city staff have their
6:23 fiduciary responsibilities to the public defined in their job descriptions to prevent future conflicts of interests.
6:30 I researched the parks department director's job description and found no mention at all of fiduciary responsibility.
6:38 Thank you. Up next, we'll have michael naja.
6:59 Good morning. My name is michael naja.
7:01 I'm on the economic prosperity commission, but I'm speaking on my own behalf.
7:06 Um, I spent the last, uh, year looking into the pensions, and I'm here to relay my news
7:11 and I wore a black tie because the news is not good.
7:15 I'm an expert in investing.
7:17 I traded on the new york stock exchange for the options market maker while I trading, who owns, who
7:22 controls 9% of that market.
7:24 I also have a master's of economics from ut.
7:27 My thesis was in international bonds and currency futures.
7:32 I'm an expert. The pensions are not in good shape.
7:35 Um, I hope you're all familiar.
7:37 Um, this is slide three.
7:38 We've been underfunding the pensions since about 2000.
7:42 The amounts been growing about a hundred million dollars per year, uh, and we've done that for 24
7:47 years. We currently owe the pensions about $3.5 billion.
7:52 One point I would like to communicate to you today is underfunding grows exponentially.
7:58 The the target amount for pension depends on future investments from that pension.
8:04 If we have it underfunded, we don't get the returns from those investment and the amount grows.
8:10 Um, if you look on slide five, you'll see that the amount it is growing by is labeled
8:19 interest in each of the pension reports.
8:22 Um, that is current in 2024.
8:26 The amount it is growing by is $308 million in one year.
8:31 Because it grows exponentially, it is viewed as debt, and we are borrowing from the pension funds at
8:38 a 6.9% variable interest rate as opposed to a general obligation debt of 4.3% at a fixed rate.
8:49 The other point I would like to communicate to you is that Austin does not have a realistic
8:54 plan. The the next slide shows, uh, the current plan.
8:59 Uh, we're at about $3.5 billion.
9:02 This is just cores one pension, but we're at $3.5 billion.
9:06 We plan on increasing the un underfunding for the next five years.
9:10 We'll be in the exact same position 10 years from now.
9:14 We'll have paid 6.9% interest for 10 years and be in the exact same position.
9:21 That will waste $2.4 billion for austinites or $2,400 for every person in Austin.
9:28 Not every worker, not every taxpayer, every person.
9:33 My ask to you today is to put an item on your agenda for a month from now
9:38 to allow me to present my results in full.
9:40 Thank you. Thank you, mr. Bowen.
9:46 Uh, good morning everybody.
9:48 Uh, morning Mayor committee members.
9:50 Um, I'm, I'm here this morning because I, I was reading the consultant contract management, uh, audit report.
9:59 And, uh, actually the young lady that spoke before me, uh, actually helped a whole lot because I
10:04 was gonna start off with the, the definition of fiduciaries.
10:07 Um, and it, I really appreciate that because when I started reading this, uh, the first thing that
10:13 jumped out to me was said, the city May not be able, May not be able to demonstrate
10:17 consulting services are justified, or they efficiently help city objectives and the needs of residents, and do not
10:26 consistently evaluate performance, so on and so forth.
10:29 So, so over two years, we're looking at $279 million.
10:35 Now, I really appreciate the report, but it leaves a lot of questions for me, such as, who
10:42 approves all of these different contracts?
10:44 Was anybody asking the questions?
10:47 Is this a want or is this a need?
10:50 And if it's a need, then where's the rest of the evaluations that says, well, is this because
10:55 of training? Now, I realize that there's, some of these departments are highly technical and they need some
11:00 different consulting. So didn't we recently have an issue to where we wanted to get rid of positions
11:08 that we haven't been able to fill, but we, so we got rid of those positions, but were
11:14 those positions needed to maybe fill some of this void?
11:19 So the report in itself, I, I find it to be very interesting, but also very disturbing in
11:26 the fact that we only looked at a certain percentage of organizations within this organization, yet they're not,
11:34 we're not notified as to what these, which one of these departments they were.
11:38 So out of the giant list of departments, what was that 8% that was missing this or the
11:45 9% that needed the documentation, so on and so forth.
11:49 So is there an issue with, um, not being able to train our personnel that are monitoring these
11:55 project or monitoring these consulting projects?
11:58 Or are they just not doing it?
12:02 Because I did notice this in several of these places that the personnel left that was managing these
12:07 for the different departments.
12:11 Why did that person leave?
12:13 Was this, was there no transition from, from one person to another to keep the management of this
12:21 consulting job going on?
12:23 So I find a lot of questions, and I'm hoping that the audit commission here, the audit committee
12:28 here, will ask a lot of hard questions as to what's going on, who's responsible, and also does
12:37 it, who falls, who pays for, or who approves the payment of this?
12:41 Is it done strictly on consent or is it out of the commission out of the different, uh,
12:46 departments itself? Thank you.
12:48 Thank you, mr. Bond. Up next, we'll have José garza.
12:55 Mr. Garza, I don't see mr. Garza.
12:59 Okay. Thank you very much.
13:02 Members, that will take us to item number one on the agenda, which is the approval of the
13:06 minutes. Uh, these are, you have two sets of minutes you'll recall that I asked that we, um,
13:12 uh, pull the minutes from a previous meeting and they've been re redone.
13:17 And, and that's what we have here today.
13:19 Uh, it would be to approve the minutes of the audit and finance committee meeting of both January 14th, 2026
13:24 and the February 3rd, 2026 meeting, um, is I'll, I'll, it's moved by, uh, Council Member uchin second by council
13:33 member Fuentes, that we approve those minutes.
13:35 Any discussion without objection.
13:37 Item number one is adopted.
13:39 Now we'll go to a discussion and possible action on a couple of items.
13:44 And the first one is item number two with regard to the potential dis continuation or dissolution of
13:50 the south central waterfront advisory board.
13:53 Yes, ma'am. Good morning.
13:55 Stephanie hall, deputy city clerk, and I'm here to present the discussion on the south central waterfront city code
14:00 does require that if a border commission fails to convene for a continuance of six months, that we
14:06 are to report them to the audit and finance committee.
14:08 That sounds bad. To report, to send a notice to the audit and finance committee to let us
14:12 know <laugh>, yes. To inform you that they have failed to meet.
14:15 And then there is a 60 day period in which the audit and finance committee needs to make
14:19 a recommendation on the dissolution or continuance of the, uh, the advisory board.
14:24 In this particular instance, the south central advisory board has failed to meet.
14:27 They've struggled to make quorum for about a year.
14:30 The last time they met was in March of 2025, and then they did, they were able to
14:34 make quo just this past February.
14:36 Uh, this board is a little bit unique.
14:37 They have nine seats, and five members are required to be present in order to convene a meeting.