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
The Audit and Finance Committee approved minutes from its January 14 and February 3, 2026 meetings, recommended dissolution of the South Central Waterfront Advisory Board after it failed to meet for six months, and recommended Commission on Aging bylaw amendments (including a new Age Friendly Advisory Committee) to the full Council. The committee held an extended discussion, without a vote, of proposed changes to general obligation debt financial policies presented by the CFO, covering credit rating metrics, six-year bond election cycles, sizing of bond propositions, and reimbursement resolutions. Briefings were received on the flood preparedness and awareness audit, the consultant spending audit, and technology spend optimization. Item eight was deferred to the next meeting. Public comment included requests for an audit of $25 million in parkland mitigation funds, concerns about pension underfunding, and questions about consultant contract management.
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.