This Is Reno obtained two-and-a-half years of City of Reno public records on discretionary spending to see how the Mayor and City Council members spent those funds. Hours were dedicated to poring over numerous travel receipts, city council donations, candidate disclosures and other documents. Findings reveal that some council members have repeatedly submitted travel requests and expense reports that may violate city policies. Expenses also have unclear benefits for the Reno community.
This is part 10 in a 10-part series, which has been published over the past 10 days. Read the complete series here. Subscribe here to get access to all This Is Reno articles.
City officials in 2018 were audited, and that audit found similar infractions to what This Is Reno’s current reporting found. Infractions included giving money to nonprofits without documentation, inappropriate travel authorizations and excessive travel spending. The internal city audit revealed 49 violations of purchase card expenditures. Some infractions were made under a previous city manager, Andrew Clinger.
Internal City Auditor Emily Kidd’s 2018 “executive turnover” audit specifically highlighted many of the same spending practices that records show continue to be violated. She found that, in 2016 and 2017, there were four instances of elected city officials not properly filling out travel forms—or not filling them out at all.
“Training and travel paid for with City funds are required to have proper approval prior to the expenditure with appropriate supporting documents maintained,” the audit noted, stressing that these rules apply to all city staff and elected officials. “City funds may be misappropriated if established policies are not completed in full for expenditures.”
Other audit violations included excessive airfare charges, lack of documentation to support travel purposes for official city business, pre-travel approvals getting approved after travel was completed, inappropriate per-diem reimbursements, city funds being spent on non-city-related activities, unauthorized employees approving expenses and using city funds for donations to what may not have been nonprofits.
“Departmental policies detailing internal controls and procedures for departmental functions do not exist,” the 2018 audit noted. “Conducting departmental operations without documented internal controls and process standards is not within management best practices.”
Other non-compliant expenditures included purchases of tables at charity events, which required city manager approval but did not have the appropriate documentation. A credit card purchase was for a donation of about $100 allegedly to a nonprofit but without documentation to verify the organization’s status.
“We don’t have a policy for management donations, so it was difficult to determine if that was an appropriate donation,” Kidd said at the time. “Folks were not aware of that.”
Another purchase was for exercise equipment that “was approved by previous management,” and was determined to violate city spending rules. The report recommended that the city not allow this kind of expense, and it recommended new policies be created.
Reno Mayor Hillary Schieve and City Council members at the time were not provided details of audit findings of improper expenses made through the city manager’s office from July 1, 2015, to June 30, 2017, even though they were the ones violating city policies. They were not informed that it was expenses made at their behest that were called out in the audit—until This Is Reno reported on the situation. The city initially refused to make the audit public.
Kidd said there was a lack of awareness about purchasing processes, something the mayor and council members agreed with at the time. City officials then assured the public changes were made to prevent unauthorized or exorbitant expenditures.
“Under the previous City Manager [Andrew Clinger] the use of expenditures seemed to be vague at best. Under our new City Manager [Sabra Newby] I am glad to see better compliance and policy put into place immediately.”-Reno Mayor Hillary Schieve in 2018
Kidd did not respond to This Is Reno to explain what appear to be serial violations of city policies documented in the recent travel and expense documents.
City officials said the spending problems were addressed in 2018. Schieve, in particular, said changes were made after the audit, and she blamed former City Manager Andrew Clinger for the spending irregularities.
“We had a procedure that wasn’t exactly correct, so [then new city manager Sabra Newby] is looking to clean that process up,” she said. “I was … surprised how many people have credit cards. We’re not seeing [the details of] those individual expenditures. That, to me, is a concern.”
It’s a practice that needed improving, she added. Schieve forwarded to This Is Reno in 2018 an email she wrote to auditor Kidd, implying it was Schieve who was behind recommending the audit and changes in spending practices at City Hall.
“Under the previous City Manager [Andrew Clinger] the use of expenditures seemed to be vague at best,” Schieve wrote. “Under our new City Manager [Sabra Newby] I am glad to see better compliance and policy put into place immediately.”
Schieve requested better oversight, policy training, additional checks and balances and improved reporting practices. A spokesperson for the city manager’s office in 2018 also stressed new purchasing procedures were put in place.
Those changes included ensuring only cardholders made purchases on their cards, reviewing purchasing policies and communicating changes to staff. Making sure expenditures have proper approval was also alleged to be a problem that was fixed.
“We were aggressive in addressing these findings,” the city’s then-spokesperson, Jon Humbert said six years ago.
