CITY OF SAN ANTONIO
FINANCE DEPARTMENT
Interdepartmental Correspondence
TO: Sheryl Sculley, City Manager
FROM: Ben Gorzell Jr., CPA, Chief Financial Officer, Finance Department
COPIES: Audit and Accountability Committee; Kevin Barthold, City Auditor
SUBJECT: Centro update
DATE: March 20, 2018
A Public Improvement District (PID) is a mechanism that permits the City of San Antonio ("City") to levy an assessment on property owners within specified boundaries. PID funds may then be used to provide services which are supplemental to those provided by the City. Supplemental services include items such as streetscaping, beautification, maintenance and ambassadors.
The Downtown PID was created in 1999. The City contracts with the Centro Public Improvement District to provide the supplemental services. The current contract has a ten year term beginning on October 1, 2013 with an expiration of September 30, 2023. Through this contract, the City reimburses Centro for the services provided within the PID upon receipt of supporting documentation for those services. Centro is a public-private partnership that was created in 2010 to assist in the redevelopment of San Antonio's downtown. It is a non-profit corporation governed by a separate Board of Directors and is not a component unit of the City of San Antonio for financial reporting purposes.
Last November, the Board of Centro uncovered that a former Centro staff member had embezzled funds from the organization and orchestrated a fraudulent audit report and presentation. Both the City and Centro engaged firms to conduct independent reviews. The City Manager directed that the City's Finance Department engage an external independent audit firm to conduct a review of the reimbursements made to Centro. The scope of that review was focused on assessing whether any fraud occurred within the PID and the eligibility of expenses reimbursed. It did not include reviewing Centro's other sources of funds and is n...
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