AUDIT COMMITTEE SUMMARY
February 18, 2020
Audit of Finance Google Fiber Right-of-Way Agreement
Report Issued February 11, 2020
Audit Objective
Determine if the Google Fiber right-of-way contract is adequately managed.
Background
In an effort to bring high-speed internet access to San Antonio residents and businesses via fiber optic cables, the City partnered with providers to establish franchise agreements, fiber optic right-of-way (ROW) agreements, and land lease agreements. The City entered into an agreement with Google Fiber on November 15, 2017. The agreement established quarterly license fees equal to three percent of gross revenues derived from the operation of the licensees' communications networks. The City started receiving revenues from Google Fiber in February 2018. As of August 2019, the City has received revenue totaling $139,057.
The Public Utilities Division of the Finance Department is responsible for the monitoring and collections of the Google Fiber right-of-way agreement compensation within the City limits. Oversight of the Google Fiber agreement includes the assurance that Google Fiber is in compliance with the laws, rules, and regulations established by state and federal agencies, the provisions of the license agreement, and City Council Policies.
Scope and Methodology
The audit scope for this audit included license fee revenues received from October 2017 through June 2019. We reviewed the monitoring procedures associated with the Google Fiber agreement. In addition, we reviewed license fee revenues received and supporting documentation.
Conclusion
Finance is not adequately managing the Google Fiber contract. While Finance has established a contract administrative plan for monitoring the agreement, procedures are not currently in place to request or review support to ensure the completeness and accuracy of revenue received.
We made a recommendation to address this issue. Management agreed with the recommendation and develope...
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