Maywood's contract extension with its city administrator contains provisions that allow the city council to terminate the administrator with or without cause by a simple majority vote. The contract extension also enumerates the city administrator's duties and responsibilities, and requires the city council to review his performance annually, explicitly stating that poor performance is a cause for dismissal. The city administrator stated that the city is in the process of implementing a performance evaluation policy and procedure that will apply to his position as the city administrator and to all other employees. In addition, the city administrator asserts that the city will only renew contracts when warranted by an assessment of performance.

As we recommended, Maywood's city council voted to eliminate the $250 monthly mileage payment effective October 30, 2016, and the city administrator states that he will implement a policy that defines mileage reimbursement procedures for elected officials and city employees. The city also states that the city administrator and city council now regularly review expenditures to ensure that charges are justified, a practice that is supported by a new accounts payable and disbursements policy provided by Maywood. Finally, the city administrator states that he has arranged to provide training to members of the city council including training on Maywood's municipal code, ethics, the Brown Act, contracting, financial management, budgeting, and human resources. We look forward to reviewing the city's training calendar or other records of the training provided to city council members and staff when we receive its next corrective action plan update.

Maywood states that the city council undergoes Brown Act training every two years; however, we disagree with this assertion. As we discuss on page 11 of our report, we identified two city council members who either had no training record on file with the city or had not demonstrated receiving this training within the last two years, as mandated by law. Nevertheless, Maywood indicates that city council members would receive Brown Act training in 2017.

The city administrator is also working with the city attorney to cure past Brown Act violations and states that when those violations are cured he will send us supporting documentation. As we noted in our report, that same city attorney provided unsound legal advice, which may have caused the city council to commit violations of the Brown Act. However, Maywood has apparently not yet finalized a corrective action plan for ensuring that it receives reliable legal advice concerning the Brown Act and other areas of state law affecting its operations. The city states that it will provide a timeline for completion of its corrective action with its next update.

In addition, Maywood provided a draft hiring policy that details a process for hiring the most qualified individuals; however, the policy does not explicitly call for the performance of a comprehensive and documented staffing analysis that demonstrates the need for each position. The city plans to present the new hiring policy to the city council for approval before its next corrective action plan update is due. The city is also documenting a more formal process for executing written contracts for applicable positions. Maywood states that it will provide us with the timeline for completion of this formal process and policy with the next update to its corrective action plan.

Maywood has reached an agreement with the California Public Employees' Retirement System on a plan for repaying delinquent amounts (totaling $3.1 million, including accrued interest) for its inactive safety retirement plan by January 2019. However, Maywood has not yet developed a plan to address its $2.6 million debt to a former redevelopment agency (now a successor agency). Maywood further states that it has continued to meet with the California Joint Powers Insurance Authority to discuss a repayment plan for its $10.3 million debt, and has been making monthly payments of $10,000 in the meantime.

Finally, the city states that certain employees have grandfathered rights with respect to their pension status, which prevents the city from requiring those employees to pay their share of retirement benefit costs. The city administrator indicated that he will recommend to the city council that all other city council members and staff begin paying their share of retirement costs starting in fiscal year 2017-18. We look forward to receiving documentation that supports the city's assertion that certain employees have grandfathered pension rights, along with documentation showing that other employees are now paying the full employee share of retirement costs, with the city's next update.

Maywood developed draft budget policies that clearly establish Maywood's budget process, from the initial development and adoption of the budget, to its continual monitoring by appropriate city staff, management, and members of the city council. The draft budget policies include a requirement for a five-year financial plan that will forecast anticipated revenues, expenditures, and repayments of outstanding obligations. These policies also include requirements for a periodic review of budgeted-to-actual revenues as well as expenditures. The city expects to present these new budget policies to the city council for its approval before the city's next corrective action plan update is due.

As we describe on pages 24 and 25 of our report, Maywood's lack of sufficient staff to enforce its parking laws resulted in significant lost revenue. After we brought this issue to the attention of the city administrator, Maywood hired two additional parking enforcement officers who, according to the city, issued 5,370 citations over a period of less than a year, resulting in $318,286 in additional revenue. The city indicated that it needs at least one more parking enforcement officer to cover weekend overnight parking concerns and has posted this opening on its website. In addition, the city evaluated its code enforcement needs and will present to the city council an amended budget for fiscal year 2017-18 to include one additional code enforcement officer. The city also indicates that its new parking citation contractor finished converting Maywood's old parking citation data and captured all unpaid citations in the new system, and the city has received 182 payments on these citations totaling $10,781.

Maywood states that it now contracts with a firm to help it identify businesses that collect sales tax but do not have a Maywood business license. The city indicates that it is in the process of contacting those businesses. Further, Maywood notes that it will study the option of hiring a collection agency to reach those businesses that neither pay sales taxes nor have a Maywood business license. The city also indicates that it now requires businesses to provide a copy of their most recent federal tax return to substantiate the amount of gross receipts that Maywood uses to calculate the cost of their business license.

The city is in the process of refining a new policy for ensuring that it invoices lessees of city property in a timely manner and assesses late fees for any delinquent payments; however, it is still developing a process for ensuring that it maintains current copies of its contracts with all vendors and lessees. Finally, Maywood is reviewing past payments received from its waste contractor Republic Services to ensure it complied with the terms of the appropriate contract and plans to provide the results of that review with its next update, along with its plan for monitoring future payments.

Although Maywood states that it adheres to its current purchasing policies and procedures, it also said that it is reviewing those policies and procedures and will modify them as appropriate. Nonetheless, Maywood has not provided us with evidence that it has fully documented those procedures. We continue to believe that the city administrator should fully document those procedures in a purchasing policies and procedures manual as required by Maywood's municipal code, and we expect to receive a copy of that manual with the city's next update to its corrective action plan.

The city also states that it is committed to formulating a detailed city contractor policy, which will include specific details on what is expected of city contractors (time limits, other terms, etc.) and provided a copy of a form it is using to monitor its contractors. While this form demonstrates how Maywood will track contracts to ensure that they do not lapse, it is unclear to us how Maywood plans to use this form to monitor contractors to ensure that they adhere to the terms of their contracts. Maywood also points to sections of its municipal code that require compliance with state law; however, these code sections do not specify how the city will monitor its contractors' compliance with applicable state law, such as the prevailing wage law. As discussed above, we expect the city to provide a purchasing policies and procedures manual with its next update, which should include procedures for monitoring contractors' compliance with the terms of their contracts and applicable state laws.

Maywood is in the process of updating its accounting policies and procedures, and indicates that its next corrective action plan update will include a finalized accounting manual, including detailed internal control policies and procedures. We reviewed a draft copy of the city's accounting policies and procedures, and found that it addresses some of our concerns but does not yet address all of our recommendations. For instance, the city has developed a detailed policy covering its accounts payable and disbursement procedures, but it has not yet developed policies and procedures related to its financial reporting function. In addition, the city indicates that its new principal accountant meets with employees on a regular basis to ensure their understanding of the importance of following the city's new policies and procedures. However, we believe that the city should also formally train its staff on these procedures. We will review the city's complete accounting manual, and related training plan, to verify that it addresses all of our recommendations in this area.