>> if i may, i have just a quick question. in which case did you guys not know that you had to require this of them? i just wanted to -- >> yeah, that's correct. >> okay. >> sometimes we did have the duns numbers, but we weren't aware it was required for all single audit contractors. >> thank you for responding to that. thank you. >> so, the next finding, 2012 3 related to indirect costs at the department of environment. this is a grant from the u.s. department of energy and the grant allows for claiming reimbursement for indirect costs. during the audit we found that the indirect cost rate used for reimbursement claims was from [speaker not understood] indirect cost rate plan. when the state had approved the indirect cost rate plan, the rate was -- the approved indirect cost rate was actually lower than what was proposed by the department.

but because the proposed rate was used for reimbursements, we did identify a question caused in this item. so, we report this particular finding. and i think the department is here to speak on this item as well. >> sure, let's bring them up. >> yes. >> department of environment. >> hello, commissioners. joe [speaker not understood], department of environment. this issue came up because we're using the proposed rate of the icrp when we were creating the budget for this agreement. and subsequent to that, the actual approved rate was different than the one that we had put into the agreement. so, this audit actually brought it to our attention and since then we have rectified that with the funding agency and made our indirect rate conform

to the approved icrp rate. thank you. >> thank you. >> so, that was the last of the findings from our single audit report. do you have any questions from the audit report from 2012 so far? >> no, i think we've peppered your presentation with our questions. supervisor campos has one more. >> what about the homeland security grant program? >> i'm sorry, i may have skipped that one. oh, yes, i'm sorry. so, there is the very last finding is internal cultural reporting. this is the process of submitting reports to the grantor. this is not a noncompliance finding, meaning we did not find any er rs in the reports themselves. it was part of the process. [speaker not understood] would not be reviewed before it was submitted and that could lead

to a chance of errors. so, we wanted to bring out to the department as well as your attention. ~ >> and is there someone here from the department of emergency management? >> good morning, commissioners. my name is patrick [speaker not understood], i'm with the department of emergency management. to address the single audit finding, we've actually involved another manager within our department to review any reimbursement requests or any claims that are submitted to the grantors prior to submission. and we feel that this addresses any concerns for the audit finding. >> thank you. >> okay. so, the very last report that i have to present to you today is our audit plans for the 2012-2013. a lot of items that are included in this document that we have submitted to you have

already been covered by kpmg in her prior presentation. so, i'll just give you an overview and highlight some of the key items i wanted to point out to you. on page -- starting with page 1 of the document, the executive summary, what this document includes is an overview of our audit process and our audit scope. the scope of the 2012-2013 audit will be the same as what i had mentioned as our audit scope for 2011-12. so we do audit all of the city funds except for the ones audited by the other auditors. if you will turn to page 3 of the other fund, it is a chart, if you will, on all the engagement teams we have assigned to the city's audit. the city's audit are broke not out into six different groups and they include the port of san francisco, the two hospitals, the successor agency

to the redevelopment agency, the general city, which includes the single audit. the retirement system as well as the finance corporation. so, we do have individual teams that we assigned to this audit and along with our audit of the general city we also work with two local business enterprises. [speaker not understood] and lou ann wong on our audit. next, i wanted to highlight the audit timeline. so, if you will turn to page 5, this is our timeline for each update individual component that are included in our audit. we are going through our [speaker not understood] phase now. we meet with representatives from governing boards and the key management to perform a risk assessment process. we come back during the september, october time frame to perform it the year-end audit where we substantiate the end balances, and we -- the goal is to issue all of the reports by thanksgiving of this

year, except for the single audit which usually takes longer, into the january, february time frame. so, by then, by the end of this year we should have results in terms of the city's financial statements, and by march and april of next year we'll come back and present on the single audit. page 11, the engagement communications which goes over the responsibilities of the auditor as well as of management because that was basically covered in ms. nguyen's presentation. i'll skip that part. let me know if you do have any questions. lastly, if you would point to page 17 through page 19 of the document, these are all the accounting standards that will be required to be implemented by the city and [speaker not understood]. i mentioned earlier in my presentation will be the pension standards that will be required to implement in 2014

and '15. and this document highlights some of the key changes that are expected to be coming. and with that, i'd like to close my presentation and turn it over to carmel a frank. >> thank you. >> thank you. ~ thank you, supervisors. did you have any other questions? >> thank you very much. colleagues, do we have any other questions on this item? no -- oh, supervisor -- >> i just want to make the point this can be very dry stuff, but it's actually one of the most important functions that this committee performs. you're making sure that there is an independent third-party review of the external auditors of the finances of the city. and i'm very appreciative that all of the city departments, where there was a finding, were present to address, you know, what they were doing to deal with some of the findings and recommendations. and, of course, thank you to the controller's office that does a great job of overseeing

all of this. and, so, of course, thank you to our external auditors as well. >> thank you very much. thank you. let's go and move for public comment on this item. i'd like to open up public comment at this time. if anyone would like to comment, please come up, sir. good afternoon. my name is alvin [speaker not understood]. i have a couple questions for the two auditors. first one is regarding the redevelopment agency being closed, is it your judgment that the turmoil caused by the closure of the agency and the transition to a new body created a lot of problems in the sense that there wasn't a proper transition period? >> so, this is public comment,

sir. you have two minutes to state your question. this is not an opportunity for a forum for them to rebuttal or answer your questions. so, what can happen is after we move this item -- i'll make my own point. from what i see from the rda got shut down, from their testimony, turmoil was created in terms of transition. they couldn't keep track of -- they lost staff. they lost continuity, okay. that's one thing i see. the other thing -- and i guess they can't answer it -- is regarding some of the deficiencies that were found in terms of mta, in terms of the new pension standards. i believe they were given -- being given about two years to

resolve that problem, not three quarters to one year, okay. so, there's a time element involved in terms of -- in terms of correcting the deficiencies. finally, mta has some compliance problems that i heard the item specifics, but would have warranted shutting down mta. that's all. >> thank you for your comment. are there any other members of the public that would like to comment on item number 3? okay, seeing none, public comment for item number 3 is closed. [gavel] >> may i entertain a motion to file this to the call of the chair? thank you, motion made by supervisor tang, seconded by supervisor campos. this motion is filed to the call of the chair. [gavel] >> madam clerk, could you please call item number 4? >> item number 4, hearing to address and assess the loss of credit asian of the city college of san francisco. >> okay, thank you very much. today we also have joining with

us ~ supervisor avalos who will begin to steer the conversation for this item. ~ accreditation supervisor avalos, would you like to offer opening remarks? >> yes. yes, i would. thank you very much, chair cohen. and thank you for co-sponsoring this hearing along with supervisor campos as well. >> thank you. >> this is an emergency hearing that we've called, really to address big concerns in san francisco about potential closing of city college. we have heard members of the board of supervisors, while we don't have direct jurisdiction over city college, we under just how important city college is to san francisco for so many reasons. we have our work force programs train thousands of people to be prepared for our local aloe economy.

in a way, city college serve as an economic engine for the city to help prepare the work force for that. there are many people who use city college to prepare for four-year institutions and allow youth of color, especially [speaker not understood] is an institution where they can actually go on to four-year institutions and city college plays a vital role for that. we have a great deal of vocational training that goes on that -- >> excuse me. ladies and gentlemen, as you come into the committee room, we're trying to handle business here. if you could please come in quietly. and if you do not have a seat, i will have to ask you to go back to the overflow room. supervisor avalos, please continue. >> thank you very much. there is a great deal of vocational training [speaker not understood] that city college is involved in. we have a very high immigrant population in san francisco and many people in the immigrant community are learning english as a second language so they

can actually have a better fit to work in our local economy and city college provides support for them as well. we have campuses all over san francisco touching many, many neighborhoods, touching all of our communities in this city. district 11 where i serve on the board of supervisors is right across the street from the main campus of city college and has a strong connection to neighbors and residents throughout the district. and it's a vital institution that we want to be able to protect. through the purpose of this hearing -- excuse me, it's getting hard to concentrate with a lot of talking in the background. so, the purpose of this hearing is really probably for me is to educate myself, other elected officials on how important city college is, to hear -- have a place where people can voice

concerns about what's happening with city college as well as to hear what public officials are doing to protect city college. we have representatives from our state level of government and local level of government. i know that our assembly has taken steps and actions to support city college as well as the mayor's office has done so -- is doing so as well, as well involved with the trustee to make sure that city college is able to stay together and keep accreditation. just a couple weeks ago, while it wasn't a big splash, we did ask the question of the mayor at question time separate from our typical way, we ask questions of the mayor. it was more on the spot question to ask what the mayor is doing to support city college at our community -- who are reliant on city college. he poke at that. if we can get an update from the mayor's office as well what the mayor's office is doing. ~ spoke at that there have been questions about

the accrediting commission, and the role the accrediting commission ha played. [speaker not understood] are here to discuss that. ~ has played i think that is a strategy the city needs to take on about whether we should question the crediting commission and the recommendations and [speaker not understood]. we'll probably hear from both sides from that question. there are people who have been involved in struggles for city college for years and trying to make city college legitimate institution. at times, the changes that are being forced, it is important to be accredited and opening and make the change people want to see. we'll be hearing from people talking about that today as well. there are great concerns -- i'm sorry, the murmuring in the room is really distracting. if we can keep our voices down, close the door, i would appreciate it. is the door open? if we can close the door, i would really appreciate it.

it's really distracting. thank you very much. there are great concerns that people have that the city college could be a track towards downsizing, [speaker not understood] programs and possible privatization, setting up public assets. i think there is a -- those are really great concerns. especially when we see on the national level that happens in educational institutions around the country. we've seen great changes in chicago that are -- actually was the home base of [speaker not understood] duncan who is our education -- the commissioner of our education, secretary for the obama administration. we'll hear concerns about that as well. there are cautions on all sides we need to take. most of all what unites people together, we want to see city college maintain accreditation. it would be unacceptable for city college to close. it would be unacceptable for our enrollment which has been 85,000 students, to be turned over to $40,000 students. that cannot happen.

~ there are so many communities that rely on robust college and we want to make sure we have a pathway to keeping it going. the pathway needs to include, while there are vast differences about what city college should do and how we should support city college, there needs to be some unity about how we can get on the same page to protect it and create the kind of change that people want to see at the same time. and, so, i would like to see -- i expect that this hearing could be one in a series, perhaps of my colleagues on the board may decide they want to hone in on a particular subject and we could have a special hearing on that. but i think that given that the board of trustees has been suspended, that there is a role that i believe the board of supervisors can play to provide a public space and venue for people to express concern and make recommendations on public officials, especially when the mayor's office is involved as well, that we can support the

mayor's efforts with those recommendations coming forward. so, my colleagues have other comments they want to make in introduction, we can do them before calling some of our speakers. >> thank you very much, supervisor avalos. supervisor campos. >> thank you, madam chair. thank you, supervisor avalos, for your leadership in calling for this hearing. i'm proud to be a co-sponsor of ti want to thank all the members of the community who are here, not only the students, but i see many of the faculty. i see our teachers union here. let me just say this. i don't know that anyone disputes the importance of making sure that city college has its financial house in order. the problem that i have is that i don't think that having your financial house in order means that you actually lose the character of this institution. san francisco and our city government is a perfect example

of that, has a long history of being able to respect and adhere to the values that we have as a city and still have a government that is fiscally and financially responsible. the concern that i have and where i hope that we get to a point where the entire elected city family is on the same page is that some people are talking about having this financial house in order, but saying that that means that you have to lose all these programs, you have to lose the identity of this program -- of this entity. and if that is the position of what it means to be financially responsible, then i do think we're going to have a problem. there are things that have to remain -- (applause) >> and that's what i want to be clear about, that we cannot save city college if saving

city college means having a city college that no longer looks like what city college has been. so, supervisor avalos talked about the language programs. it's the adult education classes, the job training programs, the work force development initiatives. it's the second chance programs for formerly incarcerated youth. it is the bet van center that helps so many vets not only get training, get jobs. it's the guardian scholars programs that serves former foster care students with academic and nonacademic support. it's the programs addressing senior help. it's helping students transfer to four-year colleges. it's preserving lower cost higher education can which is -- city college is the only way that so many low-income folks can go to college. it's maintaining the special community-based campuses like mission campus in my district that serves 8500 students, 70% of whom are immigrants.

i do think that we need to continue these hearings and i will end with this, that my hope and what i would like to do as the district 9 supervisor is at the next hearing that we have -- and we intend to have that -- will be on the site of mission campus so that we can hear directly from the community and go to that community. (applause) >> because what i'd like to have a conversation about is what is it that city college does for this community that we frankly don't fully realize the extent of the benefits of this institution provides so that we have a better understanding of what it is we're saving. >> thank you very much. supervisor mar. >> thank you. i wanted to thank supervisor avalos, but also supervisor cohen for bringing this forward and supervisor campos. in april many of you were before the board of supervisors as we struggled through a resolution that was eventually

passed unanimously by this body to fully support city college and to do much more the city are [speaker not understood] support the quality and diversity of the school's education. as supervisor campos mentioned, it's not just any city college, it's our city college that's been developed through years of struggle and involvement of the community's -- from everything from our work force programs to english as a second language and other programs that supervisor avalos mentioned. i also wanted to say that high drab mendoza, the mayor's education advisor e-mailed us a memo on tuesday. i'm hoping she can address pulling more of the city family together to do as much as we can. i think there are a lot of questions that came up in different rallies to save city college from the grassroots community based efforts asking where is mayor lee on the issue ~ and hopefully ms. mendoza can address some of those questions how we all work together not just for all city college, but

our city college programs that have been developed over the years by faculty, staff, community and students. also there is a question of what's the economic impact if we had -- if we were to lose city college as the acc, jc recommended, what would be the huge loss to work force development programs and the economic base of our city or pulling in workers from outside versus pulling up people from our communities and educating them and preparing them for a work force for today. so, i guess those are some questions, working with others to make sure we have a budget and legislative report on those impacts. and hopefully with all the different tools and working together we can do our best to even improve city college to make it more relevant and empowering to the residents that depend on it every day. as we built the safe city college coalition and campaign over the past year, i think the slogan that i'm city college resonates with me. every one of us has -- if not

we ourselves, have been students, we have family members and others that depend on this critical institution. so, i'm really please that had we'll have many people testifying on this today. (applause) >> thank you. thank you, colleagues. i appreciate your comments and support. first speaker up will be gohar [speaker not understood] with the accreditation liaison officer at city college to provide an update. thank you. >> hello, i'm gohar [speaker not understood], the accreditation liaison officer at city college of san francisco. my job is to work on behalf of the chancellor to work with the accrediting commission, to meet the accreditation standards, to help conduct the internal self-evaluation, and again, to make sure we meet the standards. before i start, i want to make sure that it's clear we are open. we are accredited and we're enrolling students. in case anybody is reading the headline there, we have not lost accreditation.

we're open. we're accredited and we're enrolling students. before i start, i want to give you a few facts about the accrediting commission and then we'll pass around a flyer so that you've got some of that information before you. accreditation is a voluntary process, a quality review that institutions agree to undergo periodically. it's a system of self-regulation. accreditation standards represent the best practices in higher education, their six geographic regions in the united states. the accrediting commission for community and junior colleges is part of the western association of schools and colleges. they are authorized to operate by the u.s. department of education. accreditation review is conducted in four phases. the process involves internal self-evaluation, external evaluation by professional peers, commission evaluation, and institutional self-improvement to meet your goals.

the accreditation standards describe best practices in institutional operations. this encompasses everything about an institution. your mission, your effectiveness, instruction, support services, facilities, library learning resources, human resources, financial operations, facilities, physical resources, technology resources, fiscal management, governance, and decision making. >> can i pause you for just a sec? [speaker not understood] your next statement, but the accreditation standards, where are those set? >> those are set in the accreditation reference handbook. again, it's a peer process. so, the standards also go through an evaluation process where they can make changes to those standards. they're general statements of what an institution needs to have. the commission and the standards do not dictate how to meet that standard. so, most general statements might be that your budgeting

systems are integrated with your planning systems. they don't specify exactly how you do that. the institution needs to do that itself. it might state -- the standard will state the institution must have a mission statement that's regularly reviewed by using this governance processes and evaluated on a regular basis. >> so, this is a state set standard or is it the acc/jc set standard? >> there is the accreditation community that the board of junior colleges. the larger organization is the western association of schools and colleges. so, there is the commission for the senior colleges and universities. there is the commission that deals with elementary, middle school, and high schools. and this is the one for junior and community colleges. >> so, as far as like our department of education for the state of california, that

doesn't have necessarily a role that is played in terms of how standards are set -- [multiple voices] >> there needs to be alignment, of course, with whatever the federal regulations are, state regulations. >> so, is that for the acc/jc role of accountability with -- directly with state or federal level? >> they are reviewed by the u.s. department of education and there's another body called the council higher education -- council of higher education of accreditation. it's called chia. >> thank you. >> and i can send more formal information on that as well. the commissioners of the accrediting commission are faculty members from other institutions. there are 19 commissioners. there are some that represents -- there are three members that represent public interests. there are administrators, some other member institutions, and then people representing other educational entities. they go through a nomination

process and it's the chief executive officer, the chancellors and presidents who elect the commissioners. and, again, it's a peer review process. the commission is basically servicing all of its member institutions in this peer review process. evaluation teams are also composed of faculty members, administrators, even trustees of other institutions when they come to evaluate an institution. i need to make clear also the accreditation standards need to be met at all times. so, it's not like you go through a review process, check mark, great job, and then you stop what you're doing and you get ready for the next evaluation. you need to be in compliance at all times. those are the basics of the commission. and again, i'll give you more information on that. to provide you just an overall update of where we are at this point, on july 3, 2013, the

accrediting commission for community and junior colleges acc/jc, they announced their decision to terminate accreditation effective july 31, 2014. the decision is not final. it's not a final decision. city college remains open, accredited. we are pursuing a review and appeal process. they have procedures and processes and we will be following those by laws and policies to pursue the review and appeal process. that will take a long time. and as long as we're undergoing the review and appeal process, the college still remains open, accredited, enrolling students. >> when you say a long time, what does that mean? >> you have to read the policy. it could take up to a year. i don't know. it depends how long each process takes. there is a review process. if they uphold the determination that we're terminated, then we