John Peyton's Open Letter To Community

[Lunican]

Dear Fellow Jacksonville Resident:

These are demanding and difficult times for Jacksonville, a city with a proud tradition of fiscal responsibility. For the past 12 years, we have not only enjoyed the lowest property tax rate of any major city in Florida, but we have also lowered that rate every year. And, until now, we have also been able to avoid charging fees that others throughout the state have been paying for many years.

The actions taken by the Florida Legislature last May have changed that scenario dramatically, necessitating a major shift in how we manage our finances. Their sweeping changes to the state’s property tax system significantly reduced the amount of revenue Jacksonville could expect in the coming year, leaving us with a $65 million shortfall. To address that shortfall and make provisions for the city’s future, my FY 2007-08 budget proposes a blend of reductions and cuts, combined with the institution of three fees similar to those already in effect throughout the state. The Jacksonville City Council Finance Committee has completed two workshops on this budget proposal and will conclude their work on September 25.

Make no mistake about it: we are not making these changes just to “fill a hole” in the budget. We are making them to make sure we can continue to provide core services like public safety and infrastructure maintenance. We are also taking steps to ensure that Jacksonville’s quality of life â€" the thing that sets us apart from other cities -- is maintained. On one hand, we are asking citizens, city employees and the nonprofit community to tighten their belts and make do with less. On the other, we are asking Jacksonville residents to pay the three fees I have mentioned.

These fees are moderate, and they have been structured so as not to impose an undue burden on any individual or business. They are also smaller than comparable fees throughout the state. Still, I regret the need for them, because they represent a change in our way of doing business, and change is not easy, particularly when it involves money.

We are asking for these changes at the same time that we are working hard to correct deficiencies in the way the city procures professional services. The hiring of two contractors who were personal friends of mine, one of whom was a former staff member in the mayor’s office, should not have happened. Our government is only as good as the processes in place and the people who administer them, and these incidents were a failure of both. They are inexcusable; and, although I was not involved in the hiring process, I am ultimately responsible. I am deeply sorry about this lapse in judgement and I apologize.

Over 2,800 formal contracts, worth in excess of $1 billion, have been executed since I took office, along with an average of approximately 16,000 purchase orders per year. However, even one incorrect or inappropriate award erodes the public’s trust, and it is important to address citizens’ concerns in the most immediate, conscientious and transparent manner possible.

Yesterday, I appeared before the Jacksonville City Council to explain the corrective actions we will take to ensure that incidents like these do not occur again. Some of these actions were begun prior to the discovery of contract improprieties, and others directly address deficiencies that were recently revealed. The action steps are as follows:

    * The establishment of a high-level in-house ethics officer for the City of Jacksonville. I have asked Carla Miller to take on this important responsibility. Ms. Miller, a former federal prosecutor, former chair of the Jacksonville Ethics Commission and internationally-recognized expert on government ethics, has served our city well over the past few years as a volunteer. She has been an invaluable resource to municipalities throughout the nation and governments throughout the world in this regard. I have asked that she work closely with the Jacksonville Ethics Commission, chaired by Mary Alice Phelan upon assuming her position. The Commission has done important work that should be built upon.

    * A comprehensive review of the city’s ethics code, to be carried out by the Jacksonville Ethics Commission, chaired by Mary Alice Phelan, in conjunction with Ms. Miller. While our ethics code was one of the first of its kind in Florida and is considered a model for other cities, it is time for a review and update. I will request that this vital work be completed within the next several months.

    * The establishment of an ethics hotline to facilitate disclosure of ethical concerns by city employees. The hotline will be available 24 hours a day, seven days a week, and will be completely confidential. I encourage any city employee who believes they know of a legal or ethical breech to call this hotline immediately if their concerns are not appropriately addressed by their supervisor. All reports will be investigated, and we will use the information received to identify opportunities to improve internal controls in the future. The hotline number is (904) 630-1015. The reporting system may also be accessed through our Web site, www.coj.net.

    * All city employees will be asked to agree to a code of conduct developed by my team in conjunction with Ms. Miller, and will be required to attend a training class regarding the code. The jobs we hold in government are a public trust, and we must execute our duties in a manner that is above reproach, never forgetting that the resources we utilize belong to the taxpayers.

    * As part of the government reorganization I have proposed, we will create the position of Inspector General for the City of Jacksonville. I have asked Pamela Markham, presently the Deputy Chief Administrative Officer and a longtime auditor in the Office of the City Council Auditor, to carry out this important function, reporting directly to me.

    * Mrs. Markham will establish an internal working group to assist in the implementation of new compliance and internal control systems. Our city employees are good people nd rules already exist to ensure that the public trust is maintained. However, we need to make sure those rules are being followed. I will ask the group to ensure that accountability measures are in place at every level of the organization.

    * I will recommend the city engage a nationally recognized accounting firm to assist in the establishment of an internal controls program, primarily in our procurement department and each using agency that purchases goods and services. While I am hopeful that a firm will participate on a pro bono basis, I am prepared to dedicate up to $50,000 to such a project.

    * As part of my proposed reorganization of the government, internal functions like human resources, procurement and accounting will be consolidated into one area. This will eliminate duplication and redundancy, improve communication within the government, and eliminate “silos” that have come to exist over the years, promoting greater transparency and collaboration.

In addition to the steps detailed above, we will review the city’s purchasing code and tighten our practices. Devin Reed, the city’s present Director of Procurement, has suggested a number of improvements, including:

    * City procurement staff, effective immediately, will establish and incorporate specific minimum requirements in all bid documents. Minimum requirements will be located in a prominent place within the solicitation document and will consist of objective pass/fail criteria that clearly communicate whether the bid or proposal can go forward. Procurement staff will bear the responsibility of ensuring that all minimum qualifications are met in every instance.

    * All requests for awards will be advertised, so the public has the opportunity to know what services the city contemplates using. Mr. Reed will immediately develop procedures for posting these awards.

    * Using departments will no longer be allowed to open ANY bid documents. Bids may only be opened by procurement staff, and failure to comply will disqualify the award of the bidder.

    * The Procurement Department will continue with the implementation of new software for contract monitoring. All ongoing contracts, going back to the beginning of my first term, will be entered in the system in order to provide an electronic backup to staff efforts to ensure compliance.

    * City awards committees, when reviewing proposals, will no longer be allowed to approve any vendor or service with any conditions attached. At the time the awards committee meets to make selections, the proposals must be complete or the committee will reject the award… period.

    * All personnel throughout the government who deal with procurement will receive intensive training to make sure they know what is expected of them and to eliminate future errors.

Much of what I will propose is contained in the Taxation, Revenue and Utilization of Expenditures (TRUE) Commission’s recommendations from this spring. The members of this commission deserve our collective gratitude for their work to provide meaningful recommendations. In this report, they identified substantial strengths in our processes, but they also found important opportunities to improve.

As I said earlier, these are demanding times for our city. We are grappling with financial issues that will affect us all for generations to come, while adjusting to the fact that our state legislature is now willing and able to interfere with home rule. At the same time, we are working to address serious lapses in judgment which led to the contract awards described above.

When I took office, I pledged to work day and night to be the best possible steward for the taxpayers of this city. Implicit in that pledge was a promise to maintain the highest standards of accountability and integrity in the operation of our government. I deeply regret that recent events have cast doubt upon that promise and my administration, and I am committed to addressing the failures that resulted in these errors.

In closing, I want to thank the people of Jacksonville for their faith and confidence. You may be assured that I have recommitted my efforts to making sure that your city government is worthy of your trust.

As we prepare to move forward, I ask you to join me in re-focusing on the priorities we established four years ago: growing our economy; creating jobs; raising per capita income; responsibly managing growth; enhancing early literacy; and maintaining our quality of life, including public safety, infrastructure, and the preservation of our rich and diverse natural resources.

I ran for mayor because I believed in the future of Jacksonville and I wanted to make a difference. I still believe in Jacksonville’s future, and I know that the challenges we face today can be resolved if we meet them together. With hard work, forthright attention to our weaknesses, and faith in each other, we can make Jacksonville the great American city in which we all want to live. Thank you again for your confidence.

- John Peyton

[Jason]

Its great to see more government offices added to the straining budget because of his blatant screw up while social services and the likes take hits in their already empty pockets and lose personell.

[Steve]

Here's another choice thing regarding ethics:

http://www.bizjournals.com/jacksonville/stories/2007/08/27/daily16.html?f=et64&ana=e_du

Because his buddy got a bunch of contracts, he's going to make the rank and file take ethics training.

Isn't this like me as a parent burning down my house because I thought it would be a good idea to use a blowtorch in the living room, and in response, making my kids take fire safety training?

[Lunican]

Well you have to remember, this was a "massive failure of the system". Peyton had nothing to do with it.

[JUSTDAVE]

Does he really expect us to believe that the people fired so far over this are more guilty of misconduct than him? Please John explain how they were guilty yet you are not.

[Lunican]

Ex-Boeing director gets jail term
Friday, 18 February, 2005, 17:44 GMT

An ex-chief financial officer at Boeing has received a four-month jail sentence and a fine of $250,000 (£131,961) for illegally hiring a top Air Force aide.

Michael Sears admitted his guilt in breaking conflict of interest laws by recruiting Darleen Druyun while she still handled military contracts.

Ms Druyun is currently serving a nine month sentence for favouring Boeing when awarding lucrative contracts.

Boeing lost a $23bn government contract after a Pentagon inquiry into the case.

The contract, to provide refuelling tankers for the US Air Force, was cancelled last year.

Pentagon inquiry

The Pentagon revealed earlier this week that it would examine eight other contracts worth $3bn which it believes may have been tainted by Ms Druyun's role in the procurement process.

Boeing sacked Mr Sears and Ms Druyun in November 2003 after allegations that they had violated company recruitment policy.

Ms Druyun had talks with Mr Sears in October 2002 about working for Boeing, while she was still a top procurement official within the Pentagon. She subsequently joined the company in January 2003.

Ms Druyun admitted that she had steered multi-billion dollar contracts to Boeing and other favoured companies.

Ethical issues

In documents filed in a Virginia court ahead of Mr Sears' sentencing, prosecutors blamed Boeing's senior management for failing to ask key questions about the "legal and ethical issues" surrounding Ms Druyun's appointment.

Mr Sears told prosecutors that no other Boeing officials were aware that Ms Druyun was still responsible for major procurement decisions at the time she was discussing a job with Boeing.

However, analysts believe Boeing may yet face civil charges arising from the scandal.

The Pentagon has investigated 400 contracts, dating back to 1993, since the allegations against Ms Druyun came to light.

Under scrutiny

Boeing's corporate ethics have come under scrutiny on several occasions in recent years.

Boeing was sued by Lockheed Martin after its rival accused it of industrial espionage during a 1998 contract competition.

Boeing apologised publicly for the affair - although it claimed it did not gain any unfair advantage - and pledged to improve its procedures.

The Pentagon subsequently revoked $1bn worth of contracts assigned to Boeing and prohibited the company from future rocket work.

http://news.bbc.co.uk/2/hi/business/4277927.stm

[Steve]

Does he really expect us to believe that the people fired so far over this are more guilty of misconduct than him? Please John explain how they were guilty yet you are not.

I'm sure that the rank & file in procurement just accidentally gave a contract to Teagle, who just happened to be the only vendor not on the approved vendor list

[midnightblackrx]

With the increase in property values, the COJ benefited with more property tax revenue.  Did they put it away to save for a time down the road?  No,  they've continued to spend what was coming in. 

Thanks to Gov Crist for taking control of a situation that saw some cities, counties, and municipalities double their property tax revenue in the last 5 years due to the boom in the real estate industry.

Vote yes on Amendment 1 and show the COJ that they have to be fiscally responsible with our money just as we are.