May 04, 2018
DENVER – After initially resisting an audit, the Denver Zoo has now made significant strides to better fulfill its agreement with the city and to fortify its board’s oversight, a follow-up report from Auditor Timothy M. O’Brien, CPA, notes.
These improvements are based on the recommendations from a report Auditor O’Brien’s office completed in 2017, the first-ever city audit of the zoo since it was founded in 1896. Auditor O’Brien’s office noted the zoo’s marked progress in the follow-up audit released this week.
“We all love the elephants, bears and penguins at the zoo, but these recommendations were really for the human taxpayers,” Auditor O’Brien said. “These changes will help ensure the place our furry and feathered friends call home is well-run.”
Until Auditor O’Brien’s request at the end of 2015, the cooperative agreement between the zoo and the city had never been audited. At first, zoo leaders resisted the Auditor’s authority. After intervention from the City Attorney’s Office and the mayor, zoo officials fully cooperated with the initial audit and with our recent follow-up work.
After accepting the Auditor’s eight recommendations, the zoo made changes to ensure the continued excellence of services and to promote engagement and accountability from the Denver Zoological Foundation’s board members.
The Zoo Foundation and Denver’s Parks and Recreation Department now have a provision in their agreement ensuring the zoo maintains its USDA license and accreditation with a leading national zoological association. The zoo became an accredited member of the Association of Zoos and Aquariums in 1976. However, until now, the cooperative agreement did not require the accreditation be maintained.
The original audit found both the city and zoo were not following certain terms of the cooperative agreement. The zoo’s board also had not formally submitted an annual budget proposal to the city for approval before the board adopted it.
Since then, the cooperative agreement has been updated with two amendments, one to address non-compliance with the agreement and one to update the section on board governance. Under the new amendments, appropriation and payment of utilities is now consistent with current practice.
The audit also found the board did not follow best practices regarding training, attendance and evaluations and oversight of the CEO. At the recommendation of the audit, the Denver Zoological Foundation’s Board of Trustees adopted new bylaws to establish a 70 percent attendance requirement. The board also added the executive director of the Department of Parks and Recreation to the executive committee and later to the new Board of Governors. The board now has formal new member training and documentation of the authority of the Board of Governors, the primary governing body.
Two of the eight accepted recommendations were only partially implemented at the time of the follow-up. The board implemented three of five recommended best practices for governance. The two best practices not adopted were developing a process for conducting regular reviews of bylaws and outlining requirements for obtaining independent legal advice.
The other partially implemented recommendation involved defining the roles and responsibilities for monitoring. The Department of Parks and Recreation and the zoo’s board developed a “calendar of events” to clearly define the responsibilities of each party. However, this is a pilot program that won’t be finalized until later this year.
The zoo receives money from both the city’s general fund and from the Scientific and Cultural Facilities District. A special revenue fund is used to pay for operational support for water and utilities. The zoo also receives bond money from the city, including $2.2 million for the new tiger exhibit.
“I’m pleased my audit team’s hard work helped strengthen operations at the zoo,” Auditor O’Brien said. “Our goal is to work with agencies to encourage improvement, and whether that’s the zoo or other city agencies, we’ll follow Denver taxpayer dollars to make sure they’re used effectively and efficiently wherever my authority allows.”