On 8.1.25, Municipal Auditor Arik Mashiach presented the Auditor's Report for 2023. The report is a comprehensive document, providing a snapshot of the functioning of the municipality and its units during the past year.
As is known, the Auditor's Report is a central oversight tool designed to ensure proper management, efficiency and transparency in municipal institutions. The report includes an in-depth review of the municipality's activities in diverse areas and examines the compliance of the relevant parties with the established goals. The presentation of the report provides the city's residents and decision-makers with essential information that helps advance improvement processes and adapt services to the changing needs of the public.
This year's report included five topics that were examined during the year, with the aim of upgrading and streamlining the management of municipal resources and municipal revenues, and ensuring a more quality and focused service for residents. The audits were carried out in various areas including budget management, collection, maximizing revenue sources, managing municipal projects, and resident services. Each report included a comprehensive review of the current situation, along with practical recommendations for improvement.
The first issue raised by the auditor in the report was the issue of improvement levies. The improvement levy is a mandatory payment collected from an increase in the value of real estate following the approval of plans, the granting of easements, or a permit for an exceptional use. According to the law, the resident is obligated to pay when exercising rights in the property.
As part of the audit, an examination was conducted of the adequacy of the calculation, billing, and collection processes of the improvement levy, including the use of information systems and work processes in the Improvement Department and the Engineering Administration.
The audit revealed that despite the increased workload, the municipality did not allocate appropriate resources to handle the issue. Mashiah noted in the report that despite a 267% increase in the number of applications between 2014 and 2021, there were no additional standards or adjustments in the Engineering Administration, which is responsible for this area.
The auditor also determined that there were deficiencies in contract agreements with appraisers and a lack of supervision of reduced rates.
The auditor added that there was no use of digital tools and supervision mechanisms and that monitoring was done using manual Excel files. In addition, the auditor noted that there were no organized work procedures and that the department's main areas of activity were not anchored in organized procedures, were not uniform and did not include job definitions, schedules, and supervision.
In conclusion, Mashiah presented the mayor with a number of recommendations for streamlining the system, including: examining additional standards or establishing a new department that would coordinate the improvement area, and of course demanded updating and implementing organized work procedures using digital systems that would ensure full and uniform documentation of processes and monitoring of payments.
The second report submitted by the municipal auditor dealt with the issue of maximizing revenue from reader votes. In this report, Mashiah points to significant gaps in the management of bids in “Calls for Proposals” in the municipality.
This is a mechanism that allows local authorities to receive budgets for various projects and ventures. The report shows that the optimization of this important resource is not being carried out optimally. The municipal auditor states that one of the reasons for this is the lack of a central factor that would integrate and centralize all publications to offer bids relevant to the municipality. According to him, the municipality does not have a central factor responsible for managing and monitoring publication for bids. In addition, there is no organized database that allows control over all requests, submissions, and decisions received.
The report also states that the computerized system used to manage Calls for Proposals is not updated and does not allow for effective monitoring. In addition, financial data is not entered into the system in an orderly manner, which makes it difficult to make informed decisions.
In addition, decisions on submitting applications or waiving them were not documented. These processes harm the municipality's ability to realize significant economic potential. The auditor examined a sample of the implementation of this issue and found that some were not exhausted due to partial implementation or failure to meet requirements, which led to financial loss.
The auditor made a number of recommendations, including appointing a bids coordinator who will coordinate the field in an orderly manner and carry out close monitoring. Creating an all-inclusive central and updated database. Updating and implementing a computerized system that will assist in decision-making and financial monitoring. Writing clear procedures on the distribution of responsibility and documenting decisions.
In the report's conclusion, the municipal auditor noted that proper management of the bids system could yield significant financial resources to the municipality and assist in the implementation of important projects for residents. Therefore, he determined that implementing the recommendations in the report could bring about positive change in this critical area.
The third report by the municipal auditor dealt with the issue of service availability and accessibility to residents. The report emphasized efforts to improve service to city residents, alongside proposals to advance the municipal service system and adapt it to the needs of residents. The municipal auditor noted that during 2023, the municipality began a service improvement plan and even began headquarters work towards its implementation, but the outbreak of the "Iron Swords" war led to the freezing of the plan and now it must be renewed.
In the summary of the report, the auditor submitted key recommendations for improving the service, including setting measurable goals for examining the quality of the service, appointing a designated entity to inspect the service, and submitting periodic reports to the municipal administration. Upgrading the municipal website, defining a uniform structure for information, mapping and adding online forms, and adding feedback to residents to improve the content. Translating the website into additional languages and moving to submitting documents online as the default.
The fourth report dealt with the way in which the financial guarantee management system worked in the Modi'in Maccabim Re'ut municipality and the municipal companies. The report shows that there are no regulated procedures for managing bank guarantees, both in the municipality and in the municipal companies. Among other things, there is no procedure for checking against forfeited guarantees. It was also found that the computer systems do not have an automation system that allows for organizational memory or sufficient control.
The municipal auditor recommended switching to an advanced computer system that would automatically manage and alert on changes and important dates in guarantees. He also demanded that new procedures be established that would regulate the processes for managing guarantees, forfeiture, and release. The auditor also determined that the municipality and the municipal companies are required to adapt their activities to the accounting regulations.
The fifth report dealt with the fight against false registration for schools in the city. This report was written in the shadow of the growth of the phenomenon and the municipality's activities to deal with this issue in which students who are not residents of the city register for schools in the city by falsely changing their addresses.
The auditor noted that the Education Administration has often identified false registration by residents of neighboring municipalities, who provide a false address in order to register for educational institutions in the city, thereby taking the places of city residents. This report took shape after employees of the Education Administration's registration department noticed suspicious patterns regarding fictitious documents.
The report submitted to the mayor recommends taking a number of steps in order to combat the phenomenon of false registration, prevent its impact on residents, and increase supervision and enforcement of the school registration process: conducting more rigorous inspections, with an emphasis on secondary schools, which will be required to verify that the students are indeed residents of the city. Increasing requirements for proof of address, as well as contacting the Ministry of the Interior, to discuss the ease of changing addresses without a thorough check, which allows for the registration of duplicate families at the same address. Increasing enforcement against those who register falsely, and removing them from educational frameworks.
The auditor's report included, as always, an analysis of public inquiries and, of course, monitoring the correction of deficiencies in previous audit reports. Among other things, the municipal auditor referred to a report from 2019, which dealt with the issue of encroachments on public spaces. The municipal auditor updated that a committee was established by the city council to monitor the progress of handling the issue, alongside continued monitoring by the Audit Committee.
Chairman of the Audit Committee, Council Member Ran Segev: "The goal of the audit is to improve and streamline the work of the municipality and thereby improve service for the city's residents. The main part of the report deals with maximizing revenue and expanding the projects in the city budgeted by government ministries - which will allow us to provide more services and more frameworks to all residents. I would like to take this opportunity to thank City Comptroller, Arik Mashiach, for leading the audit process, the members of the committee for their substantive and professional work, and Mayor Haim Bibas, for accepting the recommendations and implementing them.
"In the coming year, the committee under my leadership will closely monitor the handling of the deficiencies raised in the report, out of a commitment to continuous improvement in the work of the municipality and service to residents."
Click here to read the 2023 Municipal Audit Report
