Brief remarks about the Good Government Hotline's history & importance

First Reading of Ordinance Amending Chapter 25 to Establish a Waste, Inefficiency and Abuse Hotline for Multnomah County. Presenters: Jennifer McGuirk, Auditor & Marc Rose, Hotline Director. 

Hotline Director Marc Rose & County Auditor Jennifer McGuirk testify about the hotline's importance
Photo by Motoya Nakamura, County Communications

Good morning, Chair and Commissioners. I’m Jennifer McGuirk, the County Auditor, and I use she/her pronouns. I’m pleased to be here this morning with Hotline Director Marc Rose for the first reading of the ordinance affirming the county’s hotline for inefficiency, waste, and abuse.

Since its establishment in 2007, the hotline has been an important resource for county employees and anyone who lives in Multnomah County. People can call the hotline 24 hours a day or submit reports online. They can make reports anonymously, but even if they don’t, we protect the identity of each reporter to the hotline to the fullest legal extent. The Auditor’s Office operates the hotline in accordance with state laws for local government waste hotlines. The purpose of this ordinance is to affirm these practices and formalize them. 

In a moment, I will make some remarks about the hotline’s history, and Marc will talk about why it is important to have a hotline. I’ll then provide some closing remarks about why the best place for the county’s hotline is the Auditor’s Office.

Before I make my own brief remarks, I wanted to share a statement of support from Kristine Adams-Wannberg, who is not able to join us today. Adams-Wannberg is the Washington County Auditor and a past president of the Association of Local Government Auditors. 

Auditor Adams-Wannberg wrote the following: 

Dear Members of the Board of Multnomah County Commissioners,

I am pleased to provide my full support for the codification of the county's hotline. This is a critical service provided to the public that helps the county examine potential inefficiencies, waste, and abuse. The program's existence and its codification represent a significant commitment by county leadership to good government and to using the people's resources and power in a responsible manner.

The hotline program is located in an office continually recognized for its excellence. The Multnomah County Auditor's Office is a well-known leader in the field of local government auditing. The County Auditor's administration of the program and experienced staff contribute to the hotline's reputation for thorough research, objectivity, and confidentiality.

Auditor Adams-Wannberg closed her remarks by saying that she is pleased to support this codification. 

I have provided a copy of Auditor Adams-Wannberg’s statement to the Board Clerk. 

Now for my own remarks. 

In 2007, LaVonne Griffin-Valade, who now serves as our Oregon Secretary of State, established the hotline as part of her tenure as County Auditor.  Since 2007, the Auditor has operated the hotline continuously to provide county employees and community members with a confidential method for reporting suspected fraud, waste, inefficiency, or abuse of position in county government. 

When Secretary Griffin-Valade established the hotline, it was partly in response to a case of embezzlement by a county employee. She established the hotline with the support of the County Chair and Commissioners. So it is fitting that we are now establishing the hotline in our County Code under the Auditor’s operation - with the Auditor’s consent, and the support of the Chair and, I hope, the full Board. 

I’m now the third County Auditor privileged to oversee the hotline. I want to thank Secretary Griffin-Valade for creating the hotline, and former County Auditor Steve March for his stewardship of the hotline. And I want to thank all of my staff for their work to promote the hotline and support investigations, particularly Hotline Director Marc Rose, Fran Davison - who is now retired from the Auditor’s Office - and Operations and Audit Director Annamarie McNiel. 

I’d now like to invite Marc Rose, the Hotline Director, to share some remarks. 

Good morning Chair and commissioners. Thank you, Jennifer. For the record, my name is Marc Rose, I use he/him pronouns and I’m the Hotline Director in the Auditor’s Office. Thank you, Chair and commissioners, for considering this ordinance regarding the hotline. The hotline is a valuable community and employee resource. I”d like to say a few words about the value of hotlines in general, and our hotline in particular.

Each year, the Association of Certified Fraud Examiners conducts a survey, which provides us with some statistics about the value of hotlines. 

  • Organizations with hotlines detect fraud more quickly and have losses that are about half that of organizations without hotlines. There are two things at play here - tips to hotlines help identify fraud schemes more quickly and the presence of a hotline acts as a deterrent in the first place.
  • And when it comes to detecting fraud, the most effective fraud detection method is tips from employees or community members. In last year’s survey, which included about 2,100 cases,  42% of fraud schemes in the survey were detected by tip, which is nearly 3 times the detection rate of any other fraud detection method. For the record, the second most effective detection method was audits.

In terms of our hotline, in particular:

  • Over the past 5 years, we’ve received between 80-105 reports to the hotline each year.
  • We received 82 reports last year, with 61 being county-related. For those unrelated to the county, we were able to, in most cases, direct the reporter to the appropriate resource.
  • The hotline is intended to receive fraud, waste, inefficiency, and abuse of position reports, but it is available for employees and community members to make reports of any kind. We triage each report and if we cannot investigate, we help reporters find the right resource. During the early stages of COVID, for example, we received workplace safety-related reports that we passed along to management.
  • Thanks to tips, in 2022, we substantiated three waste, inefficiency, or abuse of position reports.
    • We identified $525,000 in unallowable expenses, including duplicate payroll expenses, billed to the county by a provider. Once we identified the unallowable expenses, the county was able to work with the provider to make corrections.
    • We identified abuse of position by a county employee. A county employee used their position to obtain financial benefit for themselves, in the amount of $10,000. Thanks to a tip to the hotline, this abuse of position was identified and the employee’s second attempt to obtain this benefit was thwarted.
    • And we identified inefficiency with the way that Animal Services has been using its restricted-use donation accounts. Animal Services accumulated about $2 million in donations and board allocations in these accounts over the last five years, but has spent only about 30 percent of the funds over those five years.
  • Additionally, in the past, hotline staff have worked with the DA’s Office and Sheriff’s Office to conduct forensic accounting. This helped lead to the conviction of two prior county employees who were stealing money through purchase card schemes. The losses in those cases exceeded $65,000.

In closing, implementing this ordinance will strengthen and solidify the hotline’s presence as a valuable resource. Thank you for taking the time to deliberate on the ordinance. And I will turn it back over to Jennifer.

Thank you, Marc. I’d like to close by saying that the Auditor’s Office is the best home for the hotline in our county because of my office’s standards, expertise, and commitment to serving the public interest. The County Charter requires the Auditor to adhere to generally accepted government auditing standards. These require us to take steps in every audit related to detecting and preventing fraud, inefficiencies, waste, and abuse of position. The standards also acknowledge that government auditors frequently investigate alleged fraud, violations of agreements, or abuse. To be able to provide these services, the Auditor’s Office includes a certified fraud examiner, a certified public accountant, and professionals with the deep skills necessary to conduct investigations. 

The auditing standards state that a distinguishing mark of a government auditor is acceptance of the responsibility to serve the public interest. One way that my office accepts this responsibility is by operating the hotline, and we appreciate everyone who contacts the hotline when they see something concerning in our county government. We recognize how dedicated and hard-working the vast majority of county employees are, and know that it is important to hold people to account when they do not demonstrate those same high standards. 

The hotline is a critical function for ensuring that our county government resources are used efficiently and ethically and that the government is transparent and accountable. 

Chair and Commissioners, I thank you for your deliberation on this matter.