COMMERCIAL DRIVEWAY BILLING AUDIT ' ¦ ¦
' CITY OF CHICAGO
JOSFPH M FERGUSON IN S P F CTO R G E N E RA L
OFFICE OF INSPECTOR GENERAL
740 NORTH SEDGWICK STREET, SUITE 200
201" JUL " | AH 10: 51* CHICAGO, ILLINOIS 60654
TELEPHONE (773)478-7799
... r , L FAX (773) 478-3949
JULY 1, 2019
TO THE MAYOR, CITY COUNCIL, CITY CLERK, CITY TREASURER, AND THE RESIDENTS OF THE CITY OF CHICAGO:
The City of Chicago Office of Inspector General (OIG) has completed an audit of the Chicago Department of Transportation's (CDOT) billing process for commercial driveway permit annual fees. The purpose of the audit was to determine whether CDOT accurately and completely billed commercial property owners for driveways that use the public way.
Based on the audit results, OIG concludes that the City is losing over $1 million a year due to incomplete and inaccurate billing. Specifically, CDOT either did not bill, or inaccurately billed, an estimated 6,713 permitholders, resulting in an annual revenue loss between $1.1 million and $1.5 million. If collected, this would increase driveway permit revenue by 39%-54%. Furthermore, CDOT has no confidence that all relevant driveways are recorded in its current driveway permit-system; the City is thus likely forgoing an unknown amount of additional revenue by not billing all relevant property owners. Finally, OIG found that the City does not actively pursue payment for driveway permit fees that are past due. There were at least 11,561 active permits with $3.8 million in overdue fees in CDOT's records.
To address these concerns, OIG recommends several steps that CDOT should take to correct the data problems currently hampering its billing operations and to prevent such probl ems in the future. We also recommend that CDOT collaborate with other departments to include driveway permit fees in the City's standardized debt collection processes.
CDOT agreed with our recommendations, committing to correct its records, collect unbilled fees, develop standardized procedures, and implement other corrective and preventive measures. CDOT also said it will collaborate with other departments to upgrade its data system and ensure that past clue fees are collected.
We thank CDOT staff and management for their cooperation with this audit. We also thank the Office of Budget and Management employee who described the Office's
!GO IIC AGO PRC. I OIG TIP LINE (866) /,/,6-^7S4 | TTY (77;;) 478-2066
efforts to identify driveway owners, as well as the Department of Finance personnel who explained the City's standardized debt collection and verification processes.
Respectfully,
Joseph M. Ferguson Inspector General City of Chicago
OIG Fil E ;.'17-0-V79
CDOT Commercial Driveway Billing Audit: July I, M0I9
TABLE OF CONTENTS
EXECUTIVE SUMMARY |910|A CONCLUSION 4
B FINDINGS ... .. 4
C RECOMMENDATIONS .. |910|D CDOTRESPONSE |910|BACKGROUND|910|
DRIVEWAY PERMIT FEE RATES AND WAIVERS|910|ROLES IN THE DRIVEWAY PERMITTING PROCESS 7
FINDINGS AND RECOMMENDATIONS 9
FINDING 1 CDOT EITHER DID NOT BILL OR INACCURATELY BILLED AN ESTIMATED
6,713 PERMITHOLDERS, RESULTING IN AN ANNUAL REVENUE LOSS
BETWEEN $11 MILLION AND $1.5 MILLION 9
A. UNBILLED PERMIT FEES 9
B INACCURATELY BILLED PERMIT FEES 11
CONTRIBUTING FACTORS 12
THE NSR/Suntrack system is unnecessarily complex and likely incomplete 12
CDOT lacks written and standardized driveway billing procedures 13
CDOT lacks a key tool needed to monitor driveway billing 14
FINDING 2: THE CITY DOES NOT ACTIVELY PURSUE PAYMENT FOR PAST-DUE
DRIVEWAY PERMIT FEES 26
OBJECTIVE, SCOPE, AND METHODOLOGY 28
OBJECTIVE 28
SCOPE 28
METHODOLOGY 28
STANDARDS 29
AUTHORITY AND ROLE 29
APPENDIX A: CENTRAL BUSINESS DISTRICT (CBD) BOUNDARIES 30
APPENDIX B: PROCESS FLOW FOR STAGNANT PERMITS WITH UNRESOLVED
PROPERTY OWNERSHIP 31
APPENDIX C: PERMITS BY CASE STATUS AND OIG-DEFINED CATEGORY 32
APPENDIX D: OPPORTUNITIES TO SIMPLIFY PERMIT DESIGNATIONS IN
NSR/SUNTRACK 33
APPENDIX E: PERMIT SCREENSHOTS WITH NSR/SUNTRACK DATA FIELDS 34
PAGE I
OIG Fil.E ft 17-0479
ClOOT Commercial Driveway Billing Audit
ACRONYMS
CBD Central Business District
CDOT Chicago Department of Transportation
COAL Collections, Ownership, and Administrative Litigation in Department of Law
DOB Department of Buildings
DOF Department of Finance
DOIT Department of Innovation and Technology
DOL Department of Law
MCC Municipal Code of Chicago
OBM Office of Budget and Management
OIG Office of Inspector General
PAGE 2
OIG FILE /i IV-O-'V/O '
CDOT Commercial Driveway Billing Audit July 1, 2019
bills an estimated 6.713 permitholders
IF COLLECTED. DRIVEWAY PERMIT REVENUE WOULD INCREASE BETWEEN 39%-54%
THERE WERE AT LEAST
HILLy&l 11.561 ACTIVE PERMITS
/vay Billing Audit
QIC FILL !;17-0'i79 CDOT Commercial Drivev
EXECUTIVE SUMMARY
The City of Chicago Office of Inspector General (OIG) conducted an audit of the Chicago Department of Transportation's (CDOT) billing process for commercial driveway permit annual fees The purpose of the audit was to determine whether CDOT accurately and completely billed commercial property owners for driveways that use the public way.
CONCLUSION
OIG concludes that the City is losing over $1 million a year due to incomplete and inaccurate billing.
B. FINDINGS
OIG found that CDOT either did not bill, or inaccurately billed, an estimated 6,713 permitholders, resulting in annual revenue loss between $1.1 million and $1.5 million. If collected, this would increase driveway permit revenue by 39%-54%.
The most common reason CDOT did not bill for annual driveway permit renewals was that the identity of the property owner was either unknown or disputed, and CDOT had not researched and resolved the ownership question. OIG identified a variety of other reasons why some permits went unbilled, including missing addresses and unwarranted waivers. Notably, we found similar problems, including incomplete data, in our 2015 audit of CDOT's Loading Zone and Residential Disabled Parking Sign Processes.1 In response to that audit, CDOT stated that it intended to work with the Department of Innovation and Technology (DOIT) to upgrade to a new system in 2016. That upgrade has not yet occurred, and the City continues to lose millions of dollars each year.
In addition, CDOT has no confidence that all relevant driveways are recorded in its current driveway permit system. The City is thus likely forgoing an unknown amount of additional revenue by not billing all relevant property owners.
Finally, OIG found that the City does not actively pursue payment for driveway permit fees that are past due. There were at least 11,561 active permits with $3.8 million in overdue fees in CDOT's records. CDOT stated that it had previously considered tying driveway permits to the permitholder's deed, water bill, driver's license, or business license, but that these ideas had not "gained traction." The Department of Finance
1 City of Chicago, Office of the Inspector General, "I oaciing Zone and Residential Disabled Sign Processes Audit", June 3, 2015,12, accessed November 29. 2010, htios/Zigclvcacio oig/wp-contei"M:/Lioloads/20!5/Q5/Loading Zono-a.id-DiSjb oc- ^a; kino Signs-Audit ncif
PACE 4
CDC) I Commercial Driveway Billing A: iciit July 1. 2019
stated it does not include driveway permit fees in the City's standardized debt collection processes because CDOT's property ownership data is unreliable. This has created a self-perpetuating cycle; the errors in CDOT's ownership records prevent the Department from using existing City processes to correct, its ownership records. CDOT stated it had previously considered obtaining property ownership data from Cook County, but that the data was "not easy to acquire" and required payment.
RECOMMENDATIONS
OIG recommends that CDOT correct the data problems currently hampering billing and implement procedures to prevent such problems in the future. Specifically, OIG recommends that CDOT,
remove or consolidate database fields, as well as options within those fields that are redundant, rarely used, or unnecessary;
identify and record driveways missing from its records;
collaborate with DOIT to upgrade its system and include features to prevent future data problems;
document standardized procedures related to the driveway permitting, billing, and monitoring processes; and
develop monitoring tools, such as automated reports and/or notifications, to detect permits at risk for inaccurate billing or non-billing.
Finally, we'recommend that CDOT collaborate with the Department of Finance, the Department of Law, and other departments as necessary to include driveway permit fees in the City's standardized debt collection or verification processes.
CDOT RESPONSE
In response to our audit findings and recommendations, CDOT stated that, in collaboration with DOIT, it will migrate driveway data from the NSR/Suntrack system to the Infor Public Sector (IPS) system, formerly known as Hansen. During that transition CDOT will have "an opportunity to evaluate how it processes and monitors driveway data, including implementing the corrective and preventive measures described in [this report]." CDOT also committed to reviewing and correcting unbilled and inaccurately billed driveway records, assessing current workflow processes, developing standardized policies and procedures for both the NSR/Suntrack and IPS systems, providing training to staff, and developing monitoring reports. Regarding the pursuit of payment for past due driveway permit fees, CDOT stated it would collaborate with the Departments of Finance and Law to determine the most effective method for collecting past due fees.
The specific recommendations related to each finding, and CDOT's response, are described in the "Findings and Recommendations" section of this report.
PAGE b
II. BACKGROUND
The Municipal Code of Chicago (MCC) requires anyone whose driveway runs "over, across or upon any public sidewalk or public parkway" to obtain a permit."
The driveway permit fee is based on,
the "class" of the property (residential or commercial),3
the width of the driveway, and
whether or not the driveway is in the Central Business District (CBD)/'
A. DRIVEWAY PERMIT FEE RATES AND WAIVERS
While residential driveways require only a one-time permit fee of $10, commercial, driveway fees are due annually and range from $100 to $4,000. Figure 1 provides the current and historical fee rates.
¦' MCC y I0-20-405
•'• MCC § 10-20-420 defines two categories of properties Category A covers residential properties wii h four' units or less Category B covers all other properties, including residential buildincjs with five or more units For purposes of this audit, we refer to all Category B properties as "commercial" - MCC f; 10-20-420 the CUD boundar ics are delmed by MCC § 9-4-010 and depicted in Appends A
ay Billing Audit'
FIGURE 1: COMMERCIAL DRIVEWAY PERMIT" FEE RATES
HISTORICAL RA I LS
20 Outside CBD 12 Inside CBD 20 Outside CBD 10 Inside CBD 20 Outside CBD 02 Inside CBD 1993 All Locations 1900 All Locations
— Unto2S' r <- . $ioo.: $200 $100 $200 $100 $200 $68 $34
o -;,<¦',' rn .;q' _j -o • ¦' ,J $120 $240 $120 $240 $100 + $2 pet foot, above 25' $200 + $4 per foot above 25' $75 $68
o > 50'to 79' in > $175 $350 $175 $350
ffl £ 80'to 119" , $235 . $470/ $235 $470
u I 120'to 199' . $335 $670 • $335 $670
UJ -> LU ~ ?00 to 439 : $635 V $1270 $635 $1,270
^ Q 500' ? $2,000 $4,000 . $2,000 $4,000
Source OIG analysis of MCC § 10-20-420, Journal of Proceedings, December 4, 2002, Vo. 1, p 99026, Journal of Proceedings, January 14, 1997, Vol. 2, p 37782-3, Journal of Proceedings, December 21, 1988, Vol 2, p 37782-3.
Under the driveway permit ordinance, the only two entities explicitly exempted from annual fees, after the first-year fee is paid, are Chicago Public Schools and City Colleges of Chicago. In practice, however, CDOT stated that it waives fees for all properties owned by the City and its sister agencies,5 and engages with the Department of Law (DOL) to grant waivers to,
private companies on City of Chicago property;
other governmental entities at the local, state, and federal levels, as well as foreign governments;
railroads; and
an electricity supplier.6
The MCC also waives 20% of permit fees charged to public museums and not-for-profit hospitals.
B. ROLES IN THE DRIVEWAY PERMITTING PROCESS
The Department of Buildings (DOB) issues driveway permits for newly-constructed commercial buildings; the Permitting section of CDOT's Division of Infrastructure Management issues permits for existing buildings when there is a new owner. The
¦¦' the sister agencies arc Chicago Pi iblic Schools, Chicago Park District, Chicago 1 ransit Authority, City Colleges ot Chicago, Chicago I lousing Authority, and Public Building Commission See MCC § 1-23-010 ¦¦¦ This waiver relates to the Fiectricity infrastructure Maintenance f ee Law, 35 ILCS 645, which allows the City to collect an "infrastructure maintenance fee (IMF)" if it waives its fees for use ot public ways (e g , commercial driveway fees) For example, the City waives fees for Commonwealth Felisor Company, which holds 70 pomn;s covering 112 di iveways
-'AGC 7
property owner must, pay the initial fee in order to obtain the permit. I hereafter, CDOT is responsible for sending the owner annual renewal bills, and the Department: of Finance (DOI ) is responsible for collecting payment. Figure 2 depicts this process.
FIGURE 2: COMMERCIAL DRIVEWAY PERMIT PROCESS
CDOT
Issues ; Renewal Bill". : Annually:
New DOB Building ^ Issues Permit.
DOF
Collects Payment
Existing ^ CDOT
Building issues Permit
Focus of audit
As of August 2018, CDOT's driveway Permitting section consisted of a supervisor of driveways and three staff positions, one of which was vacant.
OIG FILL it 17 0-V79
CDOI Commercial Driveway Billing Audit July I,-2019
FINDINGS AND RECOMMENDATIONS
• INACG.URATELY BILLED(AN ESTIMATED,6/713^^
PERMITHOLDERS, RESUI^
MILLION. • vg: ;i-;Wg;K'"
CDOT did not bill an estimated 6,541 permitholders and inaccurately billed 172 permitholders resulting in net annual revenue loss between $1.1 million and $1.5 million.7 If collected, this would increase driveway permit revenue by.39%-54%.
A. UNBILLED PERMIT FEES
The most common reason CDOT did not bill for annual driveway permit renewals was that the identity of the property owner was either unknown or disputed, and CDOT had not researched and resolved the ownership question. As shown in Figure 3, OIG found an estimated 5,880 permits awaiting ownership resolution, representing $0.9 million to $1.3 million in annual revenue loss. CDOT said that some bills are returned unopened or disputed by the former owner after a property is transferred to a new owner. CDOT pauses the billing process for such permits until ownership is researched and resolved.8 CDOT stated that it had previously considered addressing the ownership issue by tying the driveway permit to the permitholder's deed, water bill, driver's license, or business license, but that these ideas had not "gained traction." See Finding 2 for further discussion of this topic. CDOT also stated it had previously considered obtaining property ownership data from Cook County, but that the data was "not easy to acquire" and required payment.
The City's Office of Budget and Management (OBM) assisted CDOT in 2018 and 2019 by reviewing permits in Wards 1 through 10 that were at least a year delinquent in payments. OBM researched ownership via property tax and deed records and determined whether driveways existed via Google Maps Street View. It billed the current of new owners of existing driveways and, as of April 2019, r eportedly collected $273,876 from 281 payees.
7 A perrnitholclcr can hold more than one permit However, for the purposes of tins audit, each permil was counted as having a unique permitholder
-¦ See Appendix B lor a flowchart depicting CDOT's process for addressing property ownership questions
PACt 9
OIG l"l(_!"_: ii\7 0479
CDOT Commercial Driveway Billing Audit July I, 2(rt9
In addition to ownership questions, OIG identified a variety of other causes for why some permits went unbilled. For example, 312 permits remained in a "Pending" status for over a year without resolution,9 and the fees for 96 permits had been incorrectly waived CDOT's records for two permits issued in 1996 noted that waivers were granted at the direction of aldermen.10 Prior to January 1, 2012, aldermen had the authority to waive driveway permit fees for individuals and entities, but such waivers should have expired on December 31, 2011.11
Eighty-one permits were unbilled because the driveways were incorrectly categorized in the system as "Removed." CDOT stated that for a driveway to be considered "Removed," the street curb and sidewalk must be restored. Restoration should be substantiated with supporting documentation, such as construction permits and photos. CDOT said that it did not effectively enforce this requirement in the past but intends to do so going forward.
|10 9|Of these 312 permits, 237 had a "Pending" case status and 75 had a "Pending" permit status CDOT explained that case status can remain pending for up to a year while a property is being built, but that the Department does not have any process to eventually review and resolve such cases Regarding permit status, CDOT was unaware that, its system allowed a permit status to be marked "Pending " See Appendix F for screenshots showing case status and per mit status
10 No aldermanic direction was noted for the other 94 permits, but OIG cannot state with certainty that
the absence of the explicit comment guarantees the absence of such direction
" City Council passed the prohibition on individual fee waivers in November 2011, and the relevant provision (MCC § 2-8-065) went into effect on January I, 2012 See City of Chicago, Journal of Proceedings November 16, 2011 Volume 1, 13793, 13998, 14011 accessed April 2, 2019, hts o //chicitvcler k s3 amazono/vS com/s3G public/document uploads/ioui rals
PAG F 10
OIG FIIF ff 17-0470
CDOl Commercial Driveway Rilling Audit
FIGURE 3; CDOT DID NOT BILL. AN ESTIMATED 6,541. PERMITHOLDERS, RESULTING IN ANNUAL REVENUE LOSS OF $11 MILLION TO $1.5 MILLION
Ipti
i Property owner was unknown and not researched 5,880 $960,537 to $1,334,627 |109|Case status was "Pending" and the permit was over one year old 237 $32,755 to $62,598 |109|Permit had no billing address 112 $20,515 |109|Fee was incorrectly waived 96 $19,225 |109|Existing driveway was incorrectly assigned "Removed" status 81 $4,627 to $24,776 |109|Status was "Pending" despite permit being more than one year old 75 $14,946 |109|"Able to Invoice" box was unchecked 60 $13,345
TOTAL 6,541 $1,065,950 to $1,490,032
Note the numbers of permits in categories 1, 2, and 5 are estimated based on samples from the related populations, therefore the annual revenue loss is an estimated range. The samples were based on a 95% confidence level and a 10% margin of error
In addition to estimating the annual revenue loss shown in Figure 3, OIG attempted to estimate the cumulative loss since the issuance of the permit. This required us to assume that driveway records had not changed since permit issuance, which we determined was a reasonable assumption for all but categories 1 and 5 in Figure 3. For categories 2, 3, 4, 6, and 7, we estimate a cumulative revenue loss of $511,031
B. INACCURATELY BILLED PERMIT FEES
OIG also found that CDOT inaccurately billed 172 permitholders, resulting in a net annual revenue loss of $22,398. As summarized in Figure 4, the most common cause of inaccurate billing was that CDOT misidentified the driveway location as inside or outside the Central Business District. In 19 instances, CDOT billed permitholders who should have received a full waiver.
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OIG HLE ;il7 0G7M
CDOT Commercial Driveway Billn icj Audit July I. 20\c>
FIGURE 4: CDOT INACCURATELY BILLED 172 PERMITHOLDERS RESULTING IN NET ANN UAL REVENUE LOSS OF $22,398
|109|Location was misidentified as inside or outside CBD!:' 151 . 529,955 |109|Permitholder should have received a 100% waiver 19 (S7,6''.5) |109|Perrnitholder received a 20% waiver although it was not eligible|99|$88
TOTAL 172 $22,398
Regarding category 1 in Figure 4, CDOT stated that its tracking system (NSR/Suntrack) does not interface with the City's geographic information systems, and therefore cannot automatically determine whether a property is inside the CBD based on its address. Instead, staff use a physical wall map to determine whether a property is inside the CBD.
In addition to annual revenue loss shown in Figure 4, OIG estimates that inaccurate billings resulted in a total cumulative loss of $151,216.
C. CONTRIBUTING FACTORS
In addition to the direct causes summarized in Figures 3 and 4, OIG identified the following factors as contributing to permit billing errors
1. THE NSR/Suntrack system is unnecessarily complex and likely incomplete.
Many aspects of the NSR/Suntrack system, as utilized by CDOT for driveway permitting, are susceptible to user error. For instance, a mistake in any of the following eight data fields can result in an unbilled or inaccurately billed permit fee:
Permit Status (3 options) • Case Status (23 options)
Driveway Status (7 options) • Fee Type (6 options')-
"Able to Invoice" Box • "CBD" Box
(Checked/Unchecked) (Checked/Unchecked)
¦ • Driveway Width13 • Billing Address
'•' OIG Pound 133 permits where a property located in the CBD was mistakenly identified as located outside the CBD and 18 permits where a property located outside the CBD was mistakenly identified as located in the CBI j OIG did not validate driveway width data in this audit
^AG't I
GIG G; [¦ ;r|7 0479
"DOT Got': isilei':ial Diivvway Rilling Audit
OIG found that many of those fields or options within those fields arc redundant., raiely used, or unnecessary. For instance, a case status of "Closed ¦ Dr iveway removed" (singular) is redundant to another case status, "Closed - Driveways removed" (plural).1'''
Further more, the NSR/Suntrack data is likely incomplete. CDOT stated that while it was not. aware of any specific unrecorded driveway, it. does "not have confidence that all commercial driveways in Chicago are captured" in the system. According to CDO'I, in Spring 2019, DOIT will migrate driveway data to a different system (Hansen) and implement a Hansen application for CDOT public right-of-way inspectors. This application will allow inspectors in the field to determine which driveways have permits and which do not.
OIG found similar problems, including incomplete data, in our 2015 audit of CDOT's Loading Zone and Residential Disabled Parking Sign Processes.15 In response to that audit, CDOT stated,
CDOT intends to retire the current NSR/Suntrack system and to incorporate impacted loading zone and other CDOT functionality and processes into a future deployment of Hansen 8, a more robust permitting system that is fully supported by DOIT... The incorporation of the loading zone process into Hansen 8 is currently scheduled for 2016.
Notwithstanding CDOT's stated intention, the Hansen migration has yet to occur, and the City continues to lose millions of dollars each year.
2. CDOT lacks written and standardized driveway billing procedures.
CDOT does not have written policies and procedures for the entry, maintenance, and monitoring of driveway permit data. Rather, practices are shared by word-of-mouth and, thus, susceptible to inconsistent interpretation and application.
Documentation of proper procedures is especially crucial considering the complexity of the various statuses and checkboxes in the NSR/Suntrack system. Compounding this problem, CDOT has no defined procedures for verifying that permits with billable driveways are billed. Specifically, it has no procedures to ensure,
• ownership questions are resolved;
" See Appendix D for more examples and Appendix f- for screenshots of the NSR/Suntrack system '¦' City of Chicago, Office of Inspector General, "Loading /one and Residential Disabled Sign Processes Audit", June .5, 2015, 12. accessed November 29, 2018, f ittos //igc^c.jgo Q' o.Gvp-
h7'V.....|' !'¦>
COOT Commercial Driveway Billinci Audit. , . 3uly 1.2019
new owners obtain driveway permits when a property is sold;
permits over one year old that remain in "Pending" case status are reviewed and billed once the driveway is built, and
permits with incomplete information, such as a missing billing address, are identified and resolved.
3. CDOT lacks a key tool needed to monitor driveway billing.
OIG found that CDOT management did not have the reporting capability needed to monitor driveway billing. When OIG launched this audit, we requested a data file of all commercial driveway permits. CDOT provided the report it had historically relied on to monitor or research driveway permits. That report, however, covered permits falling under only 6 of the 23 possible case statuses. To produce a complete report, CDOT had to bring in a former employee on a contract basis to edit the reporting criteria The new report included an additional 11,896 permits associated with 24,267 driveways—nearly twice the number of records contained in the report upon which CDOT had historically relied.
RECOMMENDATIONS
At the outset of this audit, CDOT acknowledged the existence of driveway billing errors, stating that a lack of staff and technological resources had prevented the Department from fixing them.10 CDOT requested OIG's guidance on the highest priority items to tackle first. Consequently, we order our recommendations based on the financial impact they will have on the City, beginning with the largest: property owner identification.
OIG strongly recommends that CDOT correct inaccurate or missing data that results in unbilled or inaccurately billed permit fees. Furthermore, we recommend that CDOT design and implement procedures to prevent future occurrences of the same issues; otherwise the mass of incorrect data will continue to grow. Below, we provide our specific recommendations to correct current billing errors in the left column, and our recommendations to prevent future billing errors in the right column.
''As discussed in the "Background" section, CDOT's driveway Permitting section consisted of a supervisor of driveways and three staff positions, one of which was vacant as of August 2010
OIG FILL" ;iT7-0479
CDOT Commercial Driveway Billing Audit
CORRECT CURRENT BILLING ERRORS 1 P RO PI - R TY OWNERUNKNOWN
Develop and implement; a strategy and timeline to identify the correct property owner for permits with the following case statuses:
Disputed-By Owner/Inspection Required
Disputed-Property Transferred
Suspense -Returned Mail/Ownership
Search
Closed Transfer to New Owner (if there is
no active permit for the same property)
Consider techniques like those used by OBM (described on page 9) and DOL's Collections, Ownership, and Administrative Litigation (COAL) group (which regularly conducts ownership research related to municipal code violations).
PREVENT FUTURE 1311. LING FRRORS
Develop and implement procedures to resolve property ownership issues as they are discovered 17 CDOT should consider developing such procedures in-house or potentially collaborating with COAL The procedures should ensure that, prior to closing a permit, an active permit for the new owner is opened.
2. PROLONGED PENDING CASE STATUS
Review permits that have had a "Pending" case or driveway status for over a year and determine whether the related driveways have been built. This may require contacting property owners, relying on internet-based photo evidence, or visiting the property.
Develop and implement procedures to update the case and driveway statuses of permits promptly upon the completion of construction, the opening of a business, or within a pre-defined reasonable time
3. MISSING BILLING ADDRESS
Identify all permits without a billing address and update the record with the correct address.
Update data-entry controls within the NSR/Suntrack system or any future system to make the billing address a required field
4. WAIVER ERRORS
Pursue back payment from permitholders whose fees were waived incorrectly (whether at a 20% rate or a full 100%) and provide
Implement procedures to ensure that, only waivers authorized under the MCC are granted To promote transparency and equity, CDOT should describe waiver
''The number of ownership issues should decrease if CDOT implements the recommendations for Finding 7
PAG I
QIC FILL" U17-0479
CDOT Commercial Driveway Billing Audii
CORRECT CURRENT BILLING ERRORS
waivers to permitholders who arc eligible for a waiver but not currently receiving it
PREVEN I FUTURE BILLING ERRORS
eligibility requirements on its website and/or permit application
5. "REMOVED" DRIVEWAY ERRORS
Identify all driveways with a "Removed" driveway status and obtain evidence that the public way (eg , curb, parkway, and sidewalk) was restored.
Develop and implement procedures to ensure evidence of restoration is obtained prior to changing a driveway's status to "Removed "
6. "ABLE TO INVOICE" BOX UNCHECKED
Identify all permits with the "Able to Invoice" box unchecked where the case, permit, and driveway statuses indicate they are, in fact, billable. Once these permits are identified, check the "Able to Invoice" box and bill the permitholder.
Consider removing the "Able to Invoice" box and, instead, rely upon the case, permit, and driveway statuses to determine whether to bill the permitholder If CDOT continues to use the "Able to Invoice" checkbox, the Department should define specific situations warranting an "unchecked" designation and routinely verify that those permits remain unbillable.
7. INACCURATE CBD IDENTIFICATION
Correct the records for those properties misidentified as inside or outside the CBD.
Use geospatial data to automatically determine whether a driveway location is inside or outside the CBD. If NSR/Suntrack cannot be modified to read geospatial data, or if such functionality is not included in any future system the City implements, CDOT should check addresses using other electronic sources such as the City's "Boundaries - Central Business District" Data Portal18
In consideration of the above recommendations, CDO f should review and update the current and past due amounts accordingly; credit accounts that, have been overbilled, and provide reimbursements for those that, have overpaid
""' City of Chicago, Department of Innovation and Technology, "Boundaries - Central Business District." accessed March 27, 2019, h:rps//data c tyofchicagc ora/Facihties-C.ecciraoh.c Boundaues/Bourdaues-C e n t r a i ¦ B u s i n ess - D i s t r i c '.A ks; - h vs w
-'AGE 16
CDOT Commercial Dnveway Billing Audit.
l o address the factors that: contributed to billing errors and omissions, OIG recommends that CDOT,
collaborate with DOIT to retire NSR/Suntrack and transfer functionality and data to Hansen, ensuring that all the concerns noted in this audit are addressed through preventive measures in the Hansen system and/or CDOT's related procedures;
remove or consolidate NSR/Suntrack database fields, as well as options within those fields that are redundant, rarely used, or unnecessary (See Appendix D for specific examples to consider). If CDOT and DOIT successfully transfer functionality to Hansen, they should ensure the new system does not replicate these problems;
identify and record existing driveways that have no associated NSR/Suntrack record. This may include developing an inspection strategy and/or providing public notice to all commercial property owners urging or requiring them to self-report;
document and provide to relevant employees standardized procedures for driveway permitting, billing, and monitoring, including, but not necessarily limited to, those discussed in this report. CDOT should work with DOB to standardize procedures, because DOB creates new driveway permit records in the NSR/Suntrack system;
develop monitoring tools, such as automated reports and/or notifications, to detect permits at risk for inaccurate billing or non-billing, including permits with,
o statuses indicating that ownership is in question,
o case, permit, and/or driveway statuses of "Pending,"
o missing billing addresses,
o pa rtia I ly- or fu I ly-wa ived fees,
o "Removed" driveway statuses, and
o unchecked "Able to Invoice" boxes.
MANAGEMENT RESPONSE
"CDOT agrees with OIC's recommendations that correcting driveway data and preventing errors will improve the accuracy of billing driveway permit fees CDOT thanks OIC for recognizing the resource challenges to accompjlish this task and providing prioritization guidance Although the NSR system presents a number of challenges, CDOT agrees with OIC's recommendations and will attempt data
PAGE 17
OIG I-ILL ;/iV 0479
CDOI Commercial Driveway (Billing Audit July !: ?019
corrections that the OIC specifically identified and then, prioritize the remaining data corrections based on the financial implications.
"In March 2019, the Department of Innovation and Technology (DolT) informed CDOT thai the driveway data in NSR will be migrated to Infor Public Sector (IPS—formerly known as "Hansen") The data migration offers CDOI"an opportunity to evaluate how it processes and monitors driveway data, including implementing the corrective and preventive measures described in the Chicago Department of Transportation Commercial Driveway Billing Audit. Specifically, CDOT will develop standardized policies and procedures for NSR and forthcoming IPS development, as well as review and reconcile data errors including unbilled and inaccurately billed driveway records. CDOT is collaborating with DolT on the most efficient and effective ways to address and remedy the raised issues of this audit. Due to the complexity of the driveway permit data the assessment for migration from NSR to IPS 11 and development is anticipated in the 2nd quarter of 2019 and migration to IPS 11 in the 4th Quarter of 2020."
CDOT's responses to the specific recommendations are provided in the table below.
CORRECT CURRENT BILLING ERRORS
1. PROPERTY OWNER UNKNOWN
"CDOT's Division of Infrastructure Management (DIM) will collaborate with OBM and COAL to identify the most efficient and effective use of current resources to accurately identify driveway owners and reconcile current permit status. During 2019 CDOT will,
Assess current workflow processes,
Develop a standard operating procedure and methodology to review and correct property owner unknown driveway permit records,
Request DolT to work with NSR technical support to provide driveway/ reports detailing the estimated 5,880 property owner unknown permit
ca t egories,
Prioritize research and conduct field inspections to resolve unknown, disputed, suspended, or transferred
PREVENT FUTURE BILLING ERRORS
"CDOTproposes two phased solutions to prevent future property owner unknown driveway billing errors. During Phase 1, CDOT staff will,
Assess current workflows,
Develop standard operating procedures;
Provide new training to staff on preventing property owner unknown driveway permit billing errors;
Request DolT to work with NSR technical support to provide quality control driveway/ reports detailing property/ owner unknown permit categories,
This effort will include researching current property owners thnpugh Cook County property tax assessment records, opening new owner permits prior to closing existing
CDOI" Commercial Driveway Billing Audit
CORRECT CURRENT BILLING ERRORS
property ownership and address driveway permits using techniques and guidance from OBM and COAL;
• Identify resources and time required to correct current NSR data
Additionally CDOT will dedicate resources to review, research and reconcile driveway permit data. This effort includes correcting the estimated 5,880 'property owner unknown'permit categories identified by the OIG in this Audit Report Depending on available resources and the challenges presented by NSR, it may take additional CDOT staff a year or more to research and correct the current driveway records in NSR."
PREVENT EUTURL BILLING ERRORS
permits and field inspections to verify driveway removals arid restorations
During Phase 2, CDOT will collaborate with DolT during IPS 77 development to reengineer system and workflow processes including automatically controlling for data errors such as requiring property owner information, closing an existing permit prior to opening a new owner permit, creating field inspection cases to verify new driveways or driveway removal/restorations, and quality control reports to assist in . preventing future property owner unknown billing errors. Additionally, CDOI will collaborate with OBM and COAL to identify the most efficient and effective use of current resources to accurately identify/ and maintain driveway owners."
2. PROLONGED PENDING CASE STATUS
"During 2019 CDOT will collaborate with OBM and COAL to identify the most efficient and effective use of current resources to accurately reconcile the driveway pending case permits of longer than 1 year. As part of this effort CDOT will,
Assess current workflow processes;
Develop a standard operating procedure and methodology to review and correct prolonged pending driveway permit records;
Request DolT with NSR technical support to provide driveway reports with pending case status categories,
Identify resources and time required to correct current NSR data.
Additionally/, CDOT will dedicate resources to research and reconcile prolonged pending driveway permit statuses including field inspections to verify new driveways and
"CDOTproposes a two phased solution to prevent future prolonged pending driveway status errors. During Phase 1, CDOT staff will,
Assess current workflows,
Develop standard operating procedures,
Provide new training to staff on how to prevent prolonged pending driveway/ permit statuses
This effort will include weekly scheduled quality control reports of existing pending status and verifications through field inspections
During Phase 2, CDO f will collaborate with DolT on IPS 11 development to reengineer system processes to automatically control data errors including limit the duration of pending permit statuses, create field
PACjfc i'.-J
!- 1M7-0479 DOT Cur ni nei'a.il Drivwdy BiMsncj Audit
CORRECT CURRENT BILLING ERRORS PREVENT FUTURE BILLING ERRORS
driveway removals/restorations This effort includes correcting the S06 pending permits identified by the OIG in this Audit Report Depending on available resources and the challenges presented by NSR, it may take additional CDOT staff a year or more to research and correct tlic current driveway records in NSR "
inspection verification cases, and quality control reports to assist in preventing future prolonged pending permit status "
3. MISSING BILLING ADDRESS "During 2019, CDOT staff will,
Assess current workflow processes;
Develop a standard operating procedure and methodology to review and correct records with a missing billing address;
Provide new training to staff on how to resolve inaccurate billing address issues;
Request DolT work with NSR technical support to provide driveway reports including detailing records with missing and/or inaccurate billing addresses,
Prioritize research and resolution of 112 missing addresses and/or 172 inaccurate billing addresses driveways permits based on the largest impact on revenue;
Collaborate with COAL for guidance and techniques to correct billing addresses.
CDOT will dedicate staff to review, research, and reconcile driveway permit data This effort will include correcting) billing addresses using City verified address databases Although the NSR system presents a number of challenges,, CDOT will seek to correct missing and/or inaccurate
"CDOTproposes two phased solution to prevent future missing and/or inaccurate billing addresses. During Phase 1 CDOT staff will,
Assess current workflow processes,
Develop standard operating procedures;
Provide new training to staff to prevent missing and/or inaccurate billing addresses;
Request DolT work with NSR technical support to require billing address completion for all new driveway permits;
Request DolT work with NSR technical support to provide quality control reports to review and correct any missing and/or inaccurate billing addresses.
During Phase 2, CDOT will collaborate with DolT on IPS 11 development to reengineer the workflow process including requiring owner and billing address completion, address verification and CBD designations through the City geo-spatial address database for all driveway permits, piovide new training to staff to resolve disputed addresses, and quality control reports to verify addresses are accurately completed
I-VU...I
OIG H!_E n 17-0G79
CDOT Commercial Driveway Billiny Audit
CORRECT CURRENT BILLING ERRORS
billing addresses that the OIG specifically identified and then, prioritize any remaining data corrections based on the financial implications "
4 WAIVER ERRORS
"During 2019, CDOT will research and correct the 117 records with inaccurate waived fee driveway permits status that OIG identified within this Audit Report. CDOT will also work with DOF to appropriately invoice these permits Additionally CDOT staff will,
Assess curren t workflow processes;
Develop standard operating procedure and methodology to review and correct records with incorrectly waived fees;
Provide new training to staff on how to process and resolve fee waiver issues;
Request DolT work with NSR technical support to provide driveway reports including detailing records with waived fee status
CDOT will dedicate staff to review, research, and reconcile driveway permit data. This effort will include correcting inaccurate fee waivers and billing driveway permit owners appropriately Depending on available resources and the challenges presented by NSR, it may take additional CDOT staff a year or more to research and correct the current driveway records in NSR "
July I
PREVENT FUTURE BILLING ERRORS
"During 2019, CDOT will request Doll' to work with NSR technical support to integiate MCC rules for fee waivers or if not possible then, require only permit supervisors to grant fee waivers including supporting documentation from property owner Additionally CDOT proposes a 2 phased solution to prevent future fee waiver billing errors. During Phase 1, CDOT staff will,
Assess current workflow processes,
Develop standard operating procedures;
Provide new training to staff on how to process and resolve fee waiver issues;
Require only permit supervisors to grant fee waivers with supporting documentation;
Request DolT work with NSR technical support to provide quality control waived fee status driveway reports
During Phase 2, CDOT will collaborate with DolT on IPS 11 development to reengineer system processes to automatically control fee waivers including incorporating MCC logic rules to grant fee waivers, requiring supervisor only access to approve the waiver, requiring supporting documentation to verify ownership, and quality control reports to assist in preventing future incorrect fee waiver permit status
In tandem with the migration of driveway data from NSR to IPS, CDOT will draft
PAGL '/
OK. FILE HU-0479
CDOT Commercial Driveway Billing Audii.
CORRECT CURRENT BILLING ERRORS PREVENT FUTURE BILL ING ERRORS
standard operating policies that instruct staff on how to process driveway data in IPS Additionally, CDOT will request DolT publish fee waiver information on the formerly Hansen/new IPS permit website "
5. "REMOVED" DRIVEWAY ERRORS
"During 2019, CDOT will review, research, verify, and correct the 81 'removed driveway' records identified byOIC within this Audit Report This effort will include field inspections and photos of driveway removal one/ full restoration of the public way Additionally, CDOT staff will,
Assess current workflow processes;
Develop a standard operating procedure and methodology to review and correct records with an erroneous removed driveway status;
Provide new training to staff on how to process and resolve removed driveway status;
Use field inspections to verify driveways were removed and full public way restoration occurred;
Request DolT work with NSR technical support to provide driveway reports including detailing records with removed driveway status.
CDOT will dedicate staff to review, research, and reconcile driveway permit data. This effort will include field inspection verifications and billing driveway permit . owners appropriately Although the NSR system presents a number of challenges, CDO f will seek to correct the 81 'removed driveway' records that the OIG specifically identified and then, prioritize any remaining data corrections based on the financial u i:plications "
"CDOTproposes a 2 phased solution to prevent future removed driveway billing errors. During Phase 1, CDOT staff will,
Assess current workflow processes,
Develop a standard operating procedure;
Provide new training to staff on how to process and resolve removed driveway billing status,
Use field inspections to verify driveways were removed and full public way restoration occurred;
Request DolT work with NSR technical support to provide driveway reports including detailing records with removed driveway status.
During Phase 2, CDOT will collaborate with DolT on IPS11 development to reengineer workflow processes to including requiring field verification and evidence of driveway removal and full public way restoration prior to a record modification and quality control reports to assist in preventing future incorrect driveway removed billing status."
page iz
C Jk.'i FUJI n'\"/-0A79
CDOT Commercial Di ivevvay LSilling Audii.
CORRECT CURRENT BILLING ERRORS
6 "ABLE TO INVOICE" BOX UNCHECKED
"During 2019, CDOT will research and correct the 60 driveway permit records that have an unchecked 'able to invoice' box identified by OIG within this Audit Report. Additionally, CDOT staff will,
Assess current workflow processes;
Develop a standard operating procedure and methodology to review and correct records where the 'able to invoice box' was unchecked,
Provide new training to staff on how to resolve records with unchecked 'able to invoice' box issues;
Request DolT work with NSR technical support to provide driveway reports including detailing records with unchecked 'able to invoice' box;
Prioritize research and resolution of records with unchecked 'able to invoice' box based on the largest impact on revenue.
CDOT will dedicate staff to review, research, and reconcile driveway permit data. Although the NSR system presents a number of challenges, CDOT will seek to correct the 60 records with unchecked 'able to invoice' box that the OIG specifically identified and then, prioritize any remaining data corrections based on the financial implications."
7. INACCURATE CBD IDENTIFICATION
'During 2019, CDOT will research and correct the 151 records for inaccurately CBD designated billed driveway permits identified by OIG within this Audit Report. This effort will include,
July 1, 2019
PREVENT FUTURE BILI ING ERRORS
"During 2019, CDOT will request Dol l work with NSR technical support to either eliminate or automatically check 'able to invoice' box for oil existing driveway permits Additionally, CDOT staff will,
Assess current workflow processes,
Develop a standard operating! procedure,
Provide new training to staff on how to resolve records with unchecked 'able to invoice' box issues,
Request DolT work with NSR technical support to provide driveway quality control reports detailing records with unchecked 'able to invoice' box or unable to invoice status.
During Phase 2, CDOT will collaborate with DolT on IPS 11 development to reengineer workflow processes to require all active driveway permits to be invoiced unless they meet specific standard operating procedure criteria or field verification with supporting documentation and quality/ control reports to assist in preventing future inability to invoice billing status "
CDOT proposes two phased solution to prevent future missing and/or inaccurate billing addresses During Phase 1 CDOT staff will,
PACE 76
OIG FILL !; 17-0479
CDOi Commercial Driveway Billing Audit
CORRECT CURRENT BILLING ERRORS PREVENT FUTURE BILLING ERRORS
Assess current workflow processes,
Develop a standard operating procedure and methodology to review and conect CBD designated billing addresses using City verified address databases and bill owners appropriately/,
Provide new training to staff on how to resolve inaccurate CBD designated billing address issues;
Request DolT work with NSR technical support to provide driveway reports including detailing records with CBD designated billing addresses.
CDOT will dedicate staff to review, research, and correct CBD designated addresses for driveway permits. Although the NSR system presents a number of challenges, CDOT will seek to correct the 151 inaccurately CBD designated driveway addresses that the OIG specifically/ identified using City geo-coded address and boundary databases records and then, prioritize any remaining data corrections based on the financial implications."
Assess current workflow processes,
Develop a standard operant ic/,
Provide new training to staff to prevent missing and/or inaccurate billing addresses; >
Request DolT work with NSR technical support to require billing address completion for all new driveway permits and correctly locate the address within or outside the CBD;
Request DolT work with NSR technical support to provide quality control reports to review and correct any missing and/or inaccurate billing addresses
During Phase 2, CDOT will collaborate with DolT to on IPS 11 development to reengineer the workflow process including requiring owner and billing address completion, CBD address verification through the City geo-coded address and boundary databases for all driveway permits, provide new training to staff to resolve disputed addresses, and quality control reports to verify/ addresses are accurately completed."
"Although the NSR system presents o number of challenges, CDOT will seek to correct the 172 inaccurately billed and the 6,541 unbilled records identified by OIC within this Audit Report and then, prioritize any remaining data corrections based on the financial implications. Additionally, after CDOT corrects and resolves driveway permit data errors as noted in above corrective actions, it will work with DOF to invoice permit accounts appropriately [... and] credit permit accounts appropriately.
"The NSR to IPS 11 data miigration offers CDOT an opportunity to evaluate how it processes and monitors driveway data, including implementing the corrective and preventive measures identified by OIC in this Audit Report. Specifically, CDOT is collaborating with DolT on the most efficient and effective ways to address, remedy, and prevent the causes of unbilled and inaccurately billed driveways identified by OIC in this Audit Report. Due to the complexity of the driveway permit data, assessment for migration from NSR to IPS 11 and development is anticipated in the
PAGE 24
CI)(.) I" Commercial Di ivevvay Fiillmg Audi! July i, 7019
2nd quarter of 2019, afterwards migration to IPS 11 is anticipated to occur in the 4 th Quarter of 2020.
"CDOT is collaborating vv/th DolT on IPS 11 development including re-engineering workflows that will address, remedy, and prevent the causes of unbilled and inaccurately billed driveways identified by OIC in this Audit Report Due to the complexity of the driveway permit data, assessment for migration from NSR to IPS 11 and development is anticipated in the 2nd quarter of 2019. Migration to IPS 11 is anticipated to occur in the 4th Quarter of2020.
"IPS 11 includes a mobile application that public right of way inspectors will use to conduct permit based and ad hoc inspections. The application-features a map that after data migration will display all the permits (opening permits, dumpster permits, occupy permits, etc.) within a selected radius. The inspector can then visually identify which items to target for inspection. If an inspector observes a driveway that is not permitted, they can issue a citation to the driveway owner. The owner would then need to apply for a driveway permit, thus allowing CDOT to record the driveway in IPS.
"CDOT will draft standard operating procedures to control driveway data processing in NSR (Phase 1) and IPS (Phase 2). Regarding DOB, CDOT will work with DOB to determine the best way to streamline and improve processes and procedures.
"As described in previous answers, CDOT intends to work with DolT to eliminate the causes of unbilled and inaccurately billed driveways described in OIC's audit. If NSR cannot be modified to eliminate the causes, then CDOT will work with DolT to schedule regular reports of driveways that are in an unbilled status fPhase 1). If IPS cannot eliminate the causes, then CDOT will work with DolT to determine what reports and alerts are available to notify CDOT staff that a driveway is at risk of becoming unbilled.-CDOT's standard operating procedures will include guidance for staff on how to resolve driveways in an unbilled status (Phase 2)."
PACE 25
While CDOT annually bills permitholders for past-due driveway permit fees, it does not actively pursue payment. Furthermore, the City does not include driveway permit fees in its standardized debt collection processes related to commercial property. Two common processes are the Bulk Sales Notice, which requires the seller or buyer of tax- or license-related businesses or activities to notify the City of the sale so that the City can ensure any related debt is paid,19 and the Full Payment Certificate required of all real estate transfers to show that any City utility charges and penalties related to the property are paid in full prior to transfer.^0
DOF told OIC that, on an ad hoc basis approximately every 12 to 18 months, it works with CDOT to identify delinquent driveway permitholders and place a hold on their business licenses. Nonetheless, there were at least 11,561 active permits with $3.8 million of past due driveway permit fees in CDOT's records. The actual past due amount could be higher if inactive permits are also considered.
As mentioned in Finding 1, CDOT stated that it had previously considered attaching driveway permits to the permitholder's deed, water bill, driver's license, or business license, but that these ideas had not "gained traction." DOF stated it does not include driveway permit fees in standardized collection processes because it "had issues in the past with bad data/ownership information in NSR/Suntrack." This has created a self-perpetuating cycle; the errors in CDOT's ownership records prevent the Department from using existing City processes to correct its ownership records.
RECOMMENDATIONS
CDOT should develop procedures to collect past due driveway permit fees and include such fees in the City's standardized debt collection and verification processes. Such processes may include the City's Bulk Sales and Full Payment Certificate processes. Another option would be to add annual driveway permit fees to the City's utility bill, because driveway and water/sewer fees are both tied to real property
'¦¦' Learn more about Bulk Sales at
erros /Av-.vvv ch.cago aov/city/ori/depts/!'in/niovdrtVta>:_ciivisif jn/svcs/fi;e_a_:::uik. salosnouce html Learn more about Full Payment Certificates at
OIG FILE ;;T7-0CDOT Commercial Driveway Billing Audit July 1, 2019
To ensure the most efficient and effective corrective action, CDOT should collaborate with DOF, DOL, and other departments as necessary, recognizing that effective debt collection relies upon accurate data (as addressed in OIC's recommendations for Finding 1)
MANAGEMENT RESPONSE
"CDOT will collaborate with DOF, DOL, and other departments as necessary to determine the most effective method for ensuring past due driveway permit fees are collected."
PACE 27
OIC FILL ;M7-0'V79
CDOT Commercial Driveway Billing Audit
IV. OBJECTIVE, SCOPE, AND METHODOLOGY A. OBJECTIVE
The objective of the audit was to determine if CDOT accurately billed all annual commercial driveway permit fees.
SCOPE
The audit focused on annual fees for commercial driveway permits in existence as of April 13, 2018. Except for a small number of misclassified permits, the audit did not include residential driveway permits because they require only a one-time, $10 fee. We did not attempt to identify existing commercial driveways that are not recorded in CDOT's NSR/Suntrack system.
C. METHODOLOGY
To assess whether CDOT accurately billed permitholders, OIG analyzed a data set provided by CDOT of commercial driveway permits as of April 13, 2018.21 This data set comprised 28,357 permits containing 54,099 driveways, and each permit was assigned 1 of 23 case statuses. OIG obtained definitions of each case status and grouped the various statuses into categories based on shared characteristics. The five OIG-defined categories are depicted in Figure 5.22
FIGURE 5: NUMBER OF PERMITS PER OIG-DEFINED CATEGORY
CLOSED/REMOVED 619
\ OTHER CASE STATUS V 1/i45
PENDING 515
Source OIG categorization of driveway permit data provided by CDOT
:'' OIG cleteri rxned that the data provided by CDOT was sufficiently reliable to achieve our' testing objectives Our determination of reliability was based on our comparison of CDC I provided data to source data within the NSR/Suntrack system
;:' Appendix C provides the 23 case statuses that make up the 5 categories
PAG b28
OIC l-'!LL ;M7 0479
CDOT Cornrnercial Driveway Billing Audn.
I o establish whether CDOT accurately billed permits in the "Completed" category, OIG calculated the expected fee amount per the MCC using the permit addr esses and driveway width recorded in the NSR/Suntrack system. We then compared the calculated fee amount to CDOT's fee amount recorded in NSR/Suntrack. If the two amounts were the same, we determined the permit had a low risk of inaccuracy and we did not review further. However, if there was a difference, OIG reviewed the data and comments in NSR/Suntrack and discussed the discrepancies with CDOT.
To determine whether "Transferred" driveways were actually transferred to an active permit, OIG searched for all "Transferred" driveway addresses among "Completed" permits. We selected a random sample of 95 addresses with a "Transferred" driveway status but no active permit and used Google Street View to determine if the driveway existed. The same methodology was used for "Pending" driveways over one year old, using a random sample of 76 permits.
In addition to the analysis described above, OIG reviewed available process documentation and interviewed CDOT staff. We also performed ad hoc research using the NSR/Suntrack system and used Google Street View to validate the existence of driveways.
STANDARDS
We conducted this audit in accordance with generally accepted Government Auditing Standards issued by the Comptroller General of the United States. Those standards require that we plan and perform the audit to obtain sufficient, appropriate evidence to provide a reasonable basis for our findings and conclusions based on our audit objectives. We believe that the evidence obtained provides a reasonable basis for our findings and conclusions based on our audit objectives.
AUTHORITY AND ROLE
The authority to perform this audit is established in the City of Chicago Municipal Code § 2-56-030 which states that OIG has the power and duty to review the programs of City government in order to identify any inefficiencies, waste, and potential for misconduct, and to promote economy, efficiency, effectiveness, and . integrity in the administration of City programs and operations
The role of OIG is to review City operations and make recommendations for improvement.
City management is responsible for establishing and maintaining processes to ensure that City programs operate economically, efficiently, effectively, and with integrity.
•'AG I.' 79
OIG FILL //17-0479
CDOI Commercial Di ivevvay Billing Audit July 1,2019
APPENDIX A: CENTRAL BUSINESS DISTRICT (CBD)
BOUNDARIES
Starting in 2002, the fees for commercial driveways inside the CBD doubled Figure 6 depicts the CBD boundaries.
FIGURE 6" BOUNDARIES OF THE CENTRAL BUSINESS DISTRICT
Division St.
Roosevelt Rd.
Source MCC § 9 4-010; https Aciata cityofchicago orq/i-aciliM's Ceociraphic-EiouPdanes/Boundanes-Central-Bus mess - D i st r i c 1A ks i - n vs vv/d a ta
OIG l-ILL .*/17-0479
CDOI Commercial Driveway Billing Audit July I, 701')
APPENDIX B: PROCESS FLOW FOR STAGNANT PERMITS
WITH UNRESOLVED PROPERTY OWNERSHIP
Figure 7 depicts the process, as described by CDOT, for resolving property ownership questions (see Finding 1). Note that whether the recipient of the bill pays or not, CDOT continues to bill annually for both current and past clue permit fees This is discussed in Finding 2.
FIGURE 7: AN ESTIMATED 5,880 PERMITS REMAINED STAGNANT AND UNBILLED DUE TO UNRESOLVED PROPERTY OWNERSHIP
NSR/SUNTRACK SYSTEM
CDOT UPDATES STATUS CDOT UPDATES STATUS CDOT UPDATES STATUS
TO SUSPENSE TO DISPUTE TO CLOSED-TRANSFER
YES
AAA
Source OIG depiction of CDOT process
OIG i- ILL !i 17-0470
CDOr Go; nmercial Di iveway Billing Audi:. July I, 7019
APPENDIX C: PERMITS BY CASE-STATUS AND OIG-
DEFINED CATEGORY
The commercial driveway permit data provided by CDOT contained 28,357 permit records with 23 different case statuses For testing purposes, OIG categorized permits with similar case statuses into five different categories. Figure 8 summarizes the number of permits and driveways per case status and identifies the assigned OIG-definecl category.
FIGURE 8: PERMITS BY CASE STATUS AND OIG-DEFINED CATEGORY
/v-, \ ••• »^G. ¦ ¦¦:<: ! L-. v."-'., ;.;.G:i:-r~"^5 ^ ^ercenti
COMPLETED Completed - Driveway Permit Issued 14,895 52 5% 29,019 53 6%
Completed - Project/Driveway Permit Issued 43 0 2% 77 0 1%
Completed - Driveway Permit Issued - Prior Fees Owed 20 0 1% 36 0 1%
TRANSFER Closed - Transfer to new Owner 5,789 20 4% 12.088 22 3%
Suspense - Returned Mail/Ownership Search 3,466 12 2% 5,669 10.5%
Disputed - 3y Owner/Inspection Required 52 0 2% 91 0 2%
Disputed - Property Transferred 1,513 5 3% 2,544 4 7%
PENDING Pending - City Agency Reviews 481 1 7% 889 1 6%
Pending - Inspection Report 32 0 1% 47 0 ].%
Pending - Inspections Review|99|0 0%|99|0.0%
CLOSED/ REMOVED Closed - Driveways Removed 618 2.2% 962 1.8%
Closed - Driveway Removed|99|0 0%|99|0 0%
OTHER t Closed 388 1 4% 799 1 5%
HOLD 297 1 0% 54 4 1.0%
Closed - Duplicate or entered in Error \ 284 1 0% 467 0 9%
Open 168 U o /u 274 0 5%
Application Mailed to New Owner 151 0 5% 300 0 6%
Closed - Applicant Request 54 0 2% 109 0 2%
Closed - Driveway NOT Constructed 41 0 1% 62 0 1%
Closed - Rejected 38 0 1% 65 0 1%
Expired 12 0 0% 19 0 0%
Application Expired|99|0 0% 1 1 0 0%
Application Delivered by Inspector 5 i 0 0% 14 0 0'*
TOTAL 20,357 j 100 0% 54,099 100 0%
Source CDOT-providecl data from the NSR/Suntrack system
PAGL S2
OIG F:l F ;¦! l7-0'-'.V9
CDOI Commc'iaa! Driveway Billing Audit
APPENDIX D: OPPORTUNITIES TO SIMPLIFY PERMIT
DESIGNATIONS IN NSR/SUNTRACK
During the audit, OIG became familiar with driveway permit data in the NSR/Suntrack system. That familiarity, along with the CDOT-provided definitions of the various designations, allowed us to identify redundant, rarely used, and unnecessary designations. We provide the following for CDOT's consideration should it continue to use NSR/Suntrack.
Case status "Closed - Driveway removed" (singular) is redundant to the case status "Closed - Driveways removed" (plural).
Case statuses "Application Expired" and "Closed - Driveway NOT Constructed" are redundant because both are defined by the fact that the "proposed dnveway(s) was not installed within one year from the [issuance date] of the permit."
The case status "HOLD" is defined as, "The permit is placed on hold pending city review(s)," which appears redundant to the case status, "Pending - City Agency Reviews."
Case statuses "Completed - Driveway Permit Issued - Prior Fees Owed" and "Completed - Project/Driveway Permit Issued" are not defined and rarely used (63 permits). It also appears redundant to "Completed - Driveway Permit Issued" (14,995 permits).
The case status of "Open" has a seemingly contradictory permit status of "Inactive" and is undefined by CDOT.
Case status "Application Delivered by Inspector" does not intuitively reflect its definition of "Invalid Permit (Possible change of ownership)".
-7\OE
OIC FILE ii 17-0479
CDOT Commercial Driveway Billing Audit. July 1, 2019
APPENDIX E: PERMIT SCREENSHOTS WITH
NSR/SUNTRACK DATA FIELDS
Figures 9 and 10 are screenshots of NSR/Suntrack showing the location of certain variables used in the audit.
FIGURE 9. NSR SCREEN
CSECASE SOnTRACK.- NSR - City of Chicago - M. DEUN- CO0TB0I Commercial Driveways'^?:
¦f_f pvsi
Case Permit BttlinQ ¦
CASE STATUS ,
£_>.:';^',',Cas.e Type
' ' [Completed - Drhrew;
/^fap^CSse uoseq fitter 1 Pay ;,,
IsFsiaiiraDate
;fg)
.Name I
cdct BOtcoromerc
Case*/ Case Manager T ________
PafcrtCaseff l"™^"^^!;^M^Icl^Fon^^1?" (Transfer) [jM] rw:frorn
' E^mption: \p**"nu?fefM ;^:1dScs on We: | ... fig V Ref. To
. •. NLocalion L „ --- J.f .^^Il.i.„.VVa-fdfe3
FIGURE10: NSR SCREEN
CSECPRMT SunTRACK- NSR ¦ City of Chicago • M. DELIN • CDOT 901 Commercial Diiveways -
Permit • . • v';^^?--^'--:
^¦ ¦ i—-- - —-TV- . - ¦•• csv] . ,... —rfclrwpjcer
Unit raJFjf Una Sutirrwry jy ,Triri^iqf&,;|
jnr~nr ^
j ji@aijs l8,ij ~
• Drh/ev-ay.Wttan
IvP; f f
Status i; iDctails '•
120.00 l£r
'Fee l:
Wc,^ [DEC 31. 1996
Slart' 'Stop C
PACE 34
MISSION
The City of Chicago Office of Inspector General (OIG) is an independent, nonpartisan oversight agency whose mission is to promote economy, efficiency, effectiveness, and integrity in the administration of programs and operations of City government. OIG achieves this mission through,
administrative and criminal investigations by its Investigations Section,
performance audits of City programs and operations by its Audit and Program Review Section;
inspections, evaluations and reviews of City police and police accountability programs, operations, and policies by its Public Safety Section; and
compliance audit and monitoring of City hiring and employment activities by its Hiring Oversight Unit.
From these activities, OIG issues reports of findings and disciplinary and other recommendations,
to assure that City officials, employees, and vendors are held accountable for violations of laws and policies;
to improve the efficiency and cost-effectiveness of government operations; and
to prevent, detect, identify, expose, and eliminate waste, inefficiency misconduct, fraud, corruption, and abuse of public authority and resources.
AUTHORITY
OIG's authority to produce reports of its findings and recommendations is established in the City of Chicago Municipal Code §§ 2-56-030(d), -035(c), -110, -230, and 240.
Cover images courtesy of Zachary McNealy
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