Austin reviewing its party spending for the first time in years after KXAN investigation

Investigations

Investigative Summary:

KXAN first investigated Austin’s holiday party spending last year, finding the city’s party payments outpaced larger Texas cities and Austin lacked clear policy guidelines. Despite concerns raised by one council member, some departments increased party spending year over year. Now, the city is reviewing its awards and recognition program.

AUSTIN (KXAN) — Austin’s Development Services Department paid for a DJ and a photo booth as part of a holiday party for its employees in December.

The party was similar to the one it held the previous year, at a cost more than $15,000 for food, entertainment and gifts for employees.

Development Services rented a photo booth as part of a holiday party in December 2019 (KXAN File Photo)
Development Services rented a photo booth as part of a holiday party in December 2019 (KXAN File Photo).

Development Services was one of three city departments to spend over $15,000 on holiday parties and events in December 2018.

A KXAN review of city spending on holiday parties has found Development Services shelled out more in December 2019, with a price tag of $16,499.

Development Services Director Denise Lucas defended the spending, saying the department follows the city practice of allowing up to $65 per full-time employee for these types of parties.

Lucas told us in part, “We believe it is important to recognize the hard work of those 475 full-time and temporary employees, who help support our vibrant community and protect public safety by ensuring responsible development.”

Public Works spent the most of any department, paying out $18,495 on parties and events for its nearly 600 employees in December 2019. That included $10,453 on a holiday event for its Streets and Bridges Division, according to records obtained by KXAN.

Public Works Director Richard Mendoza also said his department follows the $65-per-person practice.

In an email from the department, Mendoza said, “We take very seriously the trust that the public places in us to provide quality services, and in turn make sure that we are spending public dollars effectively and appropriately. As such, we stand by our practice of recognizing and appreciating the hard work of our public servants.” 

While both department directors mentioned a city practice of $65 per full-time employee over the entire course of a year, KXAN previously reported the policy isn’t clear.

A city spokesperson told us last year there is no formal documentation that dictates a specific dollar amount for parties.

Austin's Public Works Department spent the most on holiday parties and events for employees in December 2019. Other departments with more employees, like Austin Energy, spent less. The money comes out of departments' annual Awards and Recognition budgets. The policy on this spending is being reviewed by the City Manager's Office.
Austin’s Public Works Department spent the most on holiday parties and events for employees in December 2019. Other departments with more employees, like Austin Energy, spent less. The money comes out of departments’ annual Awards and Recognition budgets. The policy on this spending is being reviewed by the City Manager’s Office.

He did reference a “$65 per full time employee” rule for awards and recognition spending that may have gone into effect in the late 2000s, but he couldn’t “reliably confirm it ever existed.”

City Council member Leslie Pool, who represents District 7, tasked City Manager Spencer Cronk with reviewing the spending policies after KXAN’s investigation.

“I share your concerns,” she said earlier this month. “I asked Susie [Pool’s assistant] to check in with the city manager’s office to get an answer for you, and as soon as we have that we’ll be happy to pass that along to you.”

Last year, Pool said she found the spending by some departments “unacceptable.”

Holiday party spending up across the board

According to receipts KXAN received, 32 Austin departments spent $156,248.99 on holiday parties in December 2019.

That’s up from a year earlier, when 34 city departments spent $140,532.97.

Carol Guthrie is head of the local union for city, county and state workers. We showed her the latest spending totals.

“I thought we were going to see some changes to how people were going to dole out this money, and I don’t think that has occurred,” she said.

The increase comes not only after Pool’s call for a review, but our reporting that Austin departments spent more money on holiday parties than those in Dallas and Houston combined.

For perspective, the city of Dallas employs 13,208 people, which is comparable to Austin’s 13,500 employees. Houston has about 22,000 employees.

City-by-city comparison of holiday party spending in 2018.
City-by-city comparison of holiday party spending in 2018.

We asked city management about this, and through a spokesperson, City Manager Spencer Cronk provided this statement:

We do not have enough information on the other cities’ respective programs to appropriately weigh in — we would want to look at more than just the budgeted amounts, but also factor into consideration actual spending levels and evaluate the respective program distinctions. We strive to be a preferred employer in the State of Texas and are proud of the benefits we are able to offer our workforce.”

Austin City Manager Spencer Cronk

Meanwhile, Austin Mayor Steve Adler indicated that monitoring city spending on holiday parties hasn’t been a top priority.

“I think it’s important,” Adler said. “I’m focused on the homelessness issue and mobility issues, so that particular one hasn’t risen to the top of my desk yet.”  

Review underway

The city of Austin says its awards and recognition spending program — which budgets money for city departments to use on holiday parties and other events — has remained largely unchanged for more than a decade.

A city spokesperson says a workgroup has been created to review the entire program and recommend appropriate changes. The workgroup is in the fact-finding phase. Outcomes range from leaving the existing program as it is or overhauling it completely.

“The city’s goal in having an effective employee recognition program is to ensure we are appropriately recognizing and honoring the good work of our employees while remaining mindful that we are public stewards and are each responsible for maintaining public trust,” the city spokesman said.

KXAN’s Josh Hinkle, Ben Friberg, Eric Henrikson and Ed Zavala contributed to this story.   

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