SANDAG Board Approves Independent Examination

| March 3, 2017 | 0 Comments

Agency Revenue Forecasting Issues In Question

In a unanimous vote, the SANDAG Board of Directors directed agency staff to hire an outside party to initiate an independent examination of issues surrounding the agency’s sales tax revenue forecasts, and also approved a work plan developed by agency staff to improve data integrity and accuracy.

In recent months, SANDAG’s revenue forecasts for TransNet financial capacity estimates and Measure A have been called into question. TransNet is an existing regional half-cent sales tax for transportation. Measure A, which fell short of the two-thirds majority vote needed to pass last November, would have raised sales tax regionwide by another half cent to pay for transportation and other needs.

In voting for an independent examination, the SANDAG Board expressed a desire for an impartial third-party to ascertain the facts on who knew what when leading up to the election on Measure A. Board members indicated that they would like the examination to be conducted expeditiously.

The next step is for the Executive Committee of the SANDAG Board to discuss who should conduct the examination. Once the committee has identified potential outside parties who can conduct the examination, it will forward a recommendation to the Board.

In response to the fact that “errors” were identified in a complex computer model used to forecast taxable retail sales – a key factor used to calculate sales tax revenues – SANDAG staff developed a data accuracy and modeling work plan for the Board’s consideration. The plan was approved unanimously.

The plan has seven elements, with the end goal of fully investigating the errors, tracking down and fixing any work products that may have been affected, and putting into place best practices, policies, and safeguards to prevent future errors and keep the Board informed. Below are seven components of the work plan.

• Conduct Detailed Review
• Conduct Dependency Analysis
• Map Modeling Process Flow
• Improve Data Governance
• Review and Oversight
• Enhance Transparency
• Develop and Formalize Processes

Going forward, SANDAG staff will present ongoing progress reports to the agency Board of Directors and the TransNet Independent Taxpayer Oversight Committee to keep them and the public informed about the implementation of the data accuracy and modeling work plan.

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