Audit Report On The Issuance And Processing Of Notices Of Violation By The Department Of Buildings

Audit Report on the Issuance and Processing of Notices of Violation by the Department of Buildings

October 28, 2013

AUDIT REPORT IN BRIEF

Download the Complete Report (pdf 736 KB)

This audit determined whether the Department of Buildings (DOB): (1) has adequate controls in place to ensure that Notices of Violations (NOVs) are properly processed and (2) has made adequate efforts to reduce the number of NOV dismissals based on deficiencies in its issuance process.

DOB is responsible for the safe and lawful use of more than 975,000 buildings and properties throughout the five boroughs by enforcing the City’s Building Code, Electrical Code, Zoning Resolution, New York State Multiple Dwelling Law, and other laws applicable to the construction and alteration of buildings.  DOB conducts inspections in response to complaints and requests for inspections that come from the public, community boards, or City agencies. If it is determined upon inspection that a property does not comply with applicable laws, the inspector issues an NOV, citing the reasons for the violation.

An NOV can be primarily issued by directly serving the respondent with the NOV or by posting it in a conspicuous and visible location. Documents associated with the NOVs that have been issued and served are required to be reviewed by the unit supervisor and then forwarded to DOB’s Administrative Enforcement Unit (AEU) for processing and entry into the Environmental Control Board’s (ECB’s) computer system, the Automated Information Management System (AIMS).

During Fiscal Years 2011 and 2012, ECB reported $87 million and $106 million, respectively, in revenue received from the issuance of fines, of which more than $25 million (29 percent) and $34 million (32 percent) was attributed to fines issued by DOB.

Audit Findings and Conclusions

This audit concluded that DOB has adequate controls over the processing of NOVs. However, its recordkeeping needs to be improved. Currently, DOB has no procedures to annually reconcile issued NOVs and compare them to voided NOVs, thereby hindering its ability to account for all NOVs.  This has led to inadequate and inconsistent record keeping, as key steps in the tracking of NOVs are not documented and are left to the discretion of the various units and inspectors.  As a result, DOB is unable to ensure that all NOVs are accounted for.

Regarding its efforts to reduce the number of NOV dismissals based on deficiencies in its issuance process, DOB has implemented a number of controls, which our tests revealed are operational and utilized on an ongoing basis. 

However, we were unable to assess the degree to which these controls were effective in reducing dismissals based on issuance deficiencies. This was due to the fact that there was not a significant decrease in the number of dismissals. Even in those instances where there was a reduction there may have been other variables that contributed to the reduction. As such, although we have noted that DOB has made efforts to reduce the number of NOV dismissals based on deficiencies in its issuance process, we cannot render an opinion as to the adequacy of those efforts.  

In addition, DOB does not enforce its policy pertaining to supervisory inspection reviews, which is an integral part of internal controls whereby management can ensure that goals and objectives are achieved and that personnel understand their responsibilities and obtain feedback about their performance.  In addition, DOB does not have adequate oversight to ensure that voided NOVs are reviewed by supervisors to ensure that correct determinations were made when voiding the NOV.  

Audit Recommendations

To address these weaknesses, we make four recommendations, including that DOB should:

• Require that supervisors perform a periodic reconciliation of NOVs to ensure that all NOVs, those that have been issued, as well as those that remain unissued, are accounted for.
• Ensure that the supervisors conduct the required number of Training Inspections and Quality Assurance Review Inspections in accordance with its guidelines.
• Modify its procedures to require supervisors to sign the voided NOVs as an indication they have been reviewed and to require supervisors to perform spot checks of voided NOVs to ensure that replacements are issued, when warranted.

Agency Response

DOB officials generally agreed with all four of the audit’s recommendations, but stated  that they are already in compliance with two of them (requiring that inspectors issue NOVs in sequential order and ensuring that supervisors conduct the required QA inspections).  Because we did not find that DOB was in compliance during the period covered by our audit tests, we stand by our audit findings.