A long-awaited city audit of the Denver Zoo landed Thursday without major demerits but renewed questions about the use of recycled water in animal exhibits.
The audit was the first undertaken by the city since the Denver Zoological Foundation took the reins of the City Park installation six decades ago. And it came after months of resistance by zoo officials to the city auditor’s office — until Auditor Tim O’Brien publicly fired off a letter to Mayor Michael Hancock in April.
O’Brien said Thursday that Denver Zoo officials eventually cooperated fully with the audit, which was allowed explicitly by the zoo’s most recent 25-year cooperative agreement with Denver Parks and Recreation.
Zoo president and CEO Shannon Block and Denver Parks and Recreation executive director Allegra “Happy” Haynes agreed to implement all eight recommendations in the audit. Most focused on ways to strengthen the zoo’s board governance and a failure by city and zoo officials to fully comply with some contract provisions.
Auditors also dove into two recent controversies, though they didn’t report any red flags.
Zoo officials in September 2015 aborted an ambitious project to build an innovative “waste-to-energy” biomass gasification system that would have turned trash and animal dung into electricity. They couldn’t get the system to work after spending more than $3.5 million, by auditors’ estimate, and eventually took a $1.7 million write-off on its accounting records.
“Based on the results of audit work covering contributions, grants, endowments, split-interest agreements, and the impairment of the waste-to-energy plant, it appears that the Foundation’s accounting practices are compliant” with generally accepted principles, the audit says.
The audit is less forthright on the zoo’s use of recycled water that’s been treated for some of its operations, including irrigation, exhibit cleaning, heating and cooling systems, and exhibit pools.
In 2015, the zoo stopped providing recycled water for drinking to animals in the Toyota Elephant Passage because the U.S. Department of Agriculture doesn’t have standards beyond recommending potable water.
The audit notes the unclear standards for recycled water and cites a need for more research on animal safety for other uses of that source of water that might affect animals. The auditors urge the zoo to look into the issue more.
One of the audit’s findings says the city and the zoo fail to swap required annual payments to cover certain costs of zoo operation. The city is supposed to pay for utilities, and the zoo must reimburse the city for a declining number of city employees who work at the zoo, now 26.
But the audit found the zoo made only partial reimbursements for those workers and had taken over utility payments, an informal arrangement that resulted in skewed annual projections for a city special revenue fund.
The zoo also hasn’t always submitted its annual budget to the city before the foundation board approves it.
“The purpose of the audit is to improve service delivery and ensure that this community asset remains healthy for generations to come,” O’Brien said in a news release.
