IRVINE – The city’s review last year of more than $250 million spent developing a small portion of the Orange County Great Park lacked transparency and fairness in overseeing the consultants who worked on it, according to a report released Tuesday by the state auditor’s office.

The scathing 69-page report says the standards under which Irvine chose to conduct the review were less rigorous than industry standards that ensure independent analysis.

Also, the city didn’t follow its policies for awarding a key contract related to the review and allowed consultants to start work without final approvals, which led to excessive costs, according to the report.

“As a result, Irvine spent about $1.7 million related to the park review in a manner that compromised the review’s credibility,” the state auditor writes in the report titled, “Poor Governance of the $1.7 Million Review of the Orange County Great Park Needlessly Compromised the Review’s Credibility.”

In a response letter to the state auditor, however, Irvine officials point out that the audit shows the city didn’t violate any state laws and regulations. And some of the report’s conclusions go outside the scope of the audit goals and lack evidence, they said.

Councilwoman Christina Shea said Tuesday that auditors didn’t find any flaw with the park review itself and instead criticized the city’s policies without knowledge on how local government works.

“I think their title was very inflammatory, nothing close to the conclusions brought forward,” said Shea, who oversaw the city’s park review. “The report wasn’t as negative as it appears. A lot of it was subjective, opinion-based.”

The audit was initiated by Democratic Assemblywoman Lorena Gonzalez of San Diego in August 2015 on behalf of Gafcon, a project management firm in her district that was a Great Park contractor. The company said it was unfairly vilified in the city’s audit.

THE FIRST AUDIT

Irvine’s decade-long effort to develop the Great Park on the former U.S. Marine Corps Air Station El Toro base came under scrutiny during the 2012 election cycle, which shifted the City Council majority from Democrats to Republicans.

The newly elected council retained Hagen, Streiff, Newton & Oshiro, Accountants in 2013 to find out how money had been spent developing 88 acres of the 1,347-acre site. The city brought in law firm Aleshire & Wynder and a retired judge the following year to assist the investigation.

The council created an advisory subcommittee and appointed Shea and Councilman Jeff Lalloway to oversee the review.

The consultants reported in 2015 that a lack of a realistic, detailed budget was among the factors that doomed the Great Park project as it was originally envisioned.

The firms didn’t find any criminal activity after deposing more than 23 people and reviewing the park’s finances. But they said personal connections between former Councilman Larry Agran and some of the contractors and consultants on the project have raised the appearance of impropriety.

Agran has accused Shea and Lalloway of directing the process for political purposes, an assertion they have denied.

The city’s spending on the audit rose to more than $1.5 million from the initial cost of $240,000.

STATE AUDITOR’S FINDINGS

After nearly a year on Tuesday, the state auditor’s office released its findings, as well as the city’s response to them. Here are additional highlights:

• In selecting a consulting firm, the city increased the scores for Hagen, Streiff, Newton & Oshiro toward the end of the process. The city based a big portion of its evaluation on the bidders’ interview performance, even though the request for proposal did not list it as a criterion.

• The city structured its request for proposal so that it nearly ensured the winner would receive another contract without having to undergo a competitive bidding process. Hagen, Streiff, Newton & Oshiro received a $400,000 contract partly based on recommendations from its own initial report.

• The city should have discussed and decided the park review at open council meetings, instead of the advisory subcommittee, to ensure transparency.

“Greater transparency could have increased public confidence in the process of selecting and monitoring the consultants that conducted the review and in the results,” the report states.

Irvine officials said the report presented no evidence to demonstrate that the city’s handling of the review diminished public confidence in it. The city broadcast presentations by the consultants on TV and published documents on the website, they said.

Also, many of the report’s recommendations lack sources and supporting data why they are “best practices,” city officials said.

The city’s response letter was approved by four of the five council members with Councilwoman Beth Krom dissenting.

“The (state) auditor may not have liked the process, but there was nothing wrong about the review,” Shea said. “We did follow the proper process, and I’m pleased with our effort.”