Oakland City Auditor Courtney Ruby released a performance audit of the Fox Theater renovation today that shows the city's project to turn the site into a world-class location expanded from $33 million to $91 million - a 172 percent increase.

In 1996, Oakland's redevelopment agency purchased the historic Fox Theater to begin revamping the  structure into a performing arts center and home of the Oakland School for the Arts.

But, according to Ruby, a series of financial missteps led to the sharp spike in redevelopment costs, including insufficient legislative oversight and poor contract administration.

As a result, the Oakland redevelopment agency's contribution to the project increased 300 percent from approximately $13 million to $52 million.

Ultimately there was a leadership vacuum that ended up costing Oakland tax payers, Ruby said.

"No one's looking at the big, comprehensive financial picture so at the end of the day, no one is accountable to Oakland residents," she said.

Ruby said that the project also failed to conduct a comprehensive financial feasibility study, an important component in tracking redevelopment costs.

Specifically, the audit shows that there was weak contract oversight and administration. For example, according to the audit, there were $2.1 million in change orders that were paid with inadequate review.

Also, according to the audit, the project management structure was poor, resulting in both the project manager, and contractor Turner Construction, benefiting from financial cost increases as the project grew in scope. Ruby said that $1.2 million was paid to the project manager, California Capital Group, that exceeded the "not-to-exceed" contract limits.

The audit also shows that as the project grew in scope and cost, the Oakland City Council was not provided with a number of important options including whether or not modifications were ultimately necessary.

"It's critical from a City Council perspective to know if they are approving something required or something that's an add-on, an option," Ruby said.

Another misstep is connected with competitive bidding and increasing local business participation.

More than $22 million in construction contracts was awarded to local or small local businesses without any competitive bidding process. Yet the audit found that the waiver did not help with the goal to increase local participation in redevelopment.

But city officials, in a written response, mostly disagreed with the audits findings and said that the redevelopment of the Fox Theater is a proud moment for Oakland.

"The Fox Theater is an achievement not merely for the rehabilitation of an historic structure, but also because it is the linchpin in the Oakland Uptown area's economic revitalization," City Administrator Deanna Santana wrote.

According to Santana, the Fox Theater redevelopment was always envisioned as a full renovation project and costs were in line with Council information and approval. No costs associated with the development were directly taking from city funds and new potential funding sources were found for the project increases, she wrote.

The Fox Theater is the largest redevelopment project the city has undertaken. In 2004, the City Council approved a "Basic Renovation" for the Fox Theater, but in 2006, the project evolved after $34 million in additional funding was identified, included a number of major upgrades. Ultimately, the Fox opened with great fanfare in 2009.

Given the upcoming redevelopment of the Oakland Army Base, Ruby said Oakland can learn a number of lessons from the Fox experience. Ruby said for the Army Base development she's seeing City Council implement a number of positive steps including the appointment of an independent project manager.