The Audit Committee’s final report on the city’s financial situation, delivered and presented to the City Council on Aug. 8, found that the city of San Diego’s dire financial straits were caused by years of “reckless” mismanagement from a number of past and present city and pension board officials.

Among the elected officials named in the report from risk-management firm Kroll, Inc. are former Mayor Dick Murphy, Council President Scott Peters and Councilmembers Toni Atkins, Donna Frye, Brian Maienschein and Jim Madaffer. Murphy and the five council members were found to have violated pension and sewage laws, as well as improperly handling financial statements and bond disclosures having to do with both the pension fund and wastewater treatment.

Mishandling of the pension fund occurred primarily through the approval of Manager’s Proposals I and II, the report says. Manager’s Proposal I violated state and local law by enabling the city to reduce contributions to the fund, which contributed to weakening its stability, and Manager’s Proposal II “was unlawful for a number of reasons” and didn’t offer tangible benefits for city retirees.

With regard to the sewage system, the report states the city allowed homeowners in the city of San Diego to be overcharged on their monthly water bills, with the overcharge used to “subsidize the City’s industrialized water users.” It says the city “knowingly failed to comply with federal and state requirements” put in place to protect consumers from such situations. Former Councilmember Ralph Inzunza is also implicated in this portion of the report.

While the report details illegal and wrongful conduct from numerous officials, it does not accuse any of intentional wrongdoing, at most calling their conduct negligent.

However, City Attorney Mike Aguirre called the Kroll report “essentially a political payoff” to council members because it cleared them of allegations of securities fraud.

“What essentially has occurred here is that San Diego taxpayers have been bilked out of $20 million by big-league East Coast operators,” said Aguirre in a press release. “To recommend the payment of illegal benefits is preposterous. In October a jury will decide on whether these pension benefits must be paid by the city. Meanwhile, we are expecting that the U.S. Securities and Exchange Commission (SEC) will determine whether the acts of elected City officials were negligent, reckless or committed with willful intent.”