City Finance Director Exits South Pasadena After 13 Months

Downs' departure is the latest for the volatile Finance Department, which now must search for its seventh interim or permanent director in less than five years.

Finance Director South Pasadena resigns position after only four months. City budget is not ready.
Video Screen Capture from South Pasadena City Council Meeting June 7, 2023 | (then) Interim Finance Director John Down and his team answering questions to City Council

Only days before the April 17 kickoff of the city’s accelerated budget process and four months since formally taking over as South Pasadena’s permanent Finance Director, John Downs has told the city he will exit the high pressure position May 2.

Acting Deputy City Manager Luis Frausto confirmed Down’s retirement plan, adding the city is “sorry to see him go” and offered him “our deepest gratitude.” The city “is actively exploring options and preparing a comprehensive plan to ensure continuity of operations within the Finance Department. We are committed to a smooth transition.”

Downs’ departure is the latest for the volatile Finance Department, which now must search for its seventh interim or permanent director in less than five years. It also comes after two other departures from the nine-member department, Deputy Finance Director Hsiulee Tran and Finance Manager Albert Trinh.

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The hemorrhaging of city personnel extends to the office of City Manager Arminé Chaparyan, where long-time Assistant to the City Manager Tamara Binns’ position remains unfilled since her sudden departure in February, and where Deputy City Manager Domenica Megerdichian this week left on maternity leave.

All tolled, 22 of the city’s 173 full-time positions are currently vacant, including nine in the police department and seven in public works. There are 25 full-time recruitments underway, most for police officers or cadets.

Downs came on as Interim Finance Director in February 2023 and “hit the ground running,” City Manager Arminé Chaparyan said at the time. He told the City Council he would focus on staff development and building institutional knowledge so that there could “succession planning.”

While it’s unsurprising to learn Downs, with a 27-year career in public and private finance, has retirement plans, South Pasadena Finance Commission Chair Peter Giulioni said its not a good time for the city to lose its finance director. Downs’ departure “will leave us in a difficult position.”

Downs’ interactions with some members of the City Council and Finance Commission have featured snippy exchanges in recent months, especially after a city contractor’s presentation projected general fund deficits as high as $3.7 million over the next five years, disputes over whether the city’s budget incorporates a “structural deficit,” the failure to record a particularly volatile recent Finance Commission meeting, the submission of incorrect information to the Finance Commission and complaints the Finance Department has been consistently out of compliance with the city’s own policies and reporting deadlines.

Downs has made “any number of improvements” since coming to the city “at a difficult time,” Giulioni said. “He picked up the mantle,” worked through last year’s “extraordinarily difficult” mid-year budget update, introduced a zero-based budgeting approach and helped the city secure millions of dollars in refunds it would not have otherwise received. He did other things, “like going back and cleaning up the residual mess that was created by previous city mangers and finance directors. He has brought us up to date.”

Budget not ready. finance director south pasadena leaves city.
Video Screen Capture from South Pasadena City Council Meeting June 7, 2023 | Councilmember and council liaison to the finance commission, Janet Braun, wanted to know why Council was being asked to address the LLMD deficit but not other fund deficits. She sought Downs’ acknowledgement that the budget doesn’t address funds for the city’s prospective purchase of Caltrans homes.

City Council Member Janet Braun, who campaigned in part on the need to bring greater stability to the Finance Department, said it is “hard to evaluate” Downs’ tenure with the city because “he walked into a mess [and] has been under a lot stress.” Having lamented the department’s financial reporting practices, Braun recently had a “good meeting” with Chaparyan and Downs, who “did put together a spreadsheet to deliver financial statements finally,” and did apologize for providing some incorrect information during a recent finance commission. “That speaks to character.”

In addition to the budget kickoff, the City Council will on Wednesday consider a timely request to extend the city’s contract with MV Cheng & Associates, which in July 2022 got a nine month, $115,200 contract to provide temporary staffing for the finance department. City Manager Chaparyan is asking Council approval for a third, $90,000 extension to that deal, pushing its total value to date to $434,000. “Due to the recent turnover of key staff, the department needs assistance in completing the fiscal year end accounting close and audit, while staff begins development of the next fiscal year’s budget,” Downs wrote in an agenda item report.

It was unclear if the decision to extend the MV Cheng contract was made before the city became aware Downs was mulling departure.

Also on the agenda for Wednesday is a $3,500 request to train finance staff on a forecasting model created for the city by NHA Advisors under an earlier $29,500 contract. The degree to which finance staff will be required to use the model in budget development has been a key concern to members of the Finance Commission, who believe it will enforce greater financial discipline on city staff.

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Ben Tansey
Ben Tansey is a journalist and author. He grew up in the South Bay and is a graduate of Evergreen State College. He worked in Washington State as a reporter in a rural timber community and for many years as an editor for a Western electric energy policy publication based in Seattle.