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Responding to pressure from citizens, South Pasadena City Council on Wednesday May 1 will decide whether to bring back the controversial Finance Ad Hoc Committee it voted last month on a split 3-2 vote to dissolve.
Council established the FAHC February 21 after hearing a presentation based on a model developed by city contractor NHA Advisors projecting current and general fund deficits ranging between $1.8 million and $3.9 million over the next five years.
That prompted Mayor Evelyn Zneimer to declare a “fiscal emergency.” It caused the city’s standing Finance Commission to delay Finance Director John Down’s request for approval of his mid-year budget report, delaying commencement of the new budget cycle. The Commission also responded with a list of recommendations–including a freeze on non-essential spending and hiring–pending assessment of the implications of the deficit projections.
Council acted to set up the FAHC “to study, review and analyze the city’s finances and operations in light of the projections,” city attorney Roxanne Diaz wrote this week.
But friction between Downs and members of both the FAHC and the Finance Commission led Council Members Jon Primuth, Michael Cacciotti and Jack Donovan to lose confidence in the FAHC; after a contentious discussion March 20 during which Primuth accused FAHC vice chair Sheila Rossi of making false statements, they voted to rescind the FAHC over the objections of Mayor Zneimer and Council Member Janet Braun, both of whom were among the four FAHC members.
That stunned some citizens still reeling from the February deficit projections. At its April 17 meeting seven citizens petitioned the Council to re-establish the FAHC. These included former Mayor Harry Knapp, who said the city should avail itself of its good fortune in having a reservoir of local talent among its citizens who are willing to serve. “Whatever is wrong has to be fixed and I think you should keep the [FAHC],” he said.
Citizen Mary Urquhart said the projections were “deeply troubling,” while staff proposals to impose “immense” new fees for use of city facilities used by popular groups such as Little League, AYSO, South Pasadena Education Foundation and others were “equally disturbing.” The same people should be named to the re-established FAHC. “There is no reason not to want these these four individuals so we can get our city’s finances under control.”
Similar sentiments were expressed by Delaine Shane, who also pointed to chronic instability in finance department staffing. She said the FAHC should be reinstated, that finance staff should deliver a balanced budget and should follow existing policies on the delivery of accurate information. “The details of the city finances are confusing at best. I expect transparency in our government. This mess clearly didn’t happen overnight but we need to change our situation to change the course of our city and secure its financial stability.”
Chris Bray, Karissa Adams, Dolly Chapman and Betty Emirhanian also demanded the FAHC be reinstated. “Clearly a $3.7 million deficit is a problem,” wrote Emirhanian, a 50-year South Pasadena resident. “The fact that our city’s finance department is in complete disarray means that we are not in a position to manage and plan our finances, which means that the deficit will most likely only grow.” She could not understand why the group was disbanded “just at the time we need it most.”
But on March 28 the Finance Commission took another look at and recommended approval of the mid-year report and the Council signed off on it at its meeting April 17.
“I would say in this moment it does not matter” that the FAHC was rescinded, Finance Commission Chair Peter Giuliani told the South Pasadena News.
Moreover, the Commission secured Council’s assent on its highest priority recommendations. During a joint meeting also on April 17, the Council voted and the Finance Commission, as Chair Giuliani noted, “enthusiastically concurred” on a joint vote directing staff to reserve “some amount” in the new budget for unexpected appropriations; to have a balanced budget; and to use the NHA model to update the notorious five-year projections and present those to both the Council and the Commission.
