By David N. Young
If the city’s financial situation is not changed soon, Los Alamitos could go broke in as few as six years, maybe seven, the Council heard on Tuesday.
“You cannot overstate the importance of this,” said Mayor Pro-Tem Richard Murphy. “This is bleak. The overall momentum is cascading against us,” he said.
The discussion occurred after Budget Standing Committee members Shelley Hasselbrink and Mark Chirco gave their report on continuing efforts to create a path to long-term financial sustainability.
City Manager Bret Plumlee confirmed that current estimates indicate that city finances will “flatline” in six, maybe seven years.
With city revenues stagnant and expenses escalating “significantly,” mostly due to pension costs, Plumlee said the city’s fund balance was estimated to go to zero by 2024.
“Our situation cannot be overstated,” said Murphy, adding that if spending continued at its current pace with no new sources of revenue, “it is entirely possible the city could go broken in six years, maybe seven.”
Council member Dean Grose questioned rhetorically “what benefits to the taxpayer” is there in having three fully staffed police departments (Los Al, Cypress and Seal Beach) within a very small geographic area, saying the city should consider more consolidation.
Given the seriousness of the situation, both Murphy and Grose seemed to be complaining about their lack of input in the budget committee’ inner workings.
“These decisions are the future of Los Alamitos,” said Murphy, “and this cannot be overestimated. We need to get this information to the public.”
City Manager Bret Plumlee explained to the council the calculated steps, consultants and other measures being explored to eventually make recommendations to mitigate the city’s financial peril.
Council members Hasselbrink and Chirco represent the city’s interest on the standing committee. Both said to Murphy and Grose that they could participate as members of the public, yet City Attorney pointed out they could only sit in the audience and could not participate in the process as it stands now.
Hasselbrink said they were developing a “laundry list” of “revenue producers and expense reducers” to bring back to the Council later this year. She said March of 2020 is the date on which the city must decide if they want to present anything for citizens to consider at the ballot box.
According to Chirco, all of the information discovered and data revealed during the budget standing committee meetings is public. “We’re still in the learning stage,” he said.
While Mayor Warren Kusumoto said he was going to “sidestep” the issue for now, he suggested that if Los Al was a company, they should perhaps also be considering some form of “merger or acquisition” going forward. He did not elaborate.
Though he stopped short of saying it was a problem, Grose questioned spending more than 50 percent of the city’s budget on the police department. Grose said he thought the formation of West Cities Police Communications district was supposed to reduce the public safety costs of Cypress, Los Alamitos and Seal Beach.
He suggested investigating potential savings for the taxpayers in more law enforcement crossover possibilities between the three police departments. Given the small geographical area served by all three, Grose suggested more savings are available than is now being utilized.
“When citizens request an officer to appear at their front door, is there any issue on what uniform they are wearing?”
Chirco said the police department made a thorough presentation to the committee at their last meeting.
Plumlee said the staff will share all information during the process and will at some point bring recommendations and options back to the council.
In other action Tuesday, the Los Al council;
- Heard Bryan Grubor, partner, Lance, Soll and Lunghard, the city’s auditing firm, say there were no issues or difficulties with it annual audit.
- Approved a proposed change in the Master Fee schedule for the city, some of which went up, others that were reduced.
- Learned from city manager Bret Plumlee that the annual state of the city address is currently scheduled or March 20.
- Heard Lanae O’Shields, Public Affairs Manager for Southern California Gas seek their support in preventing the state assembly from passing legislation to make California an all-electric state. Such an effort recently failed, she noted. Natural gas is a cost effective, carbon free fuel that can save money for homeowners. O’Shields said consumers have a right to choose, she said, and natural gas is “clean and renewable.”
