10-30-08, Unedited Version of Herbert Molano Glendale News-Press Community Commentary, “Glendale needs fiscal transparency”

Deep in the caverns of the city's Perkins' building there is a conference room in the finance department where the audit committee meets every three months. There, real discussions about city accountability take place out of earshot of the general public. City officials probably think that the public may not be ready for that level of openness and they'd love to keep it that way. You could say it's by design.

 

Unlike notifications of other meetings displayed in the Events section of the city's website, the only reference to this meeting is found in a cryptic message deep inside: “Meetings are quarterly, typically on a Monday....” The only public notice of the meeting is the one posted amid a dozen other papers near the rear entrance to city hall 72 hours before the meeting takes place. During the meeting, as required by law, they state formally that the notice of the meeting was duly posted. Yet, to the surprise of the members present, last Monday, I was the first member of the public who's attended it in at least four years. It's certainly true that the city complies with the letter of the law – To the most minimal requirement for openness.

 

Unlike other cities that have a publicly elected Controller, Glendale has no equivalent elected figure who is in a position to hold city management responsible for performance outcomes, for effective control of expenditures, for accurate disclosure or for a truly balanced budget. If you were thinking that those are the functions of the city council, you may be forgiven for being gloriously clueless on how the city council has truly performed these past ten years in exercising fiscal oversight.

 

That is not the role of the city treasurer. He may be elected by the public, but his role is extremely limited. California law provides strict guidelines on the types of investments he can make. But overall, he makes few significant policy decisions and he doesn't report on the city's overall financial state. In many cities, the role of the city treasurer is subservient to the controller.

 

Glendale's charter does not provide for an official, independent, publicly elected city controller. We have an audit committee that requires the involvement of city stakeholders – residents, or business owners. The city's internal auditor is accountable to this committee, but the committee's discussions and evaluations are conveniently hidden from public view. You know - by design.

 

The number of financial issues the city faces are numerous and significant enough for the audit committee to discuss in public every month. There is the lack of transparency with regard to the true increase in the number of city employees in the last eight years - The number of full-time equivalent employees. There is the problem of the huge pension investment obligations that now take up over 20 million of the city's outflows and will soon increase significantly as CALPERS investments tank. There is the possible invalidation of the city's transfers from the GWP. Last June, similar transfers were  invalidated by superior court Judge Kenneth R. Freeman in a case against the DWP in the city of Los Angeles.

 

But what the public really needs is a bare-knuckle discussion on the performance of city management, a discussion of its past failures - like huge project cost over-runs, and the real performance of each operational unit.

 

Governmental and fund accounting are concepts vague enough without the city hiding its most deliberative accountability function away from the public. It's time to televise these meetings, make them truly accessible to the public, and hold them on a monthly basis. We are, after all, facing severe fiscal challenges in Glendale. But maybe you didn't know that. Don't blame yourself. It's by design.

 

Herbert Molano

(818)-974-6374

 

References:

 

1.     http://www.ci.glendale.ca.us/audit_committee.asp

2.     http://www.ci.glendale.ca.us/admin-svcs/CAFR/YearEnd6-07/statistical_section.pdf

3.     Pension obligation: CALPERS Annual Pension cost June 30, 2007 = $20,138,463  (See Page 80 of 168 CAFR (Comprehensive Annual Financial Report)