Oxnard Council: Annual Financial Report (CAFR); Citizen advisors (CAG) appointed

By George Miller

Millican

New Oxnard Interim Finance Director Dave Millican (Photo: Citizensjournal.us)

The Oxnard City Council met on 1-27-15 and covered Citizens Advisory Committee appointments; CAFR (Comprehensive Annual Financial Report)

 

Name Date Duration Agenda Minutes Video
City Council Meeting January 27, 2015 04h 40m Agenda Minutes Video

 

 

 

Comprehensive Annual Financial Report (CAFR)CAFR

The City must annually prepare this document, which is a government version of a company annual report, overseen and monitored by the State of California. Notice that it is for the fiscal year ending six months ago, on June 30, 2014. We have asked before why it takes so long and were told that the bureaucracy (local and state) requires certain steps and deadlines that make it that way.

It was presented by the auditing firm White Nelson Diehl Evans LLP, with further commentary by Bob Deis of Management Partners and Dave Millicam, newly appointed Interim Finance Director.

A few major points: the city is barely treading water- net assets have been stable at about $1.8 billion. There are major unfunded pension liabilities of $232 million. Fully funding them is not recommended, but the current situation isn’t good. Current law doesn’t require this to be in financial statements, but it will from now on. There is the accrued employee leave liability of at least $3 million and the ongoing deficits of the golf course and Performing Arts Center ($5.8 million pooled deficits).  The movie theater losses weren’t mentioned at the meeting.

Reported-Unreported

Some liabilities aren’t considered by accounting systems

Most importantly there is an enormous amount of deferred infrastructure maintenance and buildout needs for water, wastewater and streets. This wasn’t precisely quantified at the meeting and is not even addressed in the CAFR or other financial records, but it’s the better part of $1 billion.

General fund revenues are mostly taxes and fees and totaled $106 million last year, up from $101 million. Most revenues are outside the general utilities, accounted for separately and funded by ratepayers.  The general fund is augmented by Proposition “O” 1/2 % sales tax increment money of about $13 million annually.

Major lawsuits could impact the city’s finances. The potential liabilities were not quantified at the meeting. They also warned of inadequate reserves for another major economic downturn and potential layoffs.

We were told that internal controls weren’t audited. Why not?  We were also told that previous audits and statements weren’t considered. Why not?  I asked those questions, received no answers. The auditor said he wasn’t an actuary and so could not evaluate the assumptions/computations behind the unfunded liabilities. Shouldn’t this be done?  The auditor did not audit the Housing Authority, since this was done separately by another firm, Mayer Hoffman McCann.

The relatively low income of Oxnard residents means less tax revenue to meet city needs. Unemployment is a significant problem.

Material errors in the records have been addressed and corrections made and included write-off of some successor agency payable, bank reconciliation errors. Amounts not stated at meeting.

Detailed CAFR numbers were not released in the agenda or at the meeting.

Oxnard CAFR

Staff Report (pdf 948KB)

J-9 CAFR Powerpoint (pdf 200 KB)
J-9 CAFR Audit Presentation (pdf 433 KB)

Oxnard general financial info.

Councilman Perello and some members of the public challenged why utilities should show a profit of up to 20%. City Manager Nyhoff and a public speaker opined that this money will be needed for the huge amount of deferred  maintenance of the infrastructure needed to provide the services billed for.  CPA Larry Stein told us that a sinking fund should be established to properly account for that and establish the reserves needed to address it.

Orlando Dozier wants to see better treatment of unfunded liabilities,including separation by classification, prioritization and time phasing. Dozier worked many years as a budget analyst and project manager for the Navy and Air Force.

Aaron Starr said there should be live links to details in agendi discussing CAFR and other financial matters. Starr is Controller for the nearly $1 billion Haas Automation in Oxnard, largest manufacturing company in town.

Mayor Pro-tem Carmen Ramirez worries about the financial impact of another major economic downturn. She says public safety must be the #1 priority.

Councilman Bert Perello says the city should be utilizing the expertise of members of the public who offer advice, look at the world differently- but that it has failed to do so.

Councilwoman Dorina Padilla said that the financial and budgeting system should be used to help direct policy, not just comply with reporting laws.

 

Citizens Advisory Committee (CAG) appointmentsCAG

Oxnard utilizes Citizen Advisory Groups (CAG’s) to provide input on city policies. There were many candidates.  The voting process was a bit confusing. We did the best we could to record the winners. Please advise us of any errors. Minutes don’t yet show results.

Appointments (we marked apparent winners in boldface, others are candidates not elected):

Homelessness (7 appointments from 11 candidates)

1. Brinkmeyer, Susan 2. Cartagena Martinez, Lucy (2) 3. Castanon, Francine* 4. Courtland, David* 5. Flores, Felipe* 6. Jaena, Francisco V. (3) 7. Lanker, Kathie (2) 8. Miller, Darlene* 9. Ortiz Jr., Federico (3) 10. Rivera, Peggy* 11. Romero, Asencion

Library (5 appointments from 5 candidates)

1. Ascension, Michelle ( 1) 2. Durias, Ruby (2) 3. Kuppennan, Mark* 4. Ragan, John* 5. Reuter, Kenneth

Parks, Recreation & Community Services (7 appointments from 24 candidates)

1. Ascension, Michelle (2) 14. Ocampo Jr., Aurelio 2. Barber, Johnnie* 15. Ortiz Jr., Federico (1) 3. Cobb, Edgar, L.* 16. Palacios, Margot 4. Cody, Donald B. 1 7. Pinkard, Bedford* 5. Edwards, Anthony 18. Poirier, Roger 6. Frost, Dan- Withdrew 1/14/15 19. Postel, Gloria* 7. Garcia, Armando* 20. Reynoso, Juan A. (3) 8. Greene Moraga, Cherie (1) 21. Stewart, Robert (2) 9. Guerra, Lilly (2) 22. Sumersille, Dale* 10. Joneson, Jean (3) 23. Villa, Jack 11. Lemos, Paul* 24. Whitecomb, Angela (Rec’d 1/20/15) 12. Lopez, Adam (2) 13. Moreno, Jaime (3)

StewartVince

Newly appointed Planning Commissioner Vince Stewart. (Photo: Citizensjournal.us)

Planning (7 appointments from 14 candidates)

1. Akin, Debra (1) 2. Cartagena Martinez, Lucy (1) 3. Coyotl, Jose 4. Durias, Ruby (3) 5. Dozier, Orlando (1) 6. Frank, Deirdre* 7. Guerra, Lilly (1) 8. Huber, Stephen H.* 9. Jaena, Francisco V. (1) 10. Murguia, Anthony* 11. Sanchez, Robert V. 12. Starr, Aaron 13. Stein, Larry 14. Stewart, Vincent*

Senior Services (9 appointments from 10 candidates)

1. Brainard, Kay* 2. Esparza, Adamelia (Ady)* 3. Fischer, Ron* 4. Joneson, Jean (2) 5. Lanker, Kathie (1) 6. Madrid, Alice* 7. Owens, Clark 8. Sweetland, Alice* 9. Thiebault, Donald* 10. Yu, Lourdes Villareal*

Community Relations (7 appointments from 17 candidates)

1. Akin, Debra (3) 2. Baxter, Mike* 3. Davitt-Comyn, Theadora 4. Dozier, Orlando* 5. Joneson, Jean (1) 6. Kelly, Travis* 7. Lanker, Kathie (3) 8. Lopez, Adam (1) 9. Moreno, Jaime (1) 10. Ortiz Jr., Federico (2) 11. Quintana, Mario* 12. Reynoso, Juan A. (1) 13. Rivera, Peggy (2) 14. Robinson, Kenneth* 15. Santos Lopez, Adam ( 1) 16. Sorkin, George* 17. Stewart, Robert (1)

Housing Authority (2 appointments from 2 incumbent candidates)

1. Andrade, Jose * 2. Vega, Francisco*

A new Cultural Arts Commission was authorized last year, but no appointments were made to it this week. Mayor Flynn is also initiating a group of CAG Presidents which will meet monthly about the overall CAG effort, sysnergy among them and what can be done to improve them.

A meeting was held a week ago where all of the 70+ candidates were invited to speak and answer questions from Mayor Flynn about why they wanted to be on a CAG and what they would do. For more background on CAFR member selection, read this CJ article.

Some issues raised were training, lack of adherence to parliamentary procedures, attendance, effectiveness and credibility/clout with the City Council. Intent is to address these all in the coming year.

 

 Other

Opposition to oil trains supplying new Phillips 66 SLO refinery

Council voted to send a letter to the San Luis Obispo County Planning Commission expressing the City Council’s opposition to the proposed Phillips 66 Company Santa Maria Refinery Rail Spur Extension Project.

Harry D. Cortez, Hugo Centeno, Jr. and City Corp honored by Oxnard– see a separate article

 

George Miller is Publisher of Citizensjournal.us and a “retired” operations management consultant, active in civic affairs, living in Oxnard.

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