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A Message For Residents About City Finances

A Message For Residents About City Finances - October 26, 2022

As we enter a season of fall changes and prepare for shorter days leading us into the holiday season, I wanted to take this opportunity to share and provide information that every resident and citizen of Montebello should understand.

There are two important things that matter to all of us, no matter what background or walk of life we come from – those two things are our financial health and our physical health. The old adage is without doubt true “if we don’t have our health, we don’t have anything.” One person, one family’s or one organization’s financial health is just as important in life as our physical health. The financial stability and outlook of an organization like the City of Montebello’s is - and should be - every resident’s concern. Our ability to make improvements, maintain and repair our City infrastructure, build and create new programs and activities, create vital public parks and recreation programs and pay the staff that keep our city moving a fair and decent wage all matter and depend entirely on the status of our financial health.

In order for every resident to understand Montebello’s financial health, where we’ve been and where we’re going, I wanted to present the following highlights and updates – many of which were shared with our essential business, community and regional government partners at our State of the City address held on October 20, 2022.

To begin, the City of Montebello is in very strong financial shape overall. Compared to just three years ago, before the COVID-19 pandemic altered the world, when Montebello was not in as strong financial condition as it is currently. When I arrived, my first statement to all Councilmembers was that we cannot achieve success externally, until we have achieved success internally – by focusing on our people and getting our financial house in order. This process was always going to take years, but I wanted everyone to know up front we had a hill to climb and we have had very good success getting up this hill in just the past two years.

Some of the critical and key achievements have been:

• Achieving a balanced City budget, with a current surplus of over $600,000 in our General Fund. We have done so well a respected group known as the Government Finance Officers Association has given the City of Montebello its Distinguished Budget Presentation Award for an unprecedented third consecutive year.

• We have addressed each and every concern cited in a 2018 California State Auditor’s report that criticized Montebello. Some in the public constantly refer to this report as a black eye on Montebello, but I am proud of the hard work and effort that’s been committed to addressing, resolving or substantially correcting each and every one of these original concerns. We are well on our way towards achieving compliance or improvement with every element of this original report.

• We have brought City operations into the 21st Century with some milestone achievements, including, but not limited to:

- Launching a new, mobile, language and ADA friendly website, completely replacing the old website that hadn’t been refreshed in nearly 15 years.

- We conducted and completed a complete salary and compensation review of all working positions in the City in order to bring our salaries in line with current market conditions, allowing us to compete, attract and hire quality talent in a competitive market. High quality and experienced employees make Montebello a better and more efficient City.

- We signed Memorandums of Understanding with key employee groups representing Administration, Fire, Police, service and maintenance employees which results in better, more effective and balanced labor negotiations, reducing the risk of employment and labor disputes that could negatively impact City operations and your public safety.

- We are actively working to finalize an agreement with Topgolf, one of the nation’s premiere sports entertainment providers that has the potential to transform Montebello into one of LA’s hottest destinations for entertainment activity.

These are just a few of many highlights, but I must focus on where we started, which is with our own financial health. As things weren’t always as robust as they now are. These are the points you should be familiar with as residents:

1. Montebello current has an A+ rating from Standard and Poor. S&P is a globally respected credit rating and universal benchmark that demonstrates transparency and business growth. As stated in the most recent S&P RatingsDirect® report on Montebello:

A. Our financial practices and policies are recognized for being comprehensive quarterly analysis reporting to City Council;
B. They demonstrate a formal investment policy, including a monthly report to Council on our investments;
C. Contain a formal debt management policy with guidance and limitations beyond what’s required by the State of California;
D. They show a formal reserve policy that require at least 25% of general fund revenues to be kept in the general fund, an area that still has much improvement needed, but this report notes “management is working toward meeting this goal going forward.”

2. Montebello’s General Fund revenue is positive and healthy:

A Message For Residents About City Finances 1

3. Our budget management of income (revenue) versus our spending (costs) is well in control, as seen in this 21 year history trend:

A Message For Residents About City Finances 2

4. Anyone can find this information and more posted on our wonderful new website at Critical financial performance information is easily located in the Finance Department section under Budget/Financial Statements.

As you can see, despite what you may hear others saying, the City of Montebello – as of today – is in strong financial shape and poised for future growth and prosperity. Is everything fine and working perfectly? Of course not, and that was never to be expected. Turning a city around requires hard work and effort for several years, assuming things like world-wide pandemics don’t happen. But I am proud of the work your City Council has done, along with my leadership team and the staff that report to them.

Yes there is more hill to climb but we are up to the challenge. It’s most important that you – the residents and citizens of Montebello – understand what has been achieved, and the positive future that is being created. As our new brand concept states, all of us have a role to play in elevating Montebello. I encourage you all to visit and read through our new website for all this information and more.

I thank each of you for your trust and support as we move forward – together.

Your City Manager,
René Bobadilla

Rene Bobadilla