Developing Appropriate Financial Policies in San Clemente, California Pall Gudgeirsson, Assistant City Manager/City Treasurer Rising to New Heights in Finance CSMFO, Palm Springs, California, February 22, 2006
Page 2 Introduction Why San Clemente Developed a Fiscal Policy? –City coffers virtually empty in 1992 –Reserves non-existent or unfunded –Projected deficit balances –Failing infrastructure –Declining revenues –Increasing expenditures Successful? “Trouble In Paradise”
Page 3 “About the time we can make the ends meet, somebody moves the ends.” –Herbert Hoover Fiscal Policies: Means To An End…
Page 4 Long-Term Financial Planning – A Definition Identifies fiscal issues and opportunities Establishes fiscal policies and goals Examines fiscal trends Produces a financial forecast Provides for feasible solutions
Page 5 Long Term Financial Plan – The Process 1. Build the Foundation a)Financial Policies b)Financial Trends c)Financial Forecast 2. Identify Critical Issues 3. Develop the Plan 4. Implement the Plan 5. Monitor the Plan
Page 6 Random Thoughts on Fiscal Policies Tips, Traps & Other Observations From the Beach –“The closest thing we ever had to a Fiscal Policy was a two year budget” –A San Clemente Council member
Page 7 10.Decide on detailed or general policies 9.Get ahead of the game! 8.Be realistic & objective 7.Brief the press 6.Update annually Top Ten Tips
Page 8 5.Be sure that stakeholders have input into establishing the policy 4.Tie development of policies to LTFP, Budget & CIP 3.Show progress in meeting policy requirements 2.The policy should be a “living will” Top Ten Tips
Page 9 1.Policies should be “goals” or “challenges” Bonus Tip: Develop a policy when you get home… Top Tip!
Page Not preparing because they are too much work 9.Using dollar amounts in policies 8.Copying other entity’s policies 7.Not informing your employee associations of reserve policies 6.Not providing enough information to legislators Top Ten Traps
Page 11 5.Getting too detailed 4.Allowing your policies to get out of date 3.Not following or delaying implementation of policies 2.Building it if you can’t maintain it "Build it and the money will follow“ (Beaches, Parks & Recreation Director) Top Ten Traps
Page Not including a policy specifying use of one time revenues Bonus Trap – Developing in “crisis” mode Trap #1 !
Page 13 Review Examples (See Handouts) City of San Clemente City of Sunnyvale City of Long Beach
Page 14 Questions & Answers “I didn’t really say everything I said.” –Yogi Berra Illustrations by Pablo Bargueno City of San Clemente, GIS Mapping Specialist
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