The California State Auditor determined that Torrance is in the fourth worst financial condition of any City in the State. This white paper outlines my approach to solve the City's financial crisis.

The Problem

• Expenses have exceeded revenues for nearly all years since 2016. Fundamentally, this requires a realignment of the City’s financial model.
• Nearly half of the general fund – which pays for public safety, libraries and parks – is financed by sales taxes and utility users tax.
• From 2016-17 - 2019-20, and especially during COVID, these sources have been flat or declining. More online shopping means less in person shopping – and the City receives pennies from online sales but $1 for every $100 spent at the mall and other retail establishments.
• As the Torrance business community shifts from heavy industrial to light industrial, technology and service based firms, the City receives less from utility users tax.

Solutions To Tackle These Problems

• Tackle the City budget head on to ensure Torrance can continue to provide necessary  services.
• Embrace a culture of cost reductions, especially scrutinizing City spending related to back office operations, working with all parties to reduce expenses.
• Develop a zero-based budget, where expenses match revenues.
• Scrutinize services to ensure they are critical to City functions (and not provided by other agencies) and are executed with appropriate spans of control.
• Integrate staff feedback for new processes that reduce expenses.
• Eliminate paper and manual processes by expanding the City’s IT infrastructure and online transactions.
• Develop revenue enhancement plans focusing on new business attraction, tourism growth and promoting Torrance as a shopping destination.
• Developing Key Performance Indicators to ensure ongoing focus for City finances, improved operational outcomes and quality customer service.

Experience/Qualifications to Lead the Plan

• Helped lead the City out of the Great Recession as a Councilman. Actions included making tough decisions to align expenses with revenues; leveraging federal funds to help re-shape City operations; and revamping how City funds were used to provide City services.
• During the Great Recession, advocated that the City seek feedback from staff to reduce costs.
• Continued to maintain and grow reserves at El Camino College, whose current reserves are more than 2 times the City’s reserve levels.
• Insisted that El Camino leadership avoid a structural deficit for its post-COVID budget, aligning revenues and expenses.
• At El Camino, advocated and approved a special reserve fund to accommodate the state’s constantly changing retirement funding levels.
• As Councilman, approved plans to reduce City’s pension obligations.
• In multiple organizations, revamped operations, utilizing IT solutions and lean engineering to solve core business problems.
• Part of the national leadership team at the Red Cross, which reduced annual expenses by $500 million.
• Directly drove $100 million in expense reductions, through strategy changes, performance management and improved productivity.
• Professionally, grew revenue by $200 million over six years, focusing on critical products.
• In business and nonprofit leadership, developed and managed key performance indicators, in operations and customer service, to drive improved results.