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 90-day plan to address 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.