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City's Finances Called Sound; Controls Urged : Gardena: Panel also recommends election to determine if treasurer should be appointed instead of elected.

March 16, 1995|KIM STEWART | SPECIAL TO THE TIMES

A committee appointed to examine Gardena's finances has pronounced them sound, but recommended that the council tighten its investment policy.

It also recommended that an election be held to determine whether the city treasurer should be appointed or elected.

City Council members hope the report will ease public concern, which was heightened after elected Treasurer Lorrenzo Ybarra wrote the city manager that the city was having trouble meeting its payroll. Ybarra warned that the council was spending too much money on a deal to develop a Smith's Food & Drug Center at Artesia Boulevard and Vermont Avenue.

The council appointed a five-member committee to do a one-month financial study of Gardena's investments. The committee reported that the city is generally following the council's policy of ensuring that investments are safe, liquid and produce a high yield.

"Everything looks good," said City Manager Kenneth W. Landau. "Gardena's investments are safe and secure, and Gardena is in excellent financial condition."

The committee made nine recommendations that would tighten the council's investment policy and put controls on the city's finances, Landau said. The City Council accepted the report on Feb. 28.

Ybarra said the committee was set up as part of a political vendetta against him, and the recommendations address problems that do not exist.

The committee's recommendations include: distributing city investments to various banks, extending investment maturity dates, evaluating banks before investing city funds, not using brokers and expanding the investment portfolio to include Treasury bills and government notes.

The recommendations to stop using brokers and invest in Treasury bills are being drafted as ordinances that would have to be passed by the council.

The council approved the recommendation to hold an election to determine whether the treasurer should be appointed or elected. It did not determine when the election will be held. Putting the issue on the Nov. 8 ballot would cost the city about $70,000, officials said.

Ybarra said a ballot issue would just be a political move to remove him from office. Landau argued that having an appointed treasurer would provide more of a partnership among city departments.

The committee's report follows a recent audit by Peat Marwich concluding that Gardena is in no danger of falling into the same financial situation as Orange County.

However, Ybarra still contends that the city is experiencing cash shortfalls. The audit, he said, covered July 1, 1993, to June 30, 1994, and the cash flow problems did not arise until December. That month, Ybarra said, the city had trouble meeting its payroll and in February again fell short.

"We've been really scrambling for funds the last few months," Ybarra said. "Luckily we've been able to pull the money in."

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