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California City council tussles over missing monthly financial statements as consent items move forward
Summary
Councilmember Smith and multiple public commenters pressed the council for current monthly financial reports and questioned whether protected reserve balances and fund statements are accurate; council approved several consent items while agreeing to resume monthly reporting next month.
Councilmember Ron Smith repeatedly urged the City of California City to withhold or delay spending until the city produces current monthly financial statements showing fund balances, saying, “We haven't gotten a monthly statement since June,” and arguing that council should not approve expenditures without written verification.
The dispute surfaced during consideration of the consent calendar, when Smith proposed trailing CC1 (a fiscal item tied to bills and payments) because the last complete monthly report with fund balances, he said, dated to June. The city attorney and mayor replied that approval of the meeting agenda itself does not carry the same legal threshold as approving ordinances or the payment of money; the attorney said certain approvals require an affirmative vote of three members but the agenda may be adopted by majority.
Despite Smith's objections and public testimony alleging multiple funds showing negative balances and restricted cash, the council voted to approve items CC2 and CC3 (minutes and a successor-agency recognized obligation payment schedule). Councilmember Smith’s motion to delay CC1 failed for lack of a second, and the council agreed staff will resume monthly reporting, with the intention to bring fuller monthly reports in February.
Public commenters and an independent finance critic urged that future monthly statements be certified by a CPA and that Price Page, the contracted accounting firm, provide signed statements. One commenter said the city had 16 funds with negative cash balances and an unrestricted general fund that was negative $1.2 million as of recent reporting; the council and finance staff said they will provide clearer documentation and track responsibility as reports return.
The city did adopt CC4 (a development-fee study) and CC5 (a resolution regarding protected balances) after extended debate. On CC4, Mayor Pro Tem Creighton and staff described prior council decisions to waive residential impact fees and the Prop 218 constraints that influenced fee collections. The council directed staff to return with a resolution to consider reinstating residential impact fees. On CC5, Smith argued some reserve transfers lacked a four-fifths vote; the council discussed recordkeeping and voted to adopt the resolution.
Next steps: staff said monthly reporting will resume at the first regular meeting in February and the council asked for written detail on grant and revenue items, including the status of Price Page deliverables and a midyear budget review.
