Real Estate and Financial Advisory – Interim City Administrator, 2011/12

City of MontebelloThe City of Montebello was caught without a safe harbor when the U.S. recession hit, as it had spent its reserves and suffered from inadequate and outdated accounting systems and records, City Council recalls, City Administrator vacancies and turnover, a hostile credit environment, and negative media attention stemming from rumors of bankruptcy and a general “looking for the next City of Bell” mentality.  Kosmont was retained in May 2011 to provide Interim City Administrator Services while engineering a short-term financial turnaround and recommending a Five-Year Financial Recovery Plan.

Within 9 months, under the management of the Kosmont Team, the annual Budget was balanced and adopted (with a surplus), and a Five-Year Financial Recovery Plan and a set of Guiding Financial Principles were approved in June 2011.  The City’s credit rating was restored, and a Tax and Revenue Anticipation Note (TRAN) was sold in October/November 2011 in order to address short-term cash flow hurdles.  Focus was then shifted to resolving structural and capital improvement deficits projects for the next five years, along with undertaking more seven audits in six months (e.g. HUD, State Controller, bond insurer, FTA) and the complex task of redevelopment agency dissolution, with focus on strategic municipal asset and debt inventory preparation and cash flow documentation as required by new/modified State legislation.  In order to address these future obstacles, the Financial Recovery Plan was updated to include possible cash flow adjustments (e.g. tax measures, service cuts), key potential economic development projects, and a clear roadmap to keep Financial Recovery Plan on track.