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AGENDA ITEM NO. 19.
CITY OF HAWTHORNE City Council AGENDA BILL For the meeting of 08/26/2025 Originating Department: Finance |
City Manager:
Department Head:
SUBJECT:
Agreement between the City of Hawthorne and RSG Inc. in the amount of $29,870.
RECOMMENDED MOTION:
Staff recommends that the City Council approve and authorize the City Manager to execute the agreement with RSG Inc. to prepare a Long-Term Fiscal Model/Financial Plan and approve a blanket purchase order, not to exceed $29,870.
DISCUSSION:
For a city government, a long-term financial plan serves as a strategic blueprint for managing the municipality's finances over many years. It helps ensure the city can sustainably fund essential services, infrastructure, and development projects while maintaining fiscal health. Here's a breakdown of the key purposes:
1. Ensuring Fiscal Sustainability
• A long-term financial plan helps the city manage its resources effectively to avoid budget deficits and ensures that expenditures do not exceed revenues over time. It anticipates future funding needs and helps set realistic budgets for the long term.
2. Capital Project Planning
• Cities often have large-scale infrastructure projects, such as roads, bridges, public buildings, or transit systems. A long-term financial plan helps allocate funds for these capital projects, ensuring they are completed on time and within budget.
3. Debt Management
• City governments often issue bonds or take on debt to fund large projects. A long-term financial plan helps the city manage and repay its debts over time, avoiding excessive borrowing and ensuring that the cost of servicing debt remains manageable.
4. Economic Stability
• By forecasting future revenues and expenses, a long-term plan helps the city avoid sudden financial shocks. It provides a buffer to withstand economic downturns, changes in tax revenues, or unexpected expenses, contributing to economic resilience.
5. Funding Public Services
• Cities provide vital services such as education, public safety, healthcare, sanitation, and parks. A long-term financial plan ensures that these services are adequately funded and that funding is allocated based on the community's needs and priorities.
6. Risk Mitigation
• City governments face numerous risks, including natural disasters, economic shifts, and demographic changes. A long-term financial plan helps identify and plan for potential risks, such as setting aside emergency reserves or diversifying revenue sources.
7. Tax and Revenue Forecasting
• Cities rely on taxes (property taxes, sales taxes, etc.) and other revenue sources to fund services. The long-term plan forecasts how revenues will grow or decline based on population growth, economic trends, and policy changes, ensuring the government can adjust accordingly.
8. Improving Creditworthiness
• A well-structured long-term financial plan shows investors and credit rating agencies that the city is financially sound, which can help improve the city’s credit rating. This, in turn, reduces borrowing costs for future projects.
9. Sustainability and Environmental Goals
• Long-term plans can integrate sustainability goals, such as funding green infrastructure projects, renewable energy initiatives, and climate resilience strategies, ensuring that environmental considerations are factored into financial decisions.
10. Transparency and Accountability
• A long-term financial plan promotes transparency by providing the public, policymakers, and other stakeholders with clear visibility into the city's fiscal health, future priorities, and expected outcomes. This encourages trust and accountability.
11. Promoting Economic Development
• By planning for future growth and infrastructure development, a city can better position itself to attract businesses, create jobs, and boost the local economy. A well-thought-out financial plan can help secure investments in key areas that support long-term development.
12. Intergenerational Equity
• A long-term financial plan ensures that the current generation isn't burdening future generations with excessive debt or underfunded public services. This promotes fairness and avoids leaving the city's future leaders with financial challenges.
13. Long-Term Community Goals
• A financial plan helps the city prioritize community objectives, such as improving public health, education, housing, or addressing social inequalities. It allows city leadership to make decisions that align with the city’s long-term vision and goals.
Ultimately, a long-term financial plan enables the city to remain financially healthy, serve its residents effectively, and respond to changes in the economic, social, and political landscape.
1. Ensuring Fiscal Sustainability
• A long-term financial plan helps the city manage its resources effectively to avoid budget deficits and ensures that expenditures do not exceed revenues over time. It anticipates future funding needs and helps set realistic budgets for the long term.
2. Capital Project Planning
• Cities often have large-scale infrastructure projects, such as roads, bridges, public buildings, or transit systems. A long-term financial plan helps allocate funds for these capital projects, ensuring they are completed on time and within budget.
3. Debt Management
• City governments often issue bonds or take on debt to fund large projects. A long-term financial plan helps the city manage and repay its debts over time, avoiding excessive borrowing and ensuring that the cost of servicing debt remains manageable.
4. Economic Stability
• By forecasting future revenues and expenses, a long-term plan helps the city avoid sudden financial shocks. It provides a buffer to withstand economic downturns, changes in tax revenues, or unexpected expenses, contributing to economic resilience.
5. Funding Public Services
• Cities provide vital services such as education, public safety, healthcare, sanitation, and parks. A long-term financial plan ensures that these services are adequately funded and that funding is allocated based on the community's needs and priorities.
6. Risk Mitigation
• City governments face numerous risks, including natural disasters, economic shifts, and demographic changes. A long-term financial plan helps identify and plan for potential risks, such as setting aside emergency reserves or diversifying revenue sources.
7. Tax and Revenue Forecasting
• Cities rely on taxes (property taxes, sales taxes, etc.) and other revenue sources to fund services. The long-term plan forecasts how revenues will grow or decline based on population growth, economic trends, and policy changes, ensuring the government can adjust accordingly.
8. Improving Creditworthiness
• A well-structured long-term financial plan shows investors and credit rating agencies that the city is financially sound, which can help improve the city’s credit rating. This, in turn, reduces borrowing costs for future projects.
9. Sustainability and Environmental Goals
• Long-term plans can integrate sustainability goals, such as funding green infrastructure projects, renewable energy initiatives, and climate resilience strategies, ensuring that environmental considerations are factored into financial decisions.
10. Transparency and Accountability
• A long-term financial plan promotes transparency by providing the public, policymakers, and other stakeholders with clear visibility into the city's fiscal health, future priorities, and expected outcomes. This encourages trust and accountability.
11. Promoting Economic Development
• By planning for future growth and infrastructure development, a city can better position itself to attract businesses, create jobs, and boost the local economy. A well-thought-out financial plan can help secure investments in key areas that support long-term development.
12. Intergenerational Equity
• A long-term financial plan ensures that the current generation isn't burdening future generations with excessive debt or underfunded public services. This promotes fairness and avoids leaving the city's future leaders with financial challenges.
13. Long-Term Community Goals
• A financial plan helps the city prioritize community objectives, such as improving public health, education, housing, or addressing social inequalities. It allows city leadership to make decisions that align with the city’s long-term vision and goals.
Ultimately, a long-term financial plan enables the city to remain financially healthy, serve its residents effectively, and respond to changes in the economic, social, and political landscape.
ECONOMIC DEVELOPMENT STRATEGIC PLAN:
.
FISCAL IMPACT:
None. The costs were included in the FY 2025-26 operating Budget.
NOTICING PROCEDURE:
72 hours posted notice pursuant to the Ralph M. Brown Act