Fiscal Prudence – Qualifications for City Treasurer Position

The City treasurer position held by Laura Parisi is being challenged by local resident Anne McGraw.  Ms. McGraw is endorsed by Council members Boyd, Whalen, Zur Schmiede and Dicterow.  The issue for residents has become whether the position requires a CPA with City Government and investment experience vs a small business bookkeeping level professional.

LagunaBeachCHAT has weighed the arguments on both sides and believes that fiscal safety of our city’s investments is more important than any poorly understood, but likely small cost-savings that might be realized by having a part-time bookkeeper looking after the investment portfolio.  We have also learned that ensuring that the City’s investments are compliant with numerous State and local mandates requires specialized knowledge and a considerable and constant time commitment on the part of whoever undertakes the task.  We therefore believe that fiscal prudence calls for entrusting the City Treasurer position to the more qualified, CPA candidate.

Read more on this issue.

Setting the record straight about Parisi
Courtesy of Stu News

Misrepresentations are circulating about compensation paid by the City to our treasurer, Laura Parisi. Let’s set the record straight. Your vote should be based on truth, not exaggeration and misinformation.

Laura’s base salary is $6450 per month ($77,400 per year), plus the benefits other City employees receive. For the last several years the Council granted her exceptional performance pay, up to 5 percent, and Laura has also taken the additional responsibility of reviewing our hotel bed tax, the Transient Occupancy Tax.

In 2015, the City chose Laura to resolve a complex accounting problem. She spent hundreds of hours correcting an error the City (not Laura) made on a document submitted to the federal government. Neither the City or the outside auditor caught the error. It was discovered by our new auditing firm. Regardless of the responsibility, it had to be addressed. Laura had the skill set and we asked her to complete the task.

The Laguna Beach City Council selected a subcommittee to determine appropriate compensation for Laura’s work. Steve Dicterow and I, as the subcommittee, recognized that we did not have the expertise to understand the complexity of this task and what was necessary to correct the errors. We sought a respected local CPA to determine whether Laura›s request for compensation was appropriate. He confirmed that her request was appropriate. And he added that if we were forced to use an outside firm, the cost would have been much higher.
Other comments have surfaced in an attempt to malign Laura’s reputation and integrity. Remarkably she’s been accused of being overqualified. Doesn’t Laguna deserve the most qualified to serve us? Not only is Laura a CPA, she is the only CPA working at the City. She has the training to be a Watchdog for the City and the Public.

Cities without this independent and qualified oversight run increased risks of improper handling of funds. Recently millions of dollars were embezzled from the City of Placentia.

What a shame it would be to lose Laura as our Treasurer.

Toni Iseman
Mayor ProTem
Laguna Beach

Letter from Victoria McIntosh

As you all know I am not generally a person who is outspoken on any topics, least of all politics, but as this election season is coming to a close I feel I have to make an exception.  I want to address something in our town that I am passionate about, and which I have a lot knowledge about that might make a difference in how you decide to vote in a few weeks.  I’m talking about the race for City Treasurer (no, I’m not running!), and I’m concerned that there’s a lot of inaccurate talk going around that could lead to well-meaning voters making an uninformed  – and unfortunate – choice.

Before going into the details, let me tell you where I’m coming from.  As you may or may not know, I have been a Certified Public Accountant (CPA) for 30+ years and have vast experience in Finance, Accounting & Taxation. So what I’m about to say is not personal. It’s based entirely on my knowledge of private and public accounting and finance, and the differences between them.

I know and like both parties who are running for City Treasurer, and believe both candidates are nice, friendly and generally good role models.  Both are active in our community and there’s no doubt they both have Laguna Beach’s best interests at heart.

But there is an enormous difference in what our city needs in the role of Treasurer and in what individual taxpayers and private businesses need in their personal bookkeeper.

The City’s annual operating budget and day-to-day accounting activities are performed by the Finance Department, which employs a Finance Director and various personnel including bookkeepers.

This is separate from the Treasurer who is the check and balance to those who keep the books, is our Chief Investment Officer and administers the assessment districts.  The Treasurer is elected by Laguna Beach residents, and has the fiscal responsibility to manage the City’s (OUR) money to make sure it grows and is protected.  The Treasurer has to have

  • In-depth knowledge and understanding of compliance with and implementation of complex state and city laws and regulations, which differ greatly from private sector rules and practices;
  • A thorough understanding of financial reporting according to Generally Accepted Government Accounting Standards, again very different than private sector standards;
  • Expertise in the highly specialized field of municipal finance including bond administration and continual evaluation of financing alternatives in the context of financial conditions that can change daily;
  • Reporting to the SEC (Security and Exchange Commission)

I could go into much greater depth on this but I probably lost you at “ACCOUNTING” – J

Anyway the City Treasurer is elected independently by all of us, the citizens of Laguna Beach, versus being appointed by the city.  This is a for a reason!  The person we elect has OUR backs and critically needs to have the knowledge and expertise to do so. The Treasurer protects and responsibly grows our money so the City can safely operate within our approximately $80 million annual revenue budget, and build and maintain reserves that make it possible for the City to invest in capital projects and improvements for the benefit of we local residents.

The difference between the qualifications and experience of the two candidates is immense.

Laura is a Certified Public Accountant, a Certified Municipal Treasurer and Certified Fixed Income Practitioner.  During her years as our City Treasurer revenues have doubled and investments under management have tripled. In addition, Laura’s solid competence and expertise have been recognized by municipal finance experts statewide, who have chosen her as the current Vice-Chair of the Orange County Treasury Oversight Committee (this is where the schools keep their money); Board Member for the State of California Local Agency Investment Board, and Chair of the Revenue and Taxation Committee for the League of California Cities.

The challenger for the City Treasurer position started a local bookkeeping business in 1998. She should be commended for her decision to run as Laguna Beach’s City Treasurer in order to utilize her skill sets to benefit our great community. Unfortunately, bookkeeping skills are simply not adequate to responsibly and successfully fulfill the complicated duties of Laguna Beach City Treasurer, including the stewardship of our $90 to $100 million investment portfolio.

The argument I’ve heard most in favor of changing Treasurers is that a change can save the City money.  With all due respect, this is naïve at best and incredibly risky at worst. As it is, the budget for the Treasurer’s office is a small fraction of one percent of Laguna Beach’s total annual $80 million budget and even less than that as a percentage of the City’s investment portfolio, so any savings would be symbolic but not in the least bit material. Let me assure you that in the world of finance you do get what you pay for, and if we go down that road we will be very unhappy with what we ultimately get.

Again, I would have preferred to remain quiet on this but decided to write as I felt strongly I had a duty, with my expertise, to make sure my friends have all the facts before making this important decision.