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Home My WebLink AboutStaff Report 2308-18641.Staff Request for Finance Committee discussion for Chief Financial Officer (CFO) Recruitment and input of candidate’s key characteristics Item No. 1.Page 1 of 3 Finance Committee Staff Report From: Kiely Nose, Assistant City Manager Meeting Date: August 15, 2023 TITLE Staff Request for Finance Committee discussion for Chief Financial Officer (CFO) Recruitment and input of candidate’s key characteristics RECOMMENDATION This item is for the Finance Committee discussion and feedback; no action necessary. BACKGROUND The Administrative Services Director/CFO position became vacant when the incumbent Kiely Nose was promoted to the Assistant City Manager position after serving as the Administrative Services Director/CFO for 3 ½ years. Staff is preparing to launch this executive recruitment and receiving the Finance Committee feedback of key characteristics will help guide in the identification of potential candidates. Human Resources has a current contract with Executive Recruiter Teri Black & Company. Teri Black will lead the discussion with the Finance Committee and attain feedback to recruit for a new CFO. ANALYSIS The Chief Financial Officer/Administrative Director role is specified in the City’s Municipal Code. Palo Alto Municipal Code (section 2.08.150) includes the following responsibilities for the Administrative Services Department Director: (1) Provide administrative support for the finance committee of the city council; (2) Management and preparation of the city's budget reports in coordination with the city manager and in accordance with the requirements set forth in the Municipal Code and City Charter, includes analysis and review of citywide revenue and expenses and departmental budget requests; (3) Provide analytical resources for studies on organization, staffing utilization, management and procedures for the city, in order to provide cost-effective municipal services; Item No. 1.Page 2 of 3 (4) To participate in intermediate and long-range financial planning strategies and to develop and recommend methods for financing city programs and projects; (5) Manage production of the city's annual financial reports, general-purpose financial statements, and comprehensive annual financial report in accordance with city ordinances, legal requirements and generally accepted accounting principles: (A) generate appropriate financial reports as required by county, state and federal agencies; (B) coordinate financial audit activities with appropriate parties (internal and external). (6) Administer the procurement of supplies, materials and equipment and contracts for general services for the city. Control emergency purchasing in accordance with approved procedures when centralized procurement is impracticable; (7) Manage and complete the accounts payable and payroll processes; (8) Operate and maintain the warehouse and storage facilities of the city; (9) Administer the city's responsibilities regarding surplus property; (10) Provide centralized mail and messenger services and printing and other duplicating services for all city departments; (11) Administer the investment of city funds and banking agreements in accordance with city policy and state law; (12) Administer and manage the issuance of debt by the city or financing authority entities as may be formed by the city from time to time; (13) Administer and enforce all ordinances and regulations of the city relating to the imposition and collection of city taxes and other miscellaneous accounts receivables, to provide revenue collections services and to collect delinquent receivables; (14) Administer and supervise real property such as secure easement titles and leases, negotiate for the purchase or disposition of real property on behalf of the city, and manage all property owned by the city and leased to other persons or agencies; (15) Perform or cause to be performed all duties required by this code or other law of the director of finance, tax administrator, manager of purchasing, supervisor of revenue collections, chief financial officer, city treasurer and city controller; (16) To perform such other duties as may be required. This position is also responsible for a number of policies and procedures internally including but not limited to: travel, cash handling, loans/debt, gifts, investments, surplus property and assets, user fee cost recovery policy, employee reimbursements, and long term benefits funding policy (formerly pension funding policy). Input and feedback gathered from the Finance Committee and members of the public will assist Teri Black & Company to develop the recruitment brochure as well as to screen potential candidates. The goal is to open the recruitment in September. Item No. 1.Page 3 of 3 FISCAL/RESOURCE IMPACT An executive recruitment for this role is within existing contract authority and salary savings from the vacant position will be sufficient to provide the funding necessary. ATTACHMENTS Attachment A: FY 2024 Proposed Budget Administrative Services Department Report #: 2308-1864 ADMINISTRATIVE SERVICES CITY OF PALO ALTO FISCAL YEAR 2024 PROPOSED OPERATING BUDGET 181 Administrative ServicesMission Statement The Administrative Services Department strives to provide proactive financial and analytical support to City departments and decision-makers, and to safeguard and facili- tate the optimal use of City resources. Purpose The purpose of the Administrative Services Department is to provide excellent customer service to decision-makers, the public, employees, and City departments; provide analytical, organizational, and administrative support for a wide variety of projects; record, monitor, and protect City assets in a respon- sible manner; provide essential financial management and forecasting reports; and prepare and present financial reporting to various committees and City Council. ADMINISTRATIVE SERVICES 182 • CITY OF PALO ALTO FISCAL YEAR 2024 PROPOSED OPERATING BUDGET ADMINISTRATIVE SERVICES DIRECTOR/CHIEF FINANCIAL OFFICER %!(5ƫ+/! ADMINISTRATION 1.00 Administrative Assistant 0.50 Senior Management Analyst āċĀĀƫƫƫƫƫ *#!)!*0ƫ*(5/0 āċĀĀƫƫƫƫƫ )%*%/0.0%2!ƫ//+%0!ƫ INVESTMENT & DEBT 0.60 Manager of Treasury, Debt Investment 0.40 Senior Management Analyst ƫĂĀĂąƫ ƫ 5ćċĀĀ Full-Time ĀċĊĉ Hourly This organizational chart represents citywide Full-Time Equivalents (FTEs) for this department. The Department Summary tables summarize FTEs by position allocation REAL ESTATE 1.00 Real Property Manager 1.00 Senior Management Analyst 1.00 Assistant Director ACCOUNTING 1.00 Finance Manager GENERAL LEDGER 1.00 Senior Accountant 1.00 Accountant 1.00 Lead Account Specialist ENTERPRISE FUND 1.00 Senior Accountant 1.00 Accountant 1.00 Account Specialist ACCOUNTS PAYABLE 1.00 Senior Accountant 1.00 PAYROLL 1.00 Senior Accountant 1.00 Accountant 2.00 Payroll Analyst PURCHASING & CONTRACTS 1.00 Chief Procurement Officer ą.Ā0 Contract Administrator Ă.00 2.00 15!. Senior Buyer OFFICE OF MANAGEMENT AND BUDGET 2.00 Budget Manager 1.00 Administrative Associate III 2.00 Senior Management Analyst 1.00 Management Analyst 1.00 Assistant Director REVENUE COLLECTIONS 1.00 Manager of Revenue Collections 2.00 Lead Account Specialist 5.Ā0 Account Specialist STORES WAREHOUSE 1.00 Warehouse Supervisor 1.00 Lead Storekeeper ą.00 Storekeeper RISK MANAGEMENT 0.40 Manager of Treasury, Debt & Investment 0.10 Senior Management Analyst PRINT & MAIL SERVICES 2.00 Offset Equipment Operator 1.00 %.!0+. 1.00 Lead Account Specialist Account Specialist ADMINISTRATIVE SERVICES • CITY OF PALO ALTO FISCAL YEAR 2024 PROPOSED OPERATING BUDGET 183 Description The Administrative Services Department (ASD) is responsible for the following functions: ADMINISTRATION Provides financial, analytical, budget, strategic, and administrative support services for the department and organization. ACCOUNTING Performs financial transactions and provides accurate, timely, and reliable financial information for internal and external customers, including vendor payments, customer billing, payroll, and financial reporting. PURCHASING AND CONTRACTS Facilitates negotiations, purchasing, and contracting needs in a timely, efficient, and customer-oriented manner. OFFICE OF MANAGEMENT AND BUDGET (OMB) Oversees the citywide operating and capital budget preparation, review, and analysis, performance mea- sures, and budget monitoring. In addition, prepares the long-range financial forecast and provides inde- pendent analytical support to the organization. PROPERTY MANAGEMENT AND ACQUISITION Provides asset management, acquires property rights, manages the leasing of City properties, prepares real estate agreements, completes easement acquisitions/vacations, negotiates real estate agreements, and provides real estate services citywide. TREASURY AND REVENUE COLLECTIONS Treasury safeguards and invests the City’s portfolio, forecasts major General Fund tax revenues, issues and manages debt, and performs Utility Risk Management oversight. Revenue Collections collects payment revenue and provides customer support for parking permits and payment transactions. Provides print shop services to departments and warehouse services, including logistics, for the City’s Electric, Water, Gas, and Wastewater Utilities, as well as for Public Works and the Regional Water Quality Control Plant. Accomplishments •Maintained the City’s AAA credit rating, which results in the lowest possible borrowing costs; confirmed in the most recent rating by Standard and Poor’s and Moody’s in May 2022 and November 2022, respectively. •Achieved investment returns of 2.40%, as compared to 1.61% the prior year. •Updated the Pension Funding Policy to the Retiree Benefit Funding Policy with Council who approved as part of a comprehensive effort to proactively address the City’s long-term liabilities. •Planned for and contributed $8.1 million ($4.7 million from the General Fund) in FY 2023 to the City’s Section 115 Pension Trust Fund, in support of the funding goal of the City’s Retiree Benefit Funding ADMINISTRATIVE SERVICES 184 • CITY OF PALO ALTO FISCAL YEAR 2024 PROPOSED OPERATING BUDGET Policy, bringing total contributions to $54.4 million ($36.8 million from the General Fund) through FY 2023. •Entered into a 40-year lease agreement with the Palo Alto History Museum to restore, preserve, and improve the Roth Building at 300 Homer Avenue as a historic asset and make that asset available to the Palo Alto community through displays, exhibits, interactive demonstrations, workshops, classes, and lectures. The City licensed back a portion of the building for storage and/or display of the City’s official archives and records. •Issued a Request for Information to examine the feasibility of partnering with a private entity on the development of new parking using Downtown In-Lieu Parking Fees, in conjunction with housing or other uses. •Earned the Excellence in Financial Reporting Award from the Government Finance Officers’ Associations of United States and Canada (GFOA) for the FY 2022 Annual Comprehensive Financial Report (ACFR). •Earned the Capital and Operating Budget Excellence Awards from the California Society of Municipal Finance Officers (CSMFO) and the Distinguished Budget Presentation Award and Certificate of Recognition for Budget Preparation for the Fiscal Year 2022 Adopted Capital and Operating budgets. •Implemented the Government Accounting Standards Board (GASB) Statement 87 for new reporting of leases in the City’s financial statements. •Allocated an additional $5.0 million to the Supplemental Pension Trust Fund, $4.0 million to the Capital Improvement Infrastructure Reserve, and established a $14.0 million Uncertainty Reserve to bridge forecasted funding gaps over the next several years as part of the balancing strategy during review of the Budget Stabilization Reserve (BSR). •Facilitated multi-step, complex procurements that support the City’s Infrastructure Plan (Secondary Treatment Upgrades project, Electrical Power Distribution Loop Rehabilitation, Electric Construction Services, Sanitary Sewer Replacement Project 31), strategic and long-term goals of the regional water quality control plant, among others. •Facilitated complex procurements such as Online Electronic Plan Review Software for the Planning and Development Services Department and On-Demand Transit for the Office of Transportation. •Revised the Purchasing Manual to modernize requirements and follow current practices in procurement to help users better understand guidelines and engage the Purchasing process more effectively, and launched a Purchasing Resource Library with guides for City Staff. •Partnered with the Information Technology (IT) Department to introduce online W-2 access for electronic delivery through the City’s data processing software (SAP). Initiatives •Administer the Roth Building lease including mutually developing and ensuring compliance with a tenant work letter. •Implement the City’s Business Tax (Measure K), a Revenue Generating Ballot Measure that was placed on the general election ballot, as directed by the City Council. •Continue to strengthen internal controls for Purchasing through continued education of staff and improved processes. •Review the City’s procurement process, policies and procedures and implement improvements by decreasing the cycle time of the procurement and contract process while ensuring the proper expenditure of the City’s financial resources and ensuring an open, fair and competitive process. ADMINISTRATIVE SERVICES • CITY OF PALO ALTO FISCAL YEAR 2024 PROPOSED OPERATING BUDGET 185 •Continue to consolidate staff resources and tools for Procurement processes and procedures to the Purchasing Resource Library on SharePoint, and implement the new e-procurement Software. •Develop guidelines to address current and potential new tenants at the Cubberley Community Center. •Select and work with a real estate broker to procure a new tenant for the approximately 7,410 square foot two-story building at 445 Bryant Street that was vacated by Form Fitness. Site is formerly the location of the Bryant Street Teen Center and rental revenue would be used to fund programs specifically for Palo Alto youth and teens. •Continue to support the citywide effort on the Enterprise Resource Planning (ERP) upgrade and additional enhancements to improve financial reporting, streamline processes and provide enhancements to payroll processing and timekeeping. •Continue to update the City’s capital asset policy to conform with new internal controls over construction in progress to ensure accurate reporting of capital project costs. •Implementation of GASB 96 to comply with new Accounting standards regarding Subscription Based Information Technology Arrangements (SBITA) accounting guidelines. •Continue to assist with redevelopment plans of the former Los Altos Treatment Plant Site for use by Valley Water as a Regional Water Purification facility and LifeMoves as an Emergency Shelter. ADMINISTRATIVE SERVICES 186 • CITY OF PALO ALTO FISCAL YEAR 2024 PROPOSED OPERATING BUDGET Budget Summary FY 2021 Actuals FY 2022 Actuals FY 2023 Adopted Budget FY 2024 Proposed Budget FY 2024 Change $ FY 2024 Change % Dollars by Fund General Fund-Operating 7,618,435 8,975,585 9,744,883 10,539,018 794,135 8.1% Printing & Mailing Services Fund 1,217,034 1,083,182 1,467,291 1,514,033 46,742 3.2% Total Dollars by Fund $8,835,468 $10,058,768 $11,212,175 $12,053,051 $840,877 7.5% Revenues Charges for Services 36,063 82,830 247,007 249,547 2,540 1.0% Charges to Other Funds 3,730,067 4,331,238 5,546,563 6,443,647 897,084 16.2% Other Revenue 145,158 121,737 171,400 171,400 ——% Return on Investments (2,197)778 100 3,800 3,700 3,700.0% Sales Taxes ——150,000 150,000 ——% Total Revenues $3,909,091 $4,536,583 $6,115,070 $7,018,394 $903,324 14.8% Positions by Fund General Fund-Operating 41.61 38.13 40.13 40.63 0.50 1.2% Printing & Mailing Services Fund 2.10 2.10 2.10 2.10 ——% Total Positions by Fund 43.71 40.23 42.23 42.73 0.50 1.2%