San Clemente : City Hires Accountants for Budget Analysis

The City Council has hired an accounting firm to do a cash-flow analysis in light of the county investment pool collapse.

Since the county’s financial debacle unfolded last month, city finance staffers have logged nearly 1,000 hours crunching numbers, and they need time to tend to other projects, said Paul Gudgeirsson, director of management and budget.

The council voted unanimously on Wednesday to pay KPMG Peat Marwick up to $15,000 for the cash-flow analysis and review. The work is expected to take about 133 hours.

Although city officials have described the immediate impact of the county bankruptcy on city coffers as minimal, Gudgeirsson said a financial contingency plan should still be done.

City officials have said that the $34.6 million they had in the county investment pool was nearly all for capital projects and not daily expenses.

A handful of residents questioned the need to hire an outside accounting firm.

One resident said that City Hall had four people who were capable of doing the same work without extra expense to taxpayers.

But some council members, such as Scott Diehl, said that extraordinary circumstances called for hiring the firm.

Diehl said city finance staff had several other projects it still needs to complete in preparing the budget for next fiscal year.

He said that hiring the firm could save the city money in the long run.