'We Welcome Scrutiny' Banning's Fiscal Recovery Begins As City Declares Fiscal Emergency

BANNING, CA — On the heels of a Grand Jury report stating that the city of Banning has suffered years of mismanagement, the Banning City Council says "residents deserve full transparency about their city's finances," according to Mayor Richard Royce.

On Thursday, the City of Banning's new City Manager, Elizabeth Gibbs, released a detailed missive in response to the County of Riverside Grand Jury report, addressing complaints that Banning was in a financial crisis, which residents have already felt firsthand, including delayed utility bills, rising electric rates, and questions about how public utility money was managed.

Gibbs' answer stated that city officials now say the current Council has already adopted a strategic plan, declared a fiscal emergency and has initiated a financial recovery effort — setting up a closely watched formal response due later this year.

The city has not denied the issues presented by the Grand Jury, but has presented a timeline, actions and a formal recovery plan. The city has stated that the issues raised are from prior management decisions and practices. Officials argue that the Grand Jury report is missing timeline context and that, while some conclusions are faulty, others suggest that some of those interviewed may have contributed to the lingering problems and incomplete record-keeping.

In the original Grand Jury Report, concerns were raised that the citizens of Banning had been "deeply affected by poor decisions made by previous management and lack of oversight by city council members."

"The residents were being double-billed monthly for (Banning operated) electric service after not receiving an electric bill for numerous months due to an antiquated and problematic billing system," according to the report. "This ultimately resulted in a catastrophic issue when management finally decided to make a change. This new system was never fully vetted and subsequently failed, forcing the department to return to the oldest version of their current system."

In addition, electric rates have recently been raised with further increases proposed, which is deeply impacting the citizens of Banning, according to the report.

Other issues in the report directly focused on personnel, citing the city has run through "ten City Managers over twelve years."

According to Mayor Richard Royce, the city "welcomes the Grand Jury's scrutiny.

"Banning residents deserve full transparency about their City's finances," said Royce. "What this report doesn't capture is the work already underway — the Strategic Plan, the Fiscal Emergency declaration, and the difficult decisions this Council has been making since before the report was even released. We're not just acknowledging the problem. We're solving it."

The current Banning City Council has already found, recognized, and discussed in open session the general lack of past management controls within the City, which is apparent for the previous six or more years.

"If one reads Banning’s Strategic Plan, it is clear the City Council agrees with or is already implementing 7 of the 9 Grand Jury recommendations," according to Gibbs' letter. "The current City Council and its new administrative leadership have already been actively working on these issues, prior to issuance of the Grand Jury report. We will consider the other 2 with the backdrop of a seriously impaired general fund budget."

The Council has said they are looking to Banning’s Strategic Plan, which details how they are already implementing 7 of the 9 Grand Jury recommendations.

"The current City Council and its new administrative leadership have already been actively working on these issues, prior to the issuance of the Grand Jury report.

"We will consider the other 2 with the backdrop of a seriously impaired general fund budget.

"Again, we look forward to providing a robust response to the Grand Jury’s report, which will include correcting any confusion, consistent with the Grand Jury-established timelines.

"The current City Council and current City leadership have been working to identify concerns and past practices that have led the City into its current distressed condition.

"It took years for the City to find itself in its current condition. Placing the City on a sustainable path will not happen overnight," they wrote. "The needed course correction is underway and will require difficult decisions as well as implementation of the Council adopted Strategic Plan and Workout Plan to Fiscal Sustainability."

The Council presented the first phase of the Declaration of Fiscal Emergency, which it initiated at the June 23 council session.

"This provided direction to the City Manager on the first phase of the city's fiscal recovery, Banning's Workout Plan to Fiscal Sustainability," according to the release.

For now, all eyes remain on what the Council will actionably do next. The Grand Jury has looked to the community as the final key to resolving the city's many issues.

"The City of Banning is a community filled with warmth and pride. While steps are being taken to strengthen the financial and organizational weaknesses, the Grand Jury has concerns regarding the volume of problems the City is facing and feels a solid strategic plan (that is adhered to), strict fiscal discipline, disclosure of past mistakes, and future open and honest communication will help to avoid future negligence and allow this well-deserving community to prosper."