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CC:HA:PFA - CONSENT ITEM: (1) Approval of an Amendment to the Professional Services Agreement with Ernst & Young U.S. LLP for the Development of a Comprehensive Financial Plan for Culver City and an Analysis of the City’s Reserves in an Amount Not-to-Exceed $665,000 for an Aggregate Total Amount Not-to-Exceed of $714,500; and (2) Other Direction to the City Manager as Deemed Appropriate.
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Meeting Date: August 10, 2026
Contact Person/Dept: Stephen Agostini/ City Manager’s Office
Phone Number: (310) 253-5865
Fiscal Impact: Yes [] No [X] General Fund: Yes [] No []
Attachments: Yes [] No [X]
Public Notification: (Email) Meetings and Agendas - City Council (08/05/2026)
Department Approval: Stephen Agostini, Assistant City Manager (08/04/2026)
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RECOMMENDATION
Staff recommends the City Council and the Boards of the Housing Authority and Public Finance Authority: (1) approve an amendment to the professional services agreement with Ernst & Young U.S. LLP for the development of a financial plan and analysis of the City’s reserves in an amount of $665,000 for an aggregate total amount not-to-exceed $714,500 and (2) other direction to the City Manager as deemed appropriate.
BACKGROUND
In early 2026 the City engaged EY to perform a financial condition and outlook analysis that was presented at the City Council Strategic Planning Retreat and Financial Summit, for a not-to-exceed amount of $49,500.
On April 27, 2026, the City Council approved the creation of the Culver City Public Finance Authority. On June 8, 2026 the City Council adopted a budget for the City and the PFA that allocated, among numerous allocations, $1 million, to be funded from proceeds of the sale of bonds, for various administrative expenses, including retaining a consultant to develop a comprehensive financial plan in conjunction with an analysis of the City’s reserves.
DISCUSSION
As discussed with the City Council during deliberations of the Adopted Budget for Fiscal Year 2026-2027, the development of a comprehensive long-term financial plan will be a critical element to developing sustainable budgets over the next five years. The prospective financial plan, informed by staffing analyses, a capital improvement plan assessment, and reviews of certain operational areas, like transportation, will be designed to assist the City Council in selecting a sustainable fiscal path for policy priorities it identifies at future Strategic Planning retreats.
The proposed team from E&Y has extensive experience and expertise developing comprehensive financial plans for cities, which the City Council saw first-hand during the February 2026 retreat. For this proposed engagement E&Y will build upon the completed financial condition assessment presented to the City Council in February 2026 to establish a risk-informed fiscal baseline that can support the City’s long-term financial planning and decision-making. We expect this part of the engagement will conclude with an updated General Fund baseline and multi-year projections under three economic scenarios.
E&Y will also identify broader contextual factors that may impact long-term fiscal stability to help inform the City’s strategic goals and develop a “strengths, weaknesses, opportunities, and threats” (SWOT) analysis incorporating broader contextual factors, including economic conditions, demographic trends, external funding dependencies, labor relations, and infrastructure conditions. E&Y will assist the City in defining fiscal governing principles and goals (e.g., fiscal foundation cornerstones) and financial targets (e.g., reserve levels, debt affordability, cost recovery, revenue diversification). This will include reviews of existing financial policies to identify areas for potential improvement and financial resilience.
Finally, E&Y will bring substantial strengths and expertise to bear in analyzing whether the City’s current reserve levels, specifically the reserve level for the Contingency Reserve as established in Council Policy 5002, are appropriate for the City given standards and best practices established by advisory bodies like the Government Finance Officers Association. This work will include a risk-based reserve analysis and scenario framework, as well as an Assessment of reserve implications, including considerations for reserve targets and policy alignment.
Per Culver City Municipal Code Section 3.07.065.A., the City may award contracts in any amount for professional services based upon competitive quotations, whenever practical, as determined by the City Manager. Due to the importance of completing the long-term financial plan, it was determined that soliciting additional competitive quotations was not practical.
Staff recommends that the City Council approve an amendment to the City’s professional services agreement with EY to develop a comprehensive financial plan and provide a comprehensive analysis of the City’s reserves, including policies governing reserves.
FISCAL ANALYSIS
The costs for the proposed amendment are included in the Adopted Budget for Fiscal Year 2026-2027 and will be paid from the taxable bond proceeds received by the PFA in its recent sale of bonds. These funds have been budgeted in the PFA portion of the Adopted Budget for Fiscal Year 2026-2027. This allocation is referenced on page 31 of the Proposed Budget for Fiscal Year 2026-2027.
ATTACHMENTS
None.
recommended action
MOTION
That the City Council, Housing Authority Board and Public Finance Authority Board:
1. Approve an amendment to the professional services agreement with Ernst & Young U.S. LLP for development of a financial plan and an analysis of the City’s reserves in an amount not-to-exceed $665,000 for an aggregate total amount not-to-exceed $714,500;
2. Authorize the City Attorney to review/prepare the necessary documents;
3. Authorize the City Manager to execute such documents on behalf of the City; and
4. Provide other direction to the City Manager as deemed appropriate.