While Kiff may have been on vacation recently before hitting the ground running, he did talk with this writer about his plans for Newport Beach.
Considered by many to be the “Beverly Hills of Orange County,” Newport Beach is known for its multi-million dollar homes, and posh restaurants and boutiques, but it’s not all about yachts and where the next vacation is going to be. It, too, has been bit by a few issues.
“We have been fortunate, however, because we have a pretty diverse revenue base and it involves a significant chunk of money that comes in from income properties from the Balboa Bay Club, and a number of residences that sit on tidelands leases,” Kiff explains. “We also have a good hotel, retail and restaurant base. All of those things help us and then layered on top of that is a very stable property tax base. However, we’re not out of the woods.”
Has the unstable economy affected Newport Beach? Yes.
“Our sales taxes are down below our projections and indeed our projections are pretty conservative, but we routinely count on year-to-year increases,” he says. “We have had a year and we may have another year of decreases that are significant – 4 to 5 percent. Granted, they are not what other cities are seeing, so I am thankful for that.”
Hard to believe but Newport Beach also has a number of foreclosures – not as many as other communities, but it does.
“I think that is in part because our ownership is older – not as in age – but older in tenure,” he says. “We have a lot of people who didn’t go upside down in their houses.”
Another challenge and perhaps one of the biggest in Newport Beach will be dealing with pension costs.
“All of the cities up and down the State — to varying degrees — are dealing with a shorter budget problem, but they are also worried about this long term budget problem … that is the pension costs of the city workforce,” Kiff says.
The answer, however, may be simple: change the pension system by making it two tiers.
“The second tier might be directed toward new employees or working on the existing system for current employees to modify what they do and what they pay for,” he says. “For new hires, the second tier would be a defined contribution plan instead of a defined benefit plan, as is standard in the private sector.”
Another thing on Kiff’s to-do list is to recruit and hire a police chief.
“We need a strong chief who is very interested in delving into the management issues of the department,” Kiff shares. “I say that as opposed to someone who wants to get involved in regional or statewide activities. We need someone who is going to spend some time within the department. Someone who wants to really see it mature further, including fixing promotional processes and the like.”
Don’t get him wrong, it’s not like Newport Beach hasn’t been blessed with top staff.
“Our former chief wasn’t an imperial chief – he was very much the kind of guy you’d see walking in the street and talking to people about how the policing was going.”
Besides these issues, Kiff says that his first order of business will be to get a good overview.
“I want to start by looking at the departments to see if we can do more things efficiently with fewer resources, including people,” he says. “We have a lot of retirements coming up and I want to take advantage of that to change the organization.
“We, like many organizations, have a significant number of staff who started here early in their careers and worked up into middle management in a natural progression,” he continues. “Yet, I am not so sure we need those same roles anymore. We need to ask ourselves, ‘if we were starting from scratch, would do things the same way?’ Another priority is the hiring of a new finance director to replace the one retiring soon.”
Overall, the City of Newport Beach is in good shape, Kiff is quick to state.
“We are very fortunate that most of our problems involve quality of life issues, like neighbor-to-neighbor disputes over the size of a house, or the height of trees,” he explains. “We also talk a lot about transportation and making sure traffic moves smoothly. And that the city both respects the business sector and residential neighborhoods – city government needs to support the special quality of life associated with Newport Beach.”
A Different Perspective
Kiff, 44, says besides these issues, he does have a unique perspective about the State’s budget. How so?
“Well, I worked for the State Legislature for 8 years and what that does, is make me more sympathetic toward what the legislators and the Legislature itself is going through. It really isn’t as easy as attacking the State Legislature and saying, ‘look ya boneheads how come ya can’t balance the budget?’ We, as voters, have set them up to fail.”
While he says this half jokingly, Kiff does have some frustration for the Legislature as in “whatever it does decide to do – it should decide to do it on time, not after cities and counties have adopted their on-time budgets.”
“There is no excuse for that. Whatever path the Legislature chooses, i.e., the local government borrowing, which I believe remains a bad idea because it punts a problem into the future, I can still see why the Legislature does that,” he says. “We have so tied their hands with voter initiatives that they can’t help but punt part of the problem forward. We have set them up to have to do that each time.”
He says he believes that the State finds itself often in dire straits because of its reliance on sales tax and income tax.
In other words, Kiff says when the economy is “going gangbusters, the money comes in at that level and they tend not to lock it away in a rainy day fund.”
“… Although they have done better the last few years,” he says. “But when the bust times come, then it hits them even harder. It’s the sales and income tax that puts them upside down; if there was a way and there is a way – to balance out their revenue base so it is not so susceptible to boom times and bust times, I think part of the problem would be solved.”
The other part of the problem Kiff says is that we, the voters, “ballot box budget” and then just expect that the legislators will be able to do their jobs. “But those two things don’t go together.”
He says we either have to “stop ballot box budgeting or fully admit that we, the voters, have in effect, become the Legislature and that it’s our burden to solve the problem.”
“I obviously would not like to go that way,” he adds. “… We have a Legislature for a reason. We should give them all of the tools that they need to adopt a budget and propose policy solutions … then just let them sink or swim on that.”
Looking ahead, Kiff is excited about his new role as city manager and says he is ready for the challenges.
“I think people see me as accessible and open,” he says of his popularity, after all, people are talking and writing in that they ‘can’t wait for him to begin.’
“I really try not to hide anything, especially about government, because I think that people immediately get suspicious if they perceive you are trying to hide or keep something from them,” he says. “I am very willing to lay out all of the mistakes and problems that our government has, as well as our solutions because I think people appreciate that.”
The writer, Debbie L. Sklar is a 20-plus year journalism veteran residing in Southern California, where she is a writer, columnist and editor for many local, regional and national publications. She is a regular contributor to PublicCEO.com and may be reached via e-mail at