Oakland City Council clashes with finance director as 37 police vehicles idle at dealership ...0

OAKLAND — With a special election two weeks away, the Oakland City Council is finding itself at odds with an unelected official whose expertise has lent her particular authority at a critical time for the city’s finances.

Finance Director Erin Roseman appears to have taken a more hands-on role at City Hall as it grapples at once with a perilous financial crisis and a vacuum in leadership following the successful recall in November of ex-Mayor Sheng Thao.

In recent weeks, city leaders have openly clashed with Roseman over what would seem on the surface like basic procedural decisions, such as completing the purchase of 37 police vehicles waiting to be picked up at a local dealership.

Tensions have flared to the point that Councilmember Rebecca Kaplan likened Roseman’s decisions in a recent internal email to a “pattern of lies.” The email — obtained by this news organization — was addressed to Deborah Edgerly, one of two consultants the city hired in February to assess its finances.

“She does not have, legally speaking, the authority to overrule the council,” Kaplan said of Roseman in an interview. “But sometimes she just doesn’t sign the checks.”

Roseman and another top official, Budget Director Bradley Johnson, report to City Administrator Jestin Johnson — a trio tasked with providing updates on the city’s finances to the city council, which sets policy but cannot directly manage city staff.

The schism is reaching a boiling point weeks before Oakland voters select a new permanent mayor — the only person who can hire or fire a city administrator. Councilmember Kevin Jenkins is filling in as interim mayor until the April 15 special election is certified.

Roseman, whose 2021 hiring announcement called her a “seasoned finance professional,” has handled top-level duties assessing the city’s finances in the crucial years after federal coronavirus relief dried up.

She previously worked in public finance at the city of Arlington, Texas, where she also received a master’s degree in public administration, per her public profile. After initially agreeing to comment for this story, Roseman did not respond to multiple interview requests.

While Kaplan has led a public charge against Roseman, councilmembers Janani Ramachandran, Zac Unger and Carroll Fife have also questioned and criticized the finance director.

Roseman has also drawn the ire of the city’s transportation director, who called out the finance department in a recent memo for “delays to routine approvals” in parking-management funds, along with public works officials for similar funding freezes.

In another instance, city officials railed against Roseman and Assistant City Administrator Harold Duffey for delaying the issuance of bonds that would fund new street-paving projects and affordable housing developments in Oakland.

Duffey and Roseman’s justification for waiting — that the city’s credit rating is not high enough to secure strong investments — did not convince the councilmembers, who opposed the idea of keeping long-needed infrastructure improvements on the back-burner.

But councilmembers seem particularly irked that 37 police vehicles have waited since late last year at a Ford dealership in San Leandro with no one collecting them, according to correspondence shared by Kaplan. Officials at the Ford Store declined to comment.

By all accounts, the city has purchased patrol cars and fire trucks and engines for years through its equipment fund, which Oakland’s budget policies state should cover “the cost of maintenance and replacement of city vehicles and other motorized equipment.”

But in mid-2023, Roseman abruptly stopped allowing the fund to help buy equipment, citing both a 2009 city audit and a longstanding federal policy that she said has been in place “for many decades” precluding grant money from being used to buy equipment.

“If the city has been inappropriately charging (vehicle acquisitions) to federal grants, that is a practice we should not be engaged in and we should not continue with, whether it was purposeful or accidental,” she said last week at a city council subcommittee meeting

But when questioned at the Public Works and Transportation Committee meeting about the timeline behind the policy change, Roseman requested that the discussion be taken “offline” — or out of public view.

Both elected leaders and staff have questioned the findings and policies Roseman cited, noting they don’t appear to directly address why the city can’t pick up the sidelined vehicles with all the non-grant money that still exists in the fund.

“The whole purpose of using (this) fund was to purchase equipment,” said Dan Lindheim, a former Oakland city administrator who served during the Great Recession and now teaches public policy at UC Berkeley. “It doesn’t make sense to me that you can’t purchase police cars from the equipment fund.”

On certain decisions, even Ramachandran, who last year took a strong stance against the financial judgment of her council colleagues, said she did not understand Roseman’s thinking.

“It’s very confusing to me why we have this money we can’t use,” said Ramachandran, who added, about the delayed bonds, “I do not know why administration and finance are trying to block that so badly.”

Ramachandran was among the few elected officials to oppose a proposal by Thao last summer to bet on revenue from the city’s sale of the Coliseum to balance the budget.

Roseman appears to have also disagreed with Thao’s gamble — a move widely criticized by financial experts as short-sighted, especially after the massive land sale did not conclude within months, as Thao promised it would.

In December, after voters had approved Thao’s recall, Roseman authored a finance report warning the city was on the verge of bankruptcy and pointedly advising city leaders against “fecklessness” in their continued spending.

The report was edited by Johnson to soften the language, but somehow the original was published online before being taken down and replaced with the edited version. The switcheroo went off like a powder keg at City Hall, with officials rushing toward damage control.

Some of Roseman’s recommendations proved prescient: in January, the city announced layoffs of dozens of workers and deep spending cuts. Others apparently went too far, including her call for the city to declare a fiscal emergency — a route avoided when Kaplan found money in other funds that the council could tap to keep its finances afloat.

The city is not in the clear, facing a $140 million budget deficit next year that is structural in nature, meaning it stems from fixed costs outpacing revenues. One potentially helpful boost: a proposed sales tax that would raise $30 million annually.

Voters will decide whether to approve the tax measure on the April 15 special ballot, which along with electing a new mayor will find a new councilmember for the District 2 seat that Kaplan is currently filling on an interim basis.

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