Amid fiscal crisis, Montebello’s interim city manager resigns

The city of Montebello, already facing the prospect that it may not be able to pay its bills by the end of this year, sank deeper into crisis Tuesday after the interim city manager abruptly resigned.

Peter Cosentini sent council members a letter informing them that he was stepping down because he was “no longer comfortable with our progress toward a balanced budget.” He suggested that council members hire a city manager “more in tune with your approach to municipal finance.”

The move comes two weeks after Cosentini, who had been employed by the city for less than a year, warned council members that they needed to take “immediate corrective action” or the city would not be able to make payroll or pay its bills by the end of the year. He asked council members to call a special meeting at that time, but they did not.

The council did meet last week but has not yet cut the budget.

Councilman Frank Gomez lamented that his fellow council members had not heeded Cosentini’s calls to action, saying in a written statement that they are either “in denial” or “lacked the conviction to do anything to solve the problems.”

But Mayor Art Barajas said council members take the budget very seriously and are carefully studying what steps to take. He said it was unfortunate that Cosentini had decided to step down.

In an interview, Cosentini said he would stay on for up to 30 days, which would give the council time to find a replacement.

Montebello has been riding waves of financial upheaval this year. Officials discovered two “off the books” bank accounts that contained hundreds of thousands of dollars in city funds that officials had lost track of.

Prosecutors in Los Angeles County Dist. Atty. Steve Cooley’s Public Integrity Division have said they are looking into what happened with those funds. In addition, the federal Department of Housing and Urban Development has asked the city to return more than $1.3 million that the agency says was improperly spent.

Cosentini also informed council members last month that former city officials had used accounting tricks to hide the true nature of the city’s financial picture for years, making it seem as though the city had more money than it actually did.

jessica.garrison@latimes.com