At 46, City Manager Mike Flad has been serving the city of Burbank for half his life — but this week, he said he’s ready for a new challenge.

Next month, he’ll be heading 20 miles south to serve as the city manager of South Gate, a 7-square-mile working-class town of 95,000 nestled between Lynwood and Cudahy.

“The timing’s right for a change,” Flad said this week.

In looking for a change, he probably won’t be disappointed.

South Gate is a poorer city than Burbank, operating on a $35-million General Fund budget, compared to Burbank’s $149 million budget.

U.S. Census estimates released this week show South Gate’s 2011 median household income at $37,385, compared to $64,147 in Burbank.

And while Burbank isn’t immune to economic recession — unemployment rates reached 8.4% last year in Burbank — South Gate was hit harder, with jobless rates reaching 17.2%.

In 2011, 15.7% of the South Gate population received food stamps, compared to just 3.6% in Burbank.

In South Gate’s 2012-13 fiscal year budget, General Fund expenditures exceeded revenues by $2.1 million. The dissolution of redevelopment agencies cost the city $1.2 million and, according to current South Gate City Manager George Troxcil, will be “an on-going struggle for years to come.”

To balance the budget, the city froze hiring despite vacant positions, reduced maintenance costs and put off capital improvements. Still, projections show a negative fund balance in the middle of fiscal year 2013-14.

But Flad said the two cities do have some similarities. Burbank has gone from being a leader in the manufacturing industry to a media and retail hub, and South Gate is undergoing a similar transition.

The city used to be a highly industrial area, but over the last several years, major employers including U.S. Gypsum and HON Furniture — which together accounted for more than 500 jobs — moved out.

Last week, however, marked the beginning of construction on an $80-million, 370,000-square-foot shopping center on the corner of Firestone Boulevard and Atlantic Avenue. The idea is that a bustling commercial development will allow residents to contribute to the local economy instead of leaving the city to shop.

“I think South Gate is looking for the focus of their transition,” Flad said, adding, “I think that I can bring my skill set to help them with their visioning for the future.”

In addition to budget woes, the city’s internal operations have seen turmoil in recent years. In 2007, a group of South Gate police officers sued the city claiming racial discrimination and won a $10.4-million jury verdict.

Those issues are a familiar territory for Flad, who over the past several years has been dealing with similar legal actions filed by current and former Burbank police officers claiming racial discrimination and sexual harassment.

But whatever the similarities between the two cities, the disparity was conspicuously wide for many in Burbank, including members of the City Council.

“There are a lot of differences between South Gate and Burbank,” said Burbank Councilman David Gordon, when discussing Flad’s departure. “You have to step away and ask yourself the question, ‘Why?’ Because I honestly don’t know.”

Joshua Cox contributed reporting.

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