No Budget Solutions in Sight for Richmond as Deadline Draws Near


By:

blogimage.jpgRichmond faces a stark financial realty as the deadline for next year’s budget approval rapidly approaches.

City Manager Bill Lindsay is still in the process of preparing the final budget proposal, which must be approved by the City Council on or by the Council’s June 3rd meeting. As Mr. Lindsay pointed out at a recent City Council meeting, Richmond’s finances are in dire straits going into the upcoming fiscal year.

The City’s reserve bank account has already had to absorb the brunt of a $7 million deficit this past year. It had faced a $9.6 million shortfall in revenue as a result of devaluation of the City’s assessed value itself (the only municipality to see a such a drop in the entirety of Contra Costa County) that led to lower property tax revenue, and reduced revenues from utility use taxes. To make up this difference, city leadership made some cuts and went into its reserves. This took the balance of that reserve account below the mandated level of seven percent of the operating budget.

As the city faces these serious financial concerns, the rapidly approaching June 1 deadline is increasing the gravity of this situation. The City Manager must now create a budget that attempts to mitigate the budget shortfall and also starts to rebuild the reserve account that was depleted last year. And he must do all of this and submit a final draft proposal to the City Council in early May, according to the city’s “Budget Development Process.” Then the rules indicate the City Council must hold a study session with the City Manager to suggest final amendments to the proposal, which must then be incorporated and brought back to the Council for approval at the first meeting in June.

Mr. Lindsay and his staff have already stated publicly that they will not have a final draft ready for the Council until mid- to late-May, and possibly even later. If you look at the Council’s meeting schedule for May, you discover that the the earliest date on which the Council will have a chance to hold a study session with Mr. Lindsay and his staff is May 20th. Assuming there are suggested amendments – and there almost certainly will be several due to the contentiousness of the issues at hand and the cantankerous attitudes of the council members toward one another – the City Manager will have a maximum of two weeks to rework the budget proposal and get it back to the Council for approval. In the meantime, the public and the citizens of Richmond will have no chance to see the final plan before it is brought to the Council on June 3rd and brought up for a vote.

So, the city needs a budget proposal that finds $10 million in spending cuts for the next fiscal year or locates an equally lucrative source of untapped tax revenues to balance the budget. What does that mean? It likely that this budget proposal will determine whether or not a large number of city employees get the axe in the new fiscal year.

Currently, the various departments that Mr. Lindsay oversees have been able to cut almost $3.2 million from expenditures, but that is just a drop in the bucket. One possible solution that many have discussed is to allow the Chevron modernization project to move forward as soon as possible. They argue that investment in the refinery will lead to huge tax revenues, which would allow the City to more easily balance its books. This seems like an unlikely scenario give the animosity that some members of the council have towards Chevron.

With stakes this high, many members of the public are raising concerns about whether will be time for public review and engagement of the city budget before the council must approve it. Many residents who work for the City are worried that they may lose their jobs without so much as a chance to speak about it at the bi-weekly Council meeting.

Be the first to comment

Please check your e-mail for a link to activate your account.
    Fight your California speeding ticket and win here. Fight your red light camera ticket here. Fight your cell phone ticket here.