There’s good news and bad news for the city’s budget for 2011-2012. In the positive column, the city’s credit ratings remains strong, there’s money in the bank—$10 million in general fund reserves, essentially a rainy day fund—and funding for the city’s services will for the most part remain intact. The bad news is that every part of city government will experience cuts of some kind, while programs that rely on state funding are under threat of a drastically constricted state budget, and part of the city’s budget relies on ballot measures, which are risky.
Last week, Jim Goins, the city’s finance director, and City Manager Bill Lindsay presented the budget to Richmond Annex residents at a budget meeting held at the neighborhood senior center. The meeting was the last in a series held by the city’s budget team to help explain the details of the budget to interested residents. The meeting was packed, better attended than most neighborhood council meetings, and people were lively but respectful, even when they did not like what they were being told.
People at the meeting took the opportunity to question Bill Lindsay and other city officials. Some of their questions were neighborhood-specific—largely about the restoration of Carlson Boulevard, which has been torn up for over a year—but a lot of the questions were not new to Lindsay. “We’ve heard a lot of the same questions in other neighborhoods,” he said, and the focus is often on public works and public safety. For the most part, attendees were concerned that the budget cuts would take police off the streets, or cut down on improvement projects throughout the city.
Nationally, things are improving after the lows reached during the 2008 economic meltdown. Over the last year, consumer spending has been up for the last year and a half, and unemployment is trending slowly downward. California is seeing it’s best job gain since 2007, and Governor Jerry Brown recently announced that the state budget gap is $10 billion dollars less than anticipated, though it is still severe and if voters do not approve new taxes, the state will be making drastic cuts.
But according to the budget Jim Goins presented at last week’s meeting, in Richmond, things are mixed. Foreclosures are down by just over 30 percent from last year, but remain significantly higher than the state foreclosure rate, which has roughly every 1 in 240 homes engaged in some part of foreclosure process, according to RealtyTrac.com. Unemployment, which soared between 2008 and 2010 has leveled off over the last year and is inching down, although it still dwarfs the national rate. In April, the city’s unemployment rate was 16.6 percent, compared to a county-wide 10.3 percent.
The city’s port and a deal over utility taxes with Chevron provide a welcome boon to the city’s budget said Goins. Chevron agreed last year to a fifteen-year increased utility bill, which will add $10 million to the city’s bottom line this year. At the port, Honda and Subaru have signed deals to offload their vehicles in Richmond. Honda’s contract will bring up to $120 million dollars over the next 15 years, and Subaru’s five-year agreement will net the city about $1 million annually.