Redwood City VOICE
Published in

Redwood City VOICE

Redwood City’s Fiscal Year 2017–2018 Adopted Budget

An in depth look at the City’s adopted operating and capital budgets

Recently, the City Council adopted the FY 2017–18 Operating Budget and Capital Improvement Program (CIP). This week’s blog provides an in depth look at the City’s adopted operating budget and features upcoming, major Capital projects funded through the CIP.

The Adopted Budget addresses the City Council’s strategic priorities and policy direction on fiscal sustainability by relying on ongoing revenue to fund ongoing expenses, using one-time revenues for one-time expenses, maintaining adequate reserves, and addressing long-term liabilities. It is also informed by community feedback generated from the Redwood City Conversations process, where nearly 300 residents and business owners took part in one of eight events to discuss the City’s future.

As we look to FY 2017–18, the City’s fiscal situation is projected to be positive, however, the City faces upcoming challenges. Addressing long term liabilities reduces our capacity to expand programs and services in the near term.

City Council Strategic Plan

Originally adopted in 2009, Redwood City’s Strategic Plan provides enduring statements of the critical and ongoing work of the City to accomplish the mission of “Building a Great Community Together”. Under Council direction, the Strategic Plan has evolved over time and in 2016 the Council added Housing as a strategic initiative. The Plan’s seven initiatives ensure department objectives align with the City Council’s vision. The adopted strategic initiatives are community building and communication, community for all ages, economic development, government operations, housing, public safety and transportation.

Adopted Budget

The FY 2017–18 Adopted Budget for all funds totals $ 267.2 million in revenues and $272.7 million in expenditures. Each fund is described in detail in the budget document. This blog focuses on the General Fund and Capital Improvement Program. The General Fund portion of the budget which funds public safety, parks and recreation, library and administrative services is $131.6 million. Most of the City’s General Fund revenues continue to derive from property, sales, Utility User Tax (UUT), and transient occupancy taxes (TOT) or hotel taxes. Enterprise funds, such as sewer and water funds, are dedicated to providing only those services and are funded by service charges. These funds are used to account for the provision of water, recycled water, and sewer services to the residents of Redwood City and some residents of areas adjacent to the City. In prioritizing the long-term fiscal sustainability of the City, the Adopted Budget has been developed using limited, primarily one-time increases to departments, and maintains a General Fund reserve of 15 percent.

Highlights of the FY 2017–18 General Fund revenues are detailed below:

• Property tax revenues are budgeted at $47.7 million. This is a 2.8% ($1.4 million) increase over the FY 2016–17 adjusted budget of $46.3 million.

• Sales tax revenues are expected to be flat, and are budgeted at the same levels as the FY 2016–17 adjusted budget of $23.1 million.

• Utility User Tax revenue is expected to increase by 2.4 percent over the FY 2016–17 adjusted budget of $9.5 million. This revenue is used for capital projects.

• Transient Occupancy Tax (TOT) revenue is expected to increase by 3.0 percent annually, primarily due to new receipts which will be collected by the new Courtyard Marriott hotel, which opened this spring.

Featured City Programs and Services

The FY 2017–18 Adopted Budget includes full funding for each department based upon current service levels and actual expenses over the last few years. Highlights of citywide goals for FY 2017–18 include:

  • Library and Parks: complete the Fair Oaks Library expansion within its current location; start construction on the Magical Bridge playground at Red Morton Park; and finalize the Downtown Park Feasibility Study
  • Community Engagement: introduce a new Neighborhood Watch model and support citywide National Night Out community events
  • Economic Development: expand business outreach programs and develop strategies to support small and locally-owned businesses and explore opportunities for new retail businesses to locate in Redwood City
  • Affordable Housing: adopt new housing policies to preserve existing affordable housing, increase the affordable housing production and reduce displacement of residents and execute the Bradford Street affordable housing project Disposition and Development Agreement (DDA) with MidPen Housing for the transfer of land and development of affordable housing for seniors, a childcare center and a public park along Redwood Creek
  • Public Safety: purchase four fire engines and maintain active leadership of Project SAFE to address blight and public safety concerns at Sequoia Station and the adjacent transit hub
  • Transportation: complete the Citywide Transportation Plan and use recommendations to guide funding decisions in the annual and five-Year Capital Improvement Program and design and identify funding for the Highway 101/84 Interchange Reconstruction Project

For more information and details about all citywide goals planned, go here and scroll to the Strategic Initiatives and Goals section.

• The budget also includes one-time expenditures to support a pilot Park Ranger Program at Stulsaft Park ($60,000) and firefighter Spanish-language training program ($19,000).

The FY 2017–18 General Fund expenditure budget is $117.8 million, which is $3.5 million, or 3.0 percent, more than the FY 2016–17 adjusted General Fund expenditure budget of $114.3 million. Salaries, wages, and benefits are $87.0 million, or 73.8 percent, of the General Fund expenditure budget. The Police and Fire Department salaries and benefits, as in most California cities, are a significant portion of the budget, amounting to approximately $57.1 million, or 65.6 percent, of all salaries, wages, and benefits in the General Fund.

Focus on Financial Sustainability

The Adopted Budget was developed with a specific focus on maintaining the long-term fiscal health of the City. Over the next few years, the City faces significant fiscal challenges driven by costs related to pension and retiree medical liabilities, workers compensation and ending residential uses at Docktown Marina.

These costs will continue to have a substantial impact on existing resources. The City has taken numerous steps to address these obligations, and this work will continue in FY 2018–19. Recent actions by the City Council include establishing a trust to help pay for the increased pension costs, increasing development-related fees and maintaining healthy reserves. City departments are focused on collaborating and implementing efficient processes, as well as looking at ways to reduce costs and maximize revenue. All of these actions allow us to chart a course for a sustainable and sound future so that we can continue to serve our community and meet the City Council’s highest priorities.

In light of these future funding challenges, the City Council approved a budget strategy for FY 2018–19 to reduce operating expenses by $6 million and increase revenues by $6 million.

Adopted Capital Improvement Program (CIP)

The FY 2017–18 CIP budget includes 59 projects with an estimated cost of $38.3 million. In addition, there are $91 million in existing capital projects that are currently funded, including the development of a Magical Bridge Playground in Redwood City at Red Morton Park.

Funding for capital projects typically derives from many sources, with the Utility Users Tax the primary revenue source utilized for capital improvement projects. Most other funding sources are restricted to certain purposes and, in some cases, must be spent within a prescribed period. Dedicated revenue sources include park impact and park in-lieu fee funds, water capital projects and sewer capital project funds, transportation grants, traffic mitigation fees and Gas Tax revenues.

The figure below provides a breakdown of the total one year project funding by functional area.

Featured Major Capital Projects

A few projects are highlighted below. Full project descriptions are available in the CIP and community members can track the status of projects over the year, here.

Middlefield Road Improvements (Utility Undergrounding and Streetscaping)

This project will increase pedestrian and bicycle safety and mobility on Middlefield between Woodside and Main, by relocating overhead utility lines/poles underground and re-configuring the roadway to provide wider sidewalks, protected bicycle lanes, street trees, pedestrian lighting, benches, and green infrastructure, consistent with the City’s complete streets objectives.

Kennedy Safe Routes to School Project

This project will improve pedestrian and bicycle access to and from Kennedy Middle School by constructing high-priority, recommended improvements from a 2013 Walking and Bicycling Audit.

Roadway Pavement Management Program

This program addresses ongoing roadway pavement repair and replacement needs. The Roadway Management Program inventories, assesses, and tracks maintenance of the City’s roadways. Each year, streets are prepared for resurfacing with crack sealing and spot repairs before being resurfaced with an “overlay,” “cape seal,” or “slurry seal”. This year will include an overlay on Twin Dolphin Drive.

Veterans Memorial Senior Center — YMCA Project

Modernizing the Redwood City Veterans Memorial Senior Center and YMCA is a long-planned project that will enhance the community’s fitness, wellness, and recreational resources. Redwood City’s Department of Parks, Recreation and Community Services has completed studies that show the buildings are at maximum capacity and in need of major repairs and accessibility upgrades.

Synthetic Turf Replacement — Marlin and Sandpiper Fields

This project involves the replacement of high-use synthetic turf fields at Marlin and Sandpiper parks and will improve safety and aesthetics.

National Guard Armory ADA Improvements

The City is improving various aspects of the facility and grounds in exchange for usage. Projects include: accessibility improvements under the Americans with Disabilities Act (ADA), new paving of a dirt lot, repaving of existing crumbling lots, painting and landscaping.

Other key projects:

  • Sewer investments in the amount of $6.6M
  • Water investments in the amount of $3.6M
  • Bayfront Canal Project (Planning/Design/Construction)$3.3M
  • Downtown Library improvements totaling $100K

To review the City’s Adopted Operating Budget and the Five-Year Capital Improvement Program, go here.

--

--

--

Information & Perspectives from the City

Recommended from Medium

Q&A with Social Finance Board Member Karen Dynan

The Greatest Shift in Wealth in History

Prospects for Bilateral Trade, Investments and Collaboration with the Republic of Georgia

The Real Estate Market Report In Canada

Rate hikes send markets spinning as recession looms

This I learnt | 21st June 2022

“We’re not in Adam-Smith-Land anymore, Toto”

Millennials: It's Time We Start "Shorting" Ourselves

Get the Medium app

A button that says 'Download on the App Store', and if clicked it will lead you to the iOS App store
A button that says 'Get it on, Google Play', and if clicked it will lead you to the Google Play store
City of Redwood City

City of Redwood City

Official thoughts and communications from the heart of the Peninsula. “Climate Best by Government Test”.

More from Medium

How you can succeed better than Jeff Bezos and Elon Musk without being a billionaire

Why the super-wealthy are taking control of their own destinies

Why the super-wealthy are taking control of their own destinies

The Legalization of Psilocybin Is an Interesting Social Experiment