News Room

City Council to consider Recommended Budget, including People’s Budget initiatives, at Study Session on June 13 and budget adoption on June 27

REDWOOD CITY, CALIF.— On Monday, June 13, the City Council will consider the Fiscal Year 2022-23 Recommended Budget as submitted by the City Manager. The Recommended Budget continues to advance the City Council’s top priorities of Housing, Transportation and Children and Youth, pandemic recovery, and vital community services.

The City has been able to withstand an $82 million revenue drop while avoiding layoffs and sharp service reductions because of its long-term commitment financial best practices. Despite using over $18 million in federal assistance and City reserves, in order to balance the budget, nine vacancies in multiple departments will continue to be held next year.

“We are approaching FY 2022-23 as a year of transition; we are not returning to business as usual, said City Manager Melissa Stevenson Diaz. “We remain committed to reimaging public services to adapt to new community needs and prepare for a changing future. I am optimistic we will make progress on increasing staffing next year and developing new revenue strategies to support City services and infrastructure needs.”

The Recommended Budget proposes to re-build staffing to pre-pandemic levels as City revenues increase, a process expected to take two years. In light of the City Council’s prioritization of housing for all in the community, the Recommended Budget increases Housing Division staff levels from two to four full-time, regular staff. Over the next six months, the City will study fire and police services, which together account for over 56% of General Fund expenditures, to assess service levels, best practices, and community needs. These studies and community input will inform future staffing recommendations.   

Due to revenue shortfalls caused by the pandemic recession and unfunded employee benefit liabilities, anticipated budget deficits could average $10.5 million per year for the next five years. While many factors could affect the specific deficit amount, it’s clear that new strategies to fund current services, new capital projects, and legacy costs are needed. In addition to deficit challenges in the operating budget, there is a $360 million shortfall in funding needed for the next five years of the City’s Capital Improvement Program, which funds public facilities and infrastructure.

“This fall, we will begin work with the City Council’s Finance and Audit Sub-Committee to develop a multi-year strategy for revenue enhancement to complement the reimagining work underway in all departments,” Stevenson Diaz said. “This includes examining City cost-recovery fees across all departments and reviewing the potential creation of improvement or assessment districts to recover the impact of growth in an equitable fashion. We may also need to consider bond issuances for capital investments.”

The Recommended Budget also includes four community-suggested projects which received top votes as part of the People’s Budget initiative: free showers for those experiencing homelessness in Redwood City; increased funding to implement housing initiatives; a 10-week youth peer mentorship program for drug and alcohol prevention; and funding for bike lanes on 3 blocks of El Camino Real between Maple Street and Wilson Street. Born out of community calls for more involvement in budgeting, the People’s Budget was a four-month public engagement process to solicit ideas on how to spend $1 million. Following intense outreach, nearly 1,800 community members voted on projects.

The Recommended Budget also continues the City’s COVID-19 financial and community recovery strategy – nicknamed the Three R’s (Respond. Restore. Reimagine.) It also includes taking important steps on climate action, anti-displacement strategies and applying an equity lens to strengthen the City’s commitment to diversity, equity and inclusion.

The FY 2022-23 Recommended Budget and Budget in Brief are available at www.RedwoodCity.org/Budget. For ways to participate (in-person or virtually) or provide written comment on the budget, visit www.RedwoodCity.org/CouncilMeetings.