Redwood City invites community input on regulating firearm retailers in city

Redwood City projects $11M budget deficit for FY 2022-23

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Redwood City is forecasting a deficit of more than $11 million for Fiscal Year 2022-23, the majority of which will be addressed by $9.24 million in federal pandemic assistance. But city officials say the return to pre-pandemic revenue levels is expected to take another three years, and they don’t expect to receive another round of federal pandemic assistance beyond FY 2022-23.

“The City will set-aside about $6.5 million in additional City funds for anticipated deficits resulting from the pandemic; however, more than $17 million in deficits over the next four years is currently projected,” city officials said.

Key drivers for the projected deficit “are shortfalls in sales and hotel taxes and rising costs to fund pension benefits for employees who have already retired and current employees,” officials said.

So far during the pandemic, the city has maintained vacancies to avoid layoffs and has managed to steer clear of abrupt disruptions to services. In fiscal year 2020-2021, a deficit led to reductions in all city departments. But for the current fiscal year, 2021-22, the city used $9.24 million in federal assistance to address a deficit and avoid drastic cuts. For 2022-23, the city plans to use a similar round of federal assistance along with $2.52 million in city reserves to address the deficit. But with federal assistance expected to end and future deficits projected, the city will need to find ways to adjust, officials said.

“We need to continue to lean into reimagining service delivery by studying service levels against best practices, leveraging technology, and applying an equity lens to City service delivery,” City Manager Melissa Stevenson Diaz said. “Many departments are stressed beyond capacity, especially as we continue to grapple with staffing constraints due to the pandemic. Looking ahead, we have to ensure we have the right staff, right services and right resources.”

The development of the FY 2022-23 budget will include four public hearings during City Council meetings, including March 24, (Capital Improvement Program Study Session Community Development Block Grant); May 9, (Community Development Block Grant/HOME Grant Study Session); June 13 (Formal Budget Submittal at City Council Study Session); and June 27 (Budget Public Hearing and Adoption).

For more information on budget projections, view staff documents here.