Bring up the budget hearings of the Sonoma City Council with an average resident of Sonoma and their eyes glaze over. Hundreds of pages long, few people have the time or interest to wade through charts and tables filled with columns of numbers. And yet, the City budget is the foundation of everything the City does.
The budget is divided into segments, such as the General Fund, the Capital Improvement Fund, the Management Information Services Fund. There are special funds, like the Cemetery and Water Funds, and Reserve Funds. Each of these, and other funds, are based on their own set of assumptions, history and projections. So too, the history of expenses and revenues are examined, as are future projections. Payroll comprises the lion’s share of city costs, as do its related expenses, such as pensions and benefits.
Typically, a budget workshop offers a glimpse into the specific line items that contribute to departmental budgets, and the opportunity for the City Council and members of the public to ask questions and voice concerns. It’s an enormous amount of information, and the planned budget workshop offered May 27 is expected to last a good seven hours.
The City has a temporary Finance Director, and its interim City Manager has just started her job with the City. Hopefully, they have a firm enough handle on things to facilitate a productive meeting. But the financial challenges facing the City of Sonoma are major.
In order to balance its budget, an increase in the local sales tax was proposed and approved by the City’s voters. This action solved a major budget deficit of nearly $3 million, but that’s just a stopgap approach. The conditions that created that deficit remain.
The cost of government increases every year. Non-management employees are represented by a union that predictably presses for salary and benefit increases during every negotiation. While City revenue sources remain stable, they are not increasing at the rate of expenses, and the traditional ways small cities have planned on expanding their revenues are not as reliable as they once were. The business and work environments have changed tremendously.
Retailing is challenged by online shopping. Tourism is challenged by a shift in wine consumption. Employment is challenged by remote work. Gasoline prices are at an all-time high, increasing the cost of nearly everything, from groceries to hard goods. For local businesses that need employees, the price of housing is a major problem; attracting employees requires that there’s housing for them they can afford. This is true for City government, too. Less than 20 percent of City government employees live within the City of Sonoma.
Unless the City finds a way to significantly restructure itself, it will be back in a budget deficit within just a couple of years. It’s neither realistic nor fair to keep raising the sales tax; the lowest income residents bear the brunt of such increases. In the absence of dramatically increasing revenues, a decrease in expenses is the only answer. Consolidation, outsourcing, or joint powers agreements may provide solutions, or layoffs may be required. Something’s gotta give.
The City budget looks complex, but it’s not that different from a family household budget. Money comes in and money goes out. Nearly everyone understands that, so go to the budget workshop and bring your experience to the meeting.
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