Santa Rosa braces for unprecedented budget increase after fires

Santa Rosa is proposing what is likely to be the single largest spending increase in its history as it grapples with the continued fallout of the October wildfires and struggles to rebuild.

City Manager Sean McGlynn and his finance team are preliminarily proposing an increase of $62 million - or 16 percent - in next year’s budget, easily the sharpest increase in city spending in a decade and possibly ever.

And, because it doesn’t have nearly that much of a revenue boost heading its way, the city’s general fund is expected to take a $14.4 million hit, depleting reserves and darkening what was already a bleak budget picture.

“Clearly we have some real challenges ahead,” Mayor Chris Coursey said.

The city has implemented a hiring freeze in an effort to get control of its budget, is searching far and wide for all manner of federal aid, and is planning polling to see what kind of new taxes residents might support, McGlynn and his finance chief, Alan Alton, told the council Tuesday.

McGlynn told the council the hiring freeze, which does not affect the City Attorney’s Office, was to save money as much to ensure the council has some leeway in the budget process only now getting underway in earnest.

“If we continue to hire, you won’t have any options,” McGlynn said. “Because we’re over our revenues, in terms of expenditures right now.”

The city is already on track to spend about ?$6 million more from its general fund than it expected this year, largely from fire-related expenses.

The overall city budget, which includes nongeneral fund departments such as water, is poised to increase 16 percent, from $385.3 million to $447.5 million. Much of that increase is expected to be needed for the replacement of a large section of the water system in Fountaingrove, where the dangerous hydrocarbon benzene, likely released from melting plastic pipes, was sucked back into the water mains.

That project alone has been estimated to cost upwards of $43 million.

The city is in the process of requesting reimbursement for its expenses from the Federal Emergency Management Agency.

An estimate from last week of $89 million was already obsolete by the time the Tuesday meeting, Alton said. The latest expense figure is closer to $111 million, he said.

The city has been racing to complete its calculations by Tuesday, and details of what went into the new figure were not immediately available, McGlynn said.

The outdated total included $8.5 million for debris removal, $7.3 million for emergency protective measures, $9.2 million for bridges and roads, ?$1.6 million for water control facilities, $5.9 million for buildings and equipment, and $7.6 million for recreation and parks.

The largest share - ?$53 million for utilities - included the Fountaingrove water system fixes, McGlynn said.

The city previously estimated it would need to cover at least $5.1 million of the expense total.

McGlynn said he expected city staff to be able to outline FEMA request in greater detail this week.

Under the circumstances, council members appeared poised to trim their wish lists.

Jack Tibbetts suggested a few ways city might be able to free up money for some fire recovery work. One was to pause the ongoing upgrade of city streetlights to LEDs, which he said might save $600,000.

He also proposed moving the costs of maintaining the dam at Lake Ralphine from the general fund, which is supported primarily by tax dollars, to Santa Rosa Water, which is supported by ratepayers. McGlynn said staff was “actively looking at it.”

Councilman Chris Rogers said he’d like to see if it would be possible to institute a council subcommittee looking at the implementation of the city’s Climate Action Plan. He noted that some elements of those plans were not being followed. Councilman Tom Schwedhelm said he wanted to see housing-first funds preserved to address homelessness and money set aside for a school resource officer for Roseland University Prep.

Following the meeting, Coursey cautioned against reading too much into the budget figures, noting that without clarity about the full extent of FEMA reimbursements, the true state of the city’s budget picture was still hazy.

“What I know is what we have a lot of work in front of us,” he said.

You can reach Staff Writer Kevin McCallum at 521-5207 or kevin.mccallum@pressdemocrat.com. ?On Twitter @srcitybeat.