Rohnert Park prioritizes maintaining services as revenues level off

Rohnert Park officials are proposing a fiscal year 2023-24 budget that largely keeps spending in check as revenues level off.

The move means the city won’t have to dip into savings or cut services to cover ongoing operating costs ― decisions other cities across the region are considering ― but it leaves less money for needed infrastructure improvements citywide.

City Manager Marcela Piedra said the goal of budget staff for the coming fiscal year, which starts July 1, is to maintain the current level of department funding to be able to maintain the services residents expect as the city sees sales and other tax streams flatten or dip.

It’s the first budget crafted under Piedra, who joined the city in January after being hired from El Centro, where she served as city manager for five years.

“With a flat revenue projection, we need to closely monitor our fiscal sustainability,” Piedra told the council during a recent budget preview. “We want to make sure we continue offering the services that our community is expecting and giving a little bit more to our departments to be able to enhance their services, but it is important that we are very prudent.”

Piedra and department heads provided the council with an overview May 9 of Rohnert Park’s general fund and went over special revenues and capital expenditures on May 23.

The City Council is expected to adopt a final budget on June 13.

The $54.8 million general fund, which pays for most salaries, benefits and other operational expenses, represents a 5.5% increase over the current year’s $49.8 million budget.

Given the impact of inflation, that increase is largely seen as a flat budget.

Sales tax revenue, the main source of local income, was forecast to be up just 3.8% to $15.9 million, while property taxes were expected to grow by about 18.8% to $12.8 million.

Lodging taxes are projected to see a slight dip of 0.01% to just under $4.5 million.

That comes after financial officials last year reporting revenues coming in stronger than projected with stimulus money still circulating in the local economy and tourism rebounding as the city came out of the pandemic.

Salaries and benefits represent the largest single expense at nearly 60% and Piedra said Rohnert Park was seeing an increase in payroll expenses similar to other cities.

The city has been able to balance those increases through cost saving measures to pay down pension and retiree health care liabilities over the past few years, among other efforts.

Costs for fuel and utilities have also gone up, she said.

City administrators received $4.4 million in requests from department heads to enhance services but budget officials recommended funding only $1.8 million in new programs.

The additional funding will help pay for new software to better manage public records, employee wellness programs, efforts to reignite economic development activities and equipment for police and fire.

The city is allocating $1 million from the general fund to initiate design services for needed repairs at city facilities, including City Hall, the senior center and the public works yard.

Beyond the general fund, expenditures from enterprise, special revenue and capital funds total $77 million.

The various funds will pay for more than $8.5 million in water and sewer infrastructure improvements, including the replacement of a waterline along Southwest Boulevard, road improvements, upgrades at city parks and upgrades to the dispatch communication center at the city’s Public Safety facility.

Piedra said in the coming years, the city will have to be mindful of its reliance on special revenue funds and grants to cover services and capital costs as some of that money may not be available in the future.

The city must also address infrastructure needs citywide and deferred maintenance at city facilities. An analysis of the health of 62 city facilities found there is an estimated $40 million in needed repairs but the city spends less than 1% annually on maintenance, she said.

You can reach Staff Writer Paulina Pineda at 707-521-5268 or paulina.pineda@pressdemocrat.com. On Twitter @paulinapineda22.