Sebastopol council to turn its attention to growing deficit

Sebastopol’s projected budget deficit has grown to nearly $3 million and will be the focus of the city’s next council meeting.

“The City of Sebastopol has serious financial problems,” the staff report to the City Council said. “Staff project an ongoing deficit of $2.9 million/year without adjustments.”

The council declared a fiscal emergency last November. At that time the city was facing a $1.67 million general fund deficit and projected to run out of reserves in three years.

New City Manager Don Schwartz told The Press Democrat Friday that the city expects the deficit this year may be smaller than projected — perhaps $1.1 million — largely due to savings achieved through freezing empty staff positions.

But, he said, the latest analysis — by the accounting consultancy Baker Tilly — shows the city looking at a $2 million deficit next year, if costs aren’t lowered, and an average $2.9 million a year deficit over the next 10 years.

That deficit, he said, includes spending $900,000 a year on maintaining city assets excluding streets but including parks, buildings, technology and the vehicle fleet.

“We’re now counting things that really ought to be counted,“ Schwartz said. ”The financial viability of a city includes proper maintenance of your assets and that was not factored into prior projections.“

A split council in November declared the city to be in a fiscal emergency. Council members Sandra Maurer, who sits on the council’s budget subcommittee, and Jill McLewis had opposed the move, saying prior projections had not panned out.

One staff suggestion to cut costs is to discontinue community grants, which support a variety of local institutions. The Sebastopol Area Senior Center and the city’s Community Cultural Center have spent the week rallying their members against that move.

Tuesday’s meeting is at 6 p.m. on Zoom and in person at the Sebastopol Youth Annex, 425 Morris St. Agendas for the meeting can be accessed online at https://www.cityofsebastopol.gov/your-government/city-meeting-calendar/.

You can reach Staff Writer Jeremy Hay at 707-387-2960 or jeremy.hay@pressdemocrat.com. On X (Twitter) @jeremyhay