Rohnert Park Poised to Adopt 2011-'12 Budget

City Manager Gabe Gonzalez on Tuesday presented a draft budget for fiscal year 2011-2012, in which he reported Rohnert Park faces a $2.1 million operating budget deficit for the upcoming year, and a staggering annual structural deficit of $36.5 million.

That includes money the city should be setting aside for infrastructure improvements, such as roads and buildings, as well as retiree medical reserves, employee leave time, water and sewer and vehicle replacement.

Rohnert Park officials reported at the that city buildings are crumbling, infrastructure is deteriorating and employee benefits pose a significant threat to the city’s long-term financial stability.

The total unfunded liabilities for retiree medical alone is $53.2 million, and just $2.6 million has been set aside to date, according to Gonzalez. 

In addition to money the city should be setting aside annually, Rohnert Park has been pummeled by fallout from the Great Recession, including declining property values, a 9.8 percent unemployment rate countywide and growing commercial vacancies. Property tax dollars and values have declined precipitously since 2008, further crippling the local economy.

Without Measure E, sales tax figures would suffer as well. Gonzalez said Measure E generates about $2.4 million annually, but some of those taxes are one-time charges on equipment such as SmartMeters. He estimated Sales taxes will generate $85 million for the next fiscal year, or $600,000 higher than the current year.

In addition, every city-owned facility except the Callinan Sports and Fitness Center, lost money last year. The sports complex made $89,717 last year, but community events have cost Rohnert Park $20,861, the Community Center racked up $90,505 in debt, the Senior Center cost the city $71,714 and the cost a confounding $163,801 to maintain and keep open, according to Gonzalez’s report. Spreckels Performing Arts Center is expected to operate in the black next year because of a new advertising sign planned.

Gonzalez Tuesday highlighted some problems and solutions.

He said selling off valuable city properties, such as the Stadium Lands, has had a detrimental impact.

“In several prior years, the true state of the city’s finances was obscured by the selling off of city land assets to cover annual operational expenses,” he said in a news release. “Also, the city failed to recognize the long-term consequences of certain decisions and … failed to engage in longer-term financial planning…”

Gonzalez added that another blow to the budget is .

“Nonetheless, the progress is not all bleak,” he said in a statement. “In the past three years, we have made substantial progress in addressing some of these issues.”

Gonzalez pointed to a $7 million reduction in city spending over the last two and a half years, a reduction in city staff from 191 to 154 positions, a goal of setting aside monies for unfunded liabilities in a trust fund and setting up what he called innovative programs — such as a city nonprofit used for fundraising for community events.

The future of redevelopment agencies are still in flux as well, which if eliminated, could deal further strip local funding.

Stay tuned at Rohnert Park Patch next week, where the City Council is expected to vote on the proposed budget.