Novato ‘state of the city’ event focuses on budget deficit
The city is projecting a $2.6 million deficit for the current fiscal year, nearly $1 million more than forecast when the budget was adopted in July.
Novato is planning a survey and workshops in order to address its multi-million-dollar budget deficit.
City officials and the Novato Chamber of Commerce held the annual “state of the city” event on Tuesday with Amy Cunningham, the interim city manager. While much of the meeting was a review of notable policies and programs over the past year, the budget was a special focus.
The city is projecting a $2.6 million deficit for the current fiscal year, an increase from the adopted budget in July, which projected a $1.7 million shortfall. The city is projecting $47.9 million in revenue and $50.6 million in expenses.
Cunningham said the shortfall is partly because of one-time funds the city no longer has access to for services and capital improvement programs.
“Without significant service cuts, it will grow again next year,” she said.
Cunningham said officials plan to hold a budget workshop on Thursday. Other study sessions and workshops are being planned before the budget adoption meeting on June 25.
The city is also circulating a new budget survey to gauge public sentiment on important services. The survey will help official evaluate options for cost reductions and revenue.
“We’ll work through the challenges together, find new solutions as a community, as we always do,” Cunningham said.
The city is operating with 14 fewer employees than five years ago, Cunningham said.
She said one of the issues is that Novato’s property tax distribution from the county is 7%, the lowest in Marin, and the city only receives only 1.25% of its 8% sales tax.
Cunningham said the city is considering placing a sales tax increase on the ballot. It could raise up to $10 million a year, she said.
Coy Smith, the chief executive officer of the Novato Chamber of Commerce, said the meeting was intended to educate and inform the public, thus inviting participation in city programs. About 50 people attended.
“We don’t do this event for prestige,” he said. “We don’t do this event for profitability.”
In other developments over the previous year, the City Council heard 125 resolutions, received 226 staff reports and made 64 proclamations and recognitions for community members.
The city also made 30 full-time hires, including Nick Nguyen as public works director, Jim Naugle as police chief and Clare Hartman as community development director.
In the area of housing, Cunningham said the city is working to revise its housing element draft after receiving direction from the state. The revised draft will likely be approved in the spring, she said.
“This plan will guide our future efforts to provide needed housing in the community,” she said.
The state has mandated that Novato facilitate the creation of 2,090 new homes through 2031 while also “affirmatively furthering fair housing.” The city’s housing element has projected approximately 2,400 dwellings during the period.
The city has a host of new housing projects in the pipeline, including at the Village of Novato, at 777 San Marin Drive, at 7711 Redwood Blvd. and at the Hamilton Village development.
On the homelessness issue, Cunningham said 22 people have been transitioned into housing.
Cunningham also touted the reopening of Pioneer Park, which has additional recreational features as well as disability access enhancements.
“The project exemplifies what we can achieve when we all come together,” she said. “It really shows who we are in Novato.”