Tom Butt
  E-Mail Forum – 2022  
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  Richmond Ranks 10th in State for Financial Risk
October 18, 2022

The California State Auditor continued to list Richmond in the top 10 at-risk cities in the state in 2022, primarily because of its high pension obligations, which are rated as the highest in the state. See A high percentage of unfunded pension obligations is particularly worrisome because it results in high annual payments to CalPERS and less money to provide programs and services.

The only way to reduce these costs is to pay down the unfunded liability. Typically, such funds come from one-time revenue sources, such as the sale of surplus city property. The sale of the developable portions of Point Molate could have brought the City $22.5 million that could have been used to pay down unfunded pension obligations, but the RPA-controlled City Council sold it instead to a former casino developer and an Indian tribe for $400.00.

The naivety of the RPA City Council members in fiscal matters is a clear and present danger to the City of Richmond. Two of the four RPA City Council members have gone through personal bankruptcy. Personal bankruptcy is nothing be ashamed of, but it is not a salient qualification for running a City with a $200 million general fund.

In times of fiscal challenges, RPA City Council members have also strenuously resisted any layoffs, taking away an important tool for moderating fiscal stress.

If you want a fiscally sound City of Richmond, you do not want a City Council controlled by fiscally irresponsible RPA members.

There is one misleading piece of data in the Auditor’s report shown above. It shows the Richmond unemployment rate at 8%, when in fact it is 3.9%, as of August 2022.