AgdaPkt 2019-10-14 Joint SA PFA - Laserfiche WebLink

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6.A. - Page 59 of 114 The City projects its pension contribution costs will increase by a $19.5 million (106 percent) to $37.9 million by FY 2023-24 and by an additional $3.71 million (9.8 percent) to $41.63 million by FY 2027-28.470 Redwood City's projected pension contribution costs are included in its readily accessible FY 2018-19 budget and FY 2019-20 recommended budget.471 Financial Overview — Redwood City Redwood City faces significant fiscal challenges beginning in FY 2021-22 as substantial projected general fund surpluses in FY 2018-19, FY 2019-20 and FY 2020-21 are projected to turn into large and growing deficits (with an annual deficit of $0.945 million in FY 2022-23 rising to an annual deficit of $17.85 million in FY 2027-28) if significant expense reductions and/or revenue increases are not made.472 A major component of these looming deficits is rising pension costs.473 As part of its FY 2017-18 budget, the City adopted a "Financial Sustainability Plan" or "FSP" which includes reducing operating expenses and increasing revenue over the following five years. 474 Under the FSP, the City had included in its FY 2018-19 budget approximately $3.8 million in operating cost reductions. The City also obtained voter approval for new revenue enhancement measures in 2018 (described in the section entitled "Revenue Enhancement — Redwood City" below). Partly as a result of passage of these measures, the City restored $2.7 million of the planned $3.8 million in planned cost reductions, which included restoration of police department staffing and library hours. 475 Redwood City notes that, during FY 2019-20, "the City Council Finance/Audit Subcommittee will be discussing opportunities for the City to increase revenue, among other financial strategies" and that "[m]aintaining the City's long-term fiscal stability requires meaningful action and a proactive approach to addressing the City's projected deficit and long-term liabilities through both revenue increases and expenditure reductions over time."476 Additional Payments to Ca1PERS — Redwood City Redwood City has been evaluating the option of making additional annual payments to Ca1PERS beyond its Annual Required Contribution in order to reduce long-term pension 47' Redwood City, Recommended Budget Fiscal Year 2019-2020, pp. 26, 29 & 175. The graphs on pages 26 and 175 of this budget include contribution cost projections through FY 2038-39. A table on page 29 of the budget projects pension contribution costs through FY 2045-46. 47'Redwood City, Fiscal Year 2018-2019 Adopted Budget, p. 173. Redwood City, Recommended Budget Fiscal Year 2019-2020, pp. 26 & 175. 472 Ibid., pp. 166 &176. 473 Grand Jury interview. 474 Redwood City, Recommended Budget Fiscal Year 2019-2020, p. 16. 475 Ibid. 476 Ibid., p. 17. 2018-2019 San Mateo County Civil Grand Jury 52 63