As Californians head to the polls, residents across the state, including those in El Cerrito, are being asked to consider a host of tax increases and new government bonds. These ballot measures aim to generate hundreds of millions in local revenue through new taxes and bonds, with over two dozen cities, counties, and school districts requesting taxpayer funds — despite not having published their 2024 financial statements. For El Cerrito, a city facing significant budgetary and accountability challenges, these decisions carry particular weight.
El Cerrito’s Financial Landscape
El Cerrito has faced scrutiny in recent years for its financial management practices. Residents are familiar with issues related to transparency, as the city has occasionally struggled with timely financial reporting and addressing structural budget shortfalls. we called attention to the city’s challenges in keeping up with best practices for municipal financial reporting, highlighting the importance of updated and accurate audits.
As El Cerrito residents are asked to support new taxes, and continue existing taxes, we face the pressing question: How can they make an informed decision without clear insight into the city’s fiscal health? For many, the lack of a current Annual Comprehensive Financial Report (ACFR) raises concerns about how taxpayer funds are allocated and whether El Cerrito can afford additional debt or increased spending commitments.
The Accountability Gap: Missing ACFRs Across California
El Cerrito’s situation is not unique. Many California municipalities, counties, and school districts are seeking new funds without presenting updated financial information. Each year, local governments are required to publish an ACFR, which offers insight into their revenues, expenditures, assets, liabilities, and overall fiscal activities. However, this year, numerous local entities, including Humboldt County and the City of Woodland, have yet to release these reports. Without an up-to-date ACFR, taxpayers lack the information necessary to gauge whether their local government is effectively managing existing resources before requesting more.
For El Cerrito residents, the question of financial transparency is especially pressing as past state auditor reports have indicated areas of concern, including rising pension obligations, underfunded city services, and challenges with balancing the budget. These issues echo broader concerns across California, where municipal debt has surged to almost $1.6 trillion. In El Cerrito, as in other cities, increased taxes or bonds could act as a stopgap for more profound, underlying financial concerns.
Key Questions for El Cerrito Voters
El Cerrito voters considering tax measures should ask the following:
1. What is El Cerrito’s current financial position? Understanding where the city stands financially is crucial. Are revenues in line with expenses? How are public funds being spent?
2. Is the latest financial report available? If El Cerrito has not published its 2024 ACFR, residents should question whether approving new taxes is responsible without seeing a clear fiscal picture.
3. What other options exist for revenue generation? Are there alternatives to taxing residents further, such as selling or leasing city-owned property, reallocating funds, or improving efficiency?
4. How much debt does El Cerrito already carry, and what is the city’s debt management strategy? What is the city’s long-term plan to handle outstanding obligations like pensions, which are a known burden on El Cerrito’s budget?
5. How will additional taxes impact residents? El Cerrito residents, especially those on fixed incomes or from low-income households, could feel the impact of increased taxes. How is the city addressing these concerns?
Transparency and Accountability in El Cerrito
Given El Cerrito’s ongoing financial hurdles, transparency in government spending is essential to regain public trust. The California Policy Center’s resources, such as the Municipal Finance Triage Guide and Local Fiscal Health Dashboard, can be invaluable for residents to independently evaluate El Cerrito’s fiscal health.
Conclusion: Informed Voting in El Cerrito
While addressing local needs through taxes and bonds can be necessary, sustainable budgeting requires transparency and accountability. El Cerrito residents deserve a full understanding of how their tax dollars are being used and the current financial health of their city before agreeing to new financial commitments. Without an updated ACFR, it becomes challenging for El Cerrito’s citizens to gauge whether their local government is responsibly handling their money. As voters head to the polls, they should demand transparency and prudent financial management from their elected officials to ensure El Cerrito is set up for long-term fiscal health.
Learn more in the California Policy Center’s article: Should Voters Approve New Taxes Without Seeing the Books?
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El Cerrito Committee for Responsible Government (ECCRG) 
El Cerrito City Council is counting on Prop 5 passing that lowers the percentage from 2/3 percent of voter approved bonds for affordable housing and infrastructure to 55% of voter approval. That way EC can pass a supplemental property tax for the City’s proposed $21,000,000 bond offering for the apartment project located in the TOD building on the corner of Liberty and Fairmont. This would be tantamount to a “grant” to the City and housing developer since the bond repayment comes from the supplemental property tax assessment and cannot be secured by any way other than property taxes (that’s the law). No cash flow from the apartment complex rents can be used to repay the bond. In effect EC property taxpayers would be giving the City $21,000,000 to be co developers and co owners of the 240 unit apartment building and lease the library space to themselves. This is free money and counts as “equity” that will lower the amount of leverage to make the return on for investors. Why? I don’t want the City to own and operate an apartment complex with my tax dollars! EC owns a library now and with much less complexity replace the library at its current location for a fraction of the cost to build and MAINTAIN a 240 unit apartment complex which when the bond is repaid then the City begins to collect rent. But William Ktsanes with his background in finance understands this and that is why I am voting for him.
On Mon, Oct 28, 2024 at 9:50 AM El Cerrito Committee for Responsib
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