El Cerrito’s S&P Credit Review Raises More Questions Than Answers

Standard & Poor’s recently included El Cerrito on its U.S. Public Finance Annual Reviews Processed list—a standard part of S&P’s yearly routine for all rated entities. On the surface, this seems uneventful. The notice clearly states that this is not a rating action and only signals the completion of a routine review. So, why does it matter?

Because what’s not being said may be just as important as what is.

If the city were anticipating good news—an upgrade or even a positive outlook—it’s likely we would have already heard about it. Municipalities often move quickly to tout improved ratings as evidence of sound fiscal management. The silence from El Cerrito suggests that no such announcement is coming.

What the Review Means—and Doesn’t Mean

The S&P review does not automatically lead to a change in rating. However, if S&P analysts see red flags in a city’s financials, operations, or economic forecast, they can escalate the case to their credit committee. This process typically takes place 2 to 6 weeks after the initial review and precedes any public change in rating or outlook. The city is usually notified in advance, giving officials time to provide clarifying information or context.

So far, there’s been no word from City Hall. Not a press release, not a mention at council meetings. But what we do see is a rush to add funding to the Section 115 hoping this will ease concerns about the CALPers pension expenses.

Why It Matters

El Cerrito continues to operate under a BBB credit rating—barely above junk. The city’s fiscal challenges are well-documented: repeated operating deficits, mounting pension costs, and a persistent reliance on reserves. If the S&P review results in a downgrade or even a revised outlook to “negative,” the consequences could be significant:

Higher borrowing costs for capital projects Further erosion of public trust in city management Tighter budget constraints that force hard choices on services

Is This Normal?

Yes—being reviewed is normal. But not communicating during a time of scrutiny is not a good look. When other cities receive upgrades or reaffirmations, they usually don’t miss the chance to make it known. El Cerrito’s silence is telling.

What to Watch

Will S&P escalate El Cerrito’s file for credit committee review? Will the city address the review publicly before S&P acts? What steps, if any, is the city taking to mitigate risk and strengthen its financial position?

A Call for Transparency

Residents deserve more than last-minute disclosures. Transparency isn’t just about reporting outcomes—it’s about keeping the public informed when stakes are high. The city should proactively brief the community on the outcome of the review, including any actions being taken to strengthen its financial standing.

Don’t wait for a ratings downgrade to start paying attention. Demand answers now. Ask the city to share what they know and what they’re doing.

👉 Email the council and city manager

👉 Stay informed—your tax dollars and city services are on the line