Federal relief dollars, new taxes, and emergency fund raids aren’t financial stewardship — they’re passing the buck.
In the September 2025 City Manager’s report, El Cerrito highlighted what it framed as good news: S&P Global Ratings raised the City’s bond ratings to A+ and A-, with a positive outlook for future upgrades. This was presented as a validation of stronger financial policies and fiscal sustainability.
However, while the headlines sound promising, the report omits critical details.
A Surplus Built on Federal Aid and New Taxes
The reported $1.6 million “surplus” is not the result of careful stewardship—it came after the City reduced the emergency fund to cover overexpenditures, using money meant for true crises to plug holes in the operating budget.
What’s more, much of the reserves the City points to came from one-time ARPA funds. El Cerrito was allocated about $6.2 million in federal relief, with the first tranche—roughly $3.1 million—received in FY 2020-21. Those dollars were meant to stabilize during the pandemic, but here they’ve been used to cover ongoing overspending.
On top of that, the City’s financial coffers were bolstered by yet another tax—the real property transfer tax—which began in 2018. Rather than demonstrating financial savvy, this is simply passing the buck to taxpayers to solve the City’s own mismanagement.
So essentially ALL of the unrestricted general fund balance was achieved, not by financial discipline but on the backs of others. Looking ahead, Uncle Joe won’t bail us out, and the RPTT isn’t likely to increase revenue soon. It’s time for the city council to walk the talk and become financially healthy by reducing expenses and not relying on taxpayers to bail them out -again.
Reserves Already Projected to Slip Below Policy
The September 2025 report also notes that the City’s reserves, celebrated as healthy today, are expected to fall below the City’s own minimum policy threshold by FY 26/27. That means the financial cushion they keep pointing to is shrinking fast, and future budgets will start from a weaker position.
Kicking Bills Into the Next Year
Adding to the concern, the City Manager has already acknowledged that expenses not paid last year will need to be addressed this year. That means the “surplus” story is even thinner—the City is deferring costs while claiming progress.
A House of Cards Budget
Taken together, this approach begins to resemble a house of cards: propping up today’s numbers with one-time federal dollars, deferred expenses, and new taxes, while presenting a picture of financial health that doesn’t match reality.
Even the bond rating itself reflects data from months ago—before the most recent financial moves. Since then, the City has drawn on funds that weaken the very financial cushion that made those ratings possible. Celebrating outdated metrics without acknowledging today’s reality risks misleading the public about the City’s actual fiscal condition.
What’s Missing: Services for Residents
Even more troubling, the September 2025 report says little about how these supposed “fiscal wins” translate into services that matter: safer streets, better parks, senior programs, or a library residents can count on. Metrics are important, but they don’t improve lives on their own.
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Tell the City to Share the Whole Story
El Cerrito residents deserve the whole picture — not just the high points. A bond rating upgrade may look good on paper, but it doesn’t erase the reality of emergency-fund use, deferred expenses, and reliance on one-time federal dollars and new taxes.
It’s time for transparency. Write to the City Manager and demand that future reports tell the full story — not just the highlights. Ask her to explain clearly:
- How much of the “surplus” came from one-time funds (e.g., ARPA).
- Why was the emergency fund used to cover overexpenditures?
- What services residents can actually expect in return for the taxes they pay.
And don’t stop there. Share your concerns with the City Council — they are accountable to you.
📧 City Manager Karen Pinkos (direct): kpinkos@el-cerrito.gov
📧 City Manager’s Office (general): citymanager@el-cerrito.gov
📧 City Council (via City Clerk for distribution): cityclerk@ci.el-cerrito.ca.us
Suggested subject: “Please report the full fiscal picture — not just bond ratings”
Suggested message:
Hello Ms. Pinkos and City Council,
Thank you for the September 2025 report. Please provide residents with a complete and current fiscal picture, including:
• how much of the FY surplus came from one-time funds (e.g., ARPA),
• any use of the emergency fund to cover over-expenditures,
• deferred expenses being carried into this year, and
• how these choices will affect services residents rely on (streets, parks, seniors, library).
Bond ratings matter, but residents need transparency about today’s numbers and service impacts.
Thank you.
El Cerrito Committee for Responsible Government (ECCRG) 