If you tuned into this week’s City Council meeting, you probably noticed something unusual — the financial presentation actually made sense. That’s thanks to Claire Coleman, who walked through the First Quarter General Fund update with calm confidence. No reading word-for-word from a script. No jargon marathon. Just a clear explanation of where we stand and what we should expect. That alone makes her stand out. In most departments, the department head presents directly to the Council. Finance works a little differently, and the contrast to the department head’s communication style is hard to miss.
First Quarter Results: “It’s Early” — but a Few Things Are Already Showing
Claire reminded everyone that first-quarter numbers don’t tell much of a story. Our revenues are notoriously cyclical, and Q1 is usually the quietest quarter of the year. Still, we’re tracking close to where we were last year — with one significant difference: salaries are up about 5%. The long-term impacts of negotiated raises are definitely starting to show.
Revenues: Timing, Cycles, and a Few Surprises
Property Tax
Almost no property tax money shows up until December. That’s just how the County schedules payments.
Sales Tax
Sales tax always arrives a couple months late because of state processing. So the “drop” we saw in Q1 isn’t a real drop at all — just a delayed payment.
Licenses & Permits
We’re on budget but lower than last year. That’s mostly because permit activity is unpredictable. One big project can completely reshape this category, and a large one may be coming soon.
Fines & Forfeitures
Higher than last year, mostly due to more police citation activity.
Use of Money & Property
Much higher because the Section 115 Pension Trust is now producing investment returns that didn’t show up in last year’s first quarter.
Charges for Services
Lower because Recreation only ran nine weeks of summer camp instead of ten. Fewer weeks = fewer fees, but also fewer staffing and supply costs.
Spending: Salary Growth Front and Center
Even though most spending is pacing close to last year, salary costs are up about 5%. This isn’t a one-time jump — it’s the ongoing effect of earlier contract increases. And because salaries influence overtime rates, pension contributions, and benefits, these increases compound over time. It’s one of the most significant budget pressures this year.
A Clarification the City Didn’t Make: Normal Cost vs. UAL
There was one moment in the discussion that deserves clarification.
Councilmember Motoyama asked whether the City had made payments toward the Unfunded Accrued Liability (UAL). Claire responded that the City made payments “in advance.” That sounds reassuring — but it’s not accurate in the way most people would interpret it.
El Cerrito has not made advance payments on the UAL.
What the City did instead was make advance payments on the “normal cost” — the portion of pension costs that funds the benefits employees earn this year. That’s standard, predictable, and ~$9 million of the annual budget.
But the UAL is something different entirely.
In CalPERS terms:
- Normal Cost
The yearly cost of benefits employees earn this year. It’s paid through employer and employee contributions. - Unfunded Accrued Liability (UAL)
This is the long-term shortfall — the amount owed because past investment returns didn’t meet CalPERS’ assumptions. It’s driven heavily by safety employees (police and fire), but it includes all City staff. The UAL is the debt the City still needs to pay down over time. - The question was about the UAL, but the answer addressed only the normal cost.
We recognize that Claire may not have wanted to contradict the councilmember, but that is not the same thing—and residents deserve a clear explanation of the difference. Paying the normal cost early does not reduce the pension debt. It simply pays this year’s bill a little faster.
Why Q1 Doesn’t Tell the Whole Story
Q1 is always the calmest quarter, which is why it rarely gives us the whole picture. Significant revenue comes later, overtime is unpredictable, and program fees rise and fall with the seasons. Mid-year is when the numbers start telling the truth about how healthy — or strained — the City’s budget really is.
Why These Decisions Matter: Our Reserves Are the City’s Safety Net
One thing that’s easy to miss in all the financial talk is how little cushion the City has. El Cerrito’s unrestricted reserves — basically the portion of the General Fund we can actually use — are already pretty limited. According to the City’s own First Quarter Budget Update, the General Fund balance is projected at about $23.9 million. But that number doesn’t mean what it sounds like. Here’s the breakdown: $11 million of that is restricted or already committed (Emergency Disaster Relief Fund, Section 115 Pension Trust, non-spendable items, etc.). That leaves about $12.8 million in true discretionary reserves. And only $3.6 million above the City’s minimum reserve requirement.
That’s not much breathing room for a city of this size — mainly because none of the pool-related costs are included in that $3.6 million cushion. The pool project — with significant capital and long-term operating costs — sits completely outside the reserve calculation Claire presented. These are the same dollars that help El Cerrito: keep essential services running if the economy slows, respond to emergencies or disasters, cover cash flow gaps when revenues are delayed, and absorb unexpected costs without sliding back into financial trouble. Every time the City draws from what’s left of this cushion, we shrink our margin of safety — and with rising labor costs, volatile revenues, and significant projects looming, that margin matters more than ever.
Growing Concern: Pool Costs Keep Shifting
In recent meetings, the public was shown two possible approaches to fixing the aging Emery G. Weed, III Lap Pool: a straightforward “replaster-only” repair estimated at under $400,000, or a full rehabilitation costing around $3.5 million. Based on those figures, residents could reasonably expect a clear decision and a predictable path forward.
Instead, we’re now looking at a $970,000 estimated cost just for design-related services and preliminary work — more than double the amount discussed for the basic repair itself.
According to the staff report, the City proposes awarding a $220,000 contract to Rogers Stringer & McClelland, Inc. (RSM) for design services. But once accessibility upgrades, electric vehicle infrastructure, and other add-ons are included, the “initial phase” alone climbs to nearly $1 million with full rehabilitation at $3.5 million. This is a significant shift from what residents were told initially. It raises an obvious question:
What exactly is included in each cost estimate, and how do these new numbers relate to the earlier repair options?
At this point, it’s also important to note that the City has already gone out to bid for pool work. And given that the lower-cost repair option has now been widely publicized, it is unlikely that any bid will come in below the numbers the City itself has announced. Once a publicly established price floor is set, contractors rarely underbid it.
This only reinforces the need for a transparent, consistent explanation of what the City is trying to build — and how much it will ultimately cost.
What El Cerrito’s Reserves Really Look Like
Projected General Fund Balance: $23.9 million
But here’s what’s actually usable:
• $11.0M – Restricted or already committed
• $12.8M – True unrestricted reserves
• $3.6M – Amount above the City’s minimum reserve requirement
And importantly:
• Pool project costs are not included in this reserve cushion. What the reserves protect the City from:
• Economic downturns
• Cash-flow delays
• Unexpected cost spikes
• Future fiscal instability
Bottom line: Our actual safety net is far smaller than the headline number suggests — and major projects like the pool aren’t included in that cushion at all.
Clear Communication Matters — and Claire Set the Standard
What stood out more than any chart or table was how the information was shared. Claire explained everything in a way that regular residents could follow. She didn’t hide behind complex terminology. She didn’t read from a script. She didn’t talk in circles. For a city that has struggled with public trust — especially around finances — this level of clarity isn’t just nice to have; it’s essential. If El Cerrito wants residents to believe in its financial recovery, this is the kind of honest, straightforward communication we should expect every time.
Why Residents Should Stay Engaged
Even with limited Q1 data, a few things are already clear: salary costs are rising faster than other revenues, permit revenue may hinge on a single large project, citation activity is up, and the City still hasn’t shared its assumptions around vacancy savings. These are exactly the kinds of trends that deserve close attention as the year goes on.
A Model for How Financial Reporting Should Be Done
If the City wants to demonstrate transparency, this presentation is a strong example of making progress. Clear. No drama. Some confusion, but an improvement. Exactly what residents deserve — and precisely what builds trust in a city still working to stabilize its financial footing.
El Cerrito Committee for Responsible Government (ECCRG) 