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City of Davis Fails to Meet Model County Standards for Budget Management

By Elaine Roberts Musser

The County Board of Supervisors has set for itself a series of excellent budgeting principles they are following in a very responsible way.  Below in italics are the ones most applicable to the City of Davis budget.  What follows are comments under each sensible standard briefly explaining how our City Council is faring.

“The budget should be structurally balanced…” With the adoption of the new two year budget cycle, the City’s General Fund expenditures will have exceeded revenues for 5 years in a row, which is just not fiscally sustainable.

“Ongoing expenditures should not be funded by one-time or non-recurring revenue sources.” American Rescue Plan funds were used to create new programs, with no discernible plan on how to continue funding them once the money dried up, other than new taxes.  Citizens don’t have money trees growing in their collective backyards to fund continual demands for new taxes every time the City runs out of money.

“Reserves… shall be funded at levels consistent with best practices…” The General Fund reserve is about 11%, $4 million dollars short of the city’s target of 15%. So what happens if there is another fiscal emergency?

“The… budget will…prepare to address any potential funding impacts from the [state and] Federal government.” It does not appear the City Council or City Staff have prepared for contingencies in case state and federal funding is dramatically decreased. We all know a drastic decrease is coming after the U.S. Congress passed the “Big Beautiful Bill”, or as I like to call it, the “Big Bad Betrayal”.

“…new position requests that increase net county cost will be reviewed critically, while recognizing that resources are unlikely to be able to accommodate growth.” Despite the budget’s dismal outlook, the City Council decided to approve new city staff positions the city could ill afford with money they don’t have.

“Departments shall… provide performance measures…” Performance measures? What performance measures? Where? We haven’t seen any!

“Budget reductions should provide for immediate stabilization in the short term, while creating the time and opportunity to make strategic decisions for addressing structural budget deficiencies in the longer term.” Dan Carson and I had urged the City Council to begin working on fixing the City’s financial mess as soon as they returned from vacation in Sept. Instead they have put off any action on the issue until March of next year, too late to achieve any solutions in the current budget year.  And it’s not at all clear the Council will even take any action to find funding to fix our roads and bike paths, or to pay down the growing unfunded liability for employee health benefits.

“Transparency.” The public was not informed as to how bad the City’s budget picture was – until after the City negotiated new contracts with the City employee bargaining groups. Those expensive deals left no money to fulfill the promises made to the voters to put the City on a fiscally sustainable path, an egregious bait and switch.

“Budget reductions should focus on preservation of …services and programs…” City Council members continually speak of creating new programs or expanding existing ones, when it can’t even provide basic services such as pavement management.

“Recognition and maintenance of appropriate levels of administration and support to ensure that…programs and services can be effectively carried out is critical.” Measure Q was the recent sales tax increase approved by voters.  Measure Q funds were spent on employee salary increases, instead of other city needs as promised in the ballot language. As a direct result, there is a shortfall of funding needed to fix pavement, parks, city buildings and other City infrastructure.  Shockingly, that deficit is projected to be $265 million over the next 20 years. 

If a report card on the City’s fiscal situation were issued, in my opinion the City would fail in every single category.  I would highly encourage the City Council to adopt some basic budgeting policies similar to the County’s principles.  I suspect it would keep the City Council on a better fiscal track, instead of constantly going off the rails.

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Comments

19 responses to “City of Davis Fails to Meet Model County Standards for Budget Management”

  1. David McGlocklin

    It is obvious the city council’s agenda is inconsistent with meeting City of Davis needs. Their ears must be tuned to different music.

    Reply
  2. Ron O

    In all honesty (and not in disagreement with anything put forth), I suspect that Davis will somehow survive.
    But social justice warriors (like the ones that Davis elected) are usually the ones leading in the wrong direction in regard to fiscal responsibility (and some other issues that I won’t go into, here).
    And yet, Davis keeps electing them. Voters did have a choice, regarding some of the candidates at least. Matt Williams and Colin Walsh come to mind.

    Reply
  3. Donna Provenza

    Thank you Elaine, the mismanagement of the city budget is clear to anyone who looks deep enough. What a huge disappointment. Makes me wonder what is going to happen next. I have little confidence that this situation will improve.

    Reply
  4. Alan C. Miller

    RO say: “I suspect that Davis will somehow survive.”
    Survive, yes. But with pavement like lower Berkeley, where there are roads designated as bike paths that you literally cannot bike on – the pavement is shattered. Is that the price of social justice warrior town? We pay for the downtrodden to live hear, and they break their back wiping out on a pavement crack along with the rest of us? Now THAT is what I call “Equity”
    RO say: “Voters did have a choice, regarding some of the candidates at least. Matt Williams and Colin Walsh come to mind.”
    Many names come to mind. All of whom are too sane to run for City Council.

    Reply
  5. Alan C. Miller

    “Ongoing expenditures should not be funded by one-time or non-recurring revenue sources.” American Rescue Plan funds were used to create new programs, with no discernible plan on how to continue funding them once the money dried up, other than new taxes.”
    Amen! Amen! Amen!
    Every time the Council cavalierly paid for some “want to have” out of Biden Money I cringed. What are they thinking – this is free money? Look what that ‘free money’ did to the entire national economy in terms of inflation, which is nothing but a regressive tax that most impacts those with low income.

    Reply
  6. Roberta L. Millstein

    And now, we’re talking about a new skate park, even though the roads and bike paths to get there are crap??
    https://www.davisenterprise.com/news/community-meeting-set-for-wednesday-to-discuss-new-skate-park/article_830b0863-ed92-48f9-b394-b4d9dca20af9.html

    Reply
  7. Ron O

    Alan M. says: “Survive, yes. But with pavement like lower Berkeley, where there are roads designated as bike paths that you literally cannot bike on – the pavement is shattered. Is that the price of social justice warrior town?”
    That’s impossible. Berkeley is wealthier than Davis, and collects a lot more taxes. Plus, it has THE pre-eminent UC in Northern California, which is within city limits. Therefore, the city “obviously” exercises some control over it (and doesn’t just “do UC Berkeley’s bidding”).
    I’m (also) absolutely certain that Berkeley has no crime problem (e.g., from neighboring Oakland or Richmond).
    And last time I checked – it had no confusing traffic problem in regard to that multi-lane (not sure how many at this point), climate-saving I-80 maze that runs though the city. They are, after all – even more opposed to that kind of thing than Davis is.
    Next thing you’ll be telling me is that some place like San Francisco (even wealthier than Berkeley) has been mismanaged in much the same way.

    Reply
  8. Alan Lorax Hirsch

    This is all so sad.
    A city so rich Human capital has been unable to marshall these advantages into a sustainable financial plan that balance revenue and expenses.
    A place where people will spent an extra $200k to live vs woodland has wasted these advantages. Our schools are now threatened.. and reality building affordable apartment home which city has focused done wont fix financial problems even if it will finally bolster school enrollment in 5,years to save our schools.
    This problem transcends one set of council leader which is why long time permanent city manager MiKe Webb seems suspect.
    Webb proved his short term thinking in beggered tree budget – over citizen objections— a move that that kill a woman in slide hill park by neglected pruning— and caused our annual insurance previous to more than double, exacerbating budget shortfall.
    That Webb now runs Yolo county should cause concern.
    However long term this is a problem of collective in Davis- a cultural problem of how we do/do not collaborate in making civic decisions.
    As part of “city hall crowd” since 2012 I am part of collective dynamic that created this mess. But damn if I know the path – and my role – to change the culture and get us out of it.

    Reply
  9. Roberta L. Millstein

    What has happened to Davis?
    Setting aside the details and looking at the big picture, I’d say that we have had a series of councilmembers who have been more interested in flash than in substance, who make poor financial choices in favor of what we want over what we need, for whatever looks good in a headline. You could count on these councilmembers to show up at any event where there were photo and speech opportunities, but for hard decisions they were awol.
    And the Council has let staff run its own agenda over the commissions and over what Davis citizens need. There has been an explicit move not to “interfere” with staff, many of who have disdain for Davis and Davisites.
    To be clear, this has been a closed circle of people, with “new” people being ordained by previous ones, and most Davisites too checked out to know what’s really going on, so they go with name recognition. (The background here is the lack of real reporting combined with the splintering of people’s attention across social media, so that even when you have a good article, a lot of people won’t see it). People outside of that circle have very little chance of breaking in, and who wants the time and frustration and money and personal attacks of fruitlessly running for office? Very few. (And to be clear — not me — not even if the circumstances were better. I am not cut out for public office and not interested, so this isn’t sour grapes on my part).
    So, how do we fix that? Some people who are really charismatic, willing to pound the pavement, willing to put up with everything, dedicated to the City and citizens and citizen input, need to run for council. Oh, but stupid district elections. Well, we are stuck with those for now.
    So, who wants the job?

    Reply
  10. Ron O

    In response to Alan H’s comment (duplicated in the Vanguard), I’ll duplicate my response, here:
    Alan H says: “A place where people will spent an extra $200k to live vs woodland has wasted these advantages. Our schools are now threatened.. and reality building affordable apartment home which city has focused done wont fix financial problems even if it will finally bolster school enrollment in 5 years to save our schools.”
    “Some” people will spend $200K (or more) to live in Davis (rather than Woodland). Most young families (who move to the area) won’t – but they’ll still send their kids to Davis schools – without paying DJUSD parcel taxes. Some of them actually work for the school district, itself.
    The district already knows that (even) poaching students from Woodland isn’t going to prevent a school closure. (Probably because Woodland residents age-out of the system, just as everyone else does.) Though there will be another 1,600 housing units at the Woodland technology park – the one that “moved” from the location in Davis that’s now being paved-over for Bretton Woods. (DJUSD’s poaching activities are likely giving WJUSD a “reason” to not build another school at the technology park – despite what a determined group of parents in Woodland have been pushing for.)
    But “who cares” about the impact that DJUSD’s poaching activities have on Woodland’s school district anyway, right?
    In any case, Davis’ school system is too large in regard to the needs of the community – even when accounting for its poaching of Woodland students. That’s an entirely different issue than suggesting that it’s “threatened” as a whole. I’m surprised that you’re apparently confused regarding the difference.
    There are, no doubt, quality school districts that are smaller than Davis’ school district.

    Reply
  11. Alan Hirsch

    Thanks Ron O and Roberta M for thoughful response… how do we get beyond blame-game?

    Reply
  12. Roberta L. Millstein

    Alan, re-read, or read, the last two paragraphs of what I wrote.

    Reply
  13. Alan C. Miller

    I’ll offer a thoughtless response: let’s continue the blame game, so people get blamed.

    Reply
  14. Alan Hirsch

    Roberta
    Culture is more than a few better people on council— but ethos and unwritten rules of how we interact- we is not just council but you and I commissioners, and enterprise/vanguard and groups like Phoenix coalition.
    Example of Davis culture: when Gloria Phoenix coalition holds its “unity rallies” it typically excludes churches and business community.
    .cultures and their supporting Structures can get above —or below – average out of average humans actors … and on average we will
    Have average commissioner and council folk.
    The old commission structure failed us here — I have theorized in op-eds it was with the way Mike Web had his staff strangled it with Brown act over regulation – but current council decided problem was people- too many of them — and insufficient regulation.
    Time will tell if this improve commission effectiveness, but one thing is ckear council top down imposition of this reforms did not increase collaboration or inclusion or shift from end long blame game to feeling we are all created this mess together- and we all have to change to fix it.
    We need an away to end zero sum blame game and instead move a culture to better collaborate…city staff actually work with interested and concerned citizens pro-actively BEFORE thing go to council … not just field 2 minute public complaints after-fact ipublic hearing after the due us cast by staff — when issue already before council and staff NEVER admits a mistake.

    Reply
  15. Roberta L. Millstein

    Alan H, your example is very telling: Phoenix Coalition. That group has a lot of power/influence in town, yes, but even more so when Gloria is on the Council, and it increases the insularity of the circle that I talked about.
    Change starts from below, but ultimately it has to come from the top — here I refer to the finding of new candidates and the voting in of new candidates, respectively. And as I said already, a change in the way that the council interacts with staff — staff has too much power.
    As for attacking others, I will point out that you have publicly condemned other people who participated in city governance, both in public comments to the Council and in print. Maybe you want to collaborate now, but to be completely honest, I cannot fully collaborate with someone who has shown himself untrustworthy in the past. (and before you say, what, I don’t remember, I don’t know what you’re talking about — if you don’t, then that is exactly part of the problem).
    I mean, broadly I agree with you, but when you put things the way you did, then I have to shift to Alan M’s view: in order to fix things, we need to first place the blame where it belongs, and I place that with the last series of councils.

    Reply
  16. Alan C. Miller

    AH’s comment was all but unintelligible. I asked ChatGPT if it made sense and it said, “You’re absolutely right to be confused — the original post is very difficult to follow due to disjointed grammar, inconsistent punctuation, and a lack of clear structure.” I then asked ChatGPT to write a clear version that preserved the intent of the author:
    “Culture in Davis isn’t just shaped by a few good people on the City Council — it’s also defined by the broader ethos and unwritten rules that guide how we interact with each other. That includes not just the Council, but also commissioners, local media like the Enterprise and Vanguard, and organizations like the Phoenix Coalition.
    Take one example: when the Phoenix Coalition and Gloria hold their “unity rallies,” they often leave out churches and members of the business community. That reflects something about the culture of exclusion here.
    The systems that support our culture — including commissions — can either elevate or drag down the performance of the average person. And let’s face it, most commissioners and councilmembers are just average people.
    The old commission structure failed us. In past op-eds, I’ve suggested that one reason was how City Manager Mike Webb had his staff over-enforce the Brown Act, which strangled the commissions. But instead of addressing that, the current City Council blamed the people themselves — saying there were too many commissioners and not enough regulation.
    Maybe the new reforms will improve commission effectiveness, but one thing is already clear: this top-down approach from the Council hasn’t improved collaboration or made things more inclusive. It hasn’t helped us shift from a culture of finger-pointing to one of shared responsibility. We all contributed to the current mess — and we’ll all have to change if we want to fix it.
    What we need is a way to move beyond zero-sum blame games and toward a culture of true collaboration. That means City staff must work with concerned citizens proactively — before issues are brought to Council. Right now, the only public input happens after decisions are already made, in the form of rushed 2-minute comments during Council meetings. And staff almost never admits to making mistakes. That has to change.”
    My point is ChatGPT is your friend, and available to all. Use it. Everyone will understand the points you are trying to make.

    Reply
  17. Alan C. Miller

    RM say: “Change starts from below, but ultimately it has to come from the top — here I refer to the finding of new candidates and the voting in of new candidates, respectively.”
    I believe we are permanently screwed, thank to Max Rexrod. The majority of people in Davis are stupid, as in they don’t follow what’s really going on and vote by name recognition or who some inner-circler recommends who has name recognition. I don’t fully blame them for being stupid, it’s the human condition, and some have important things to prioritize such as survival and raising their families.
    But the district system in Davis will forever condemn us to the same inner circle. And there is zero incentive for the inner circle who has the power to change this dynamic, as it keeps them in power and the inner circle strong. Not only are the demographics of Davis fairly uniform, which makes the need and purpose for districts moot, but the stupidity is also fairly evenly distributed. Thus, stupid people will vote in the inner-circle in all districts, and second-tier candidates, who could win in a general election, lose in every stupid district.
    The only candidate to challenge the district system was Kelsey Fortune, and the inner-circle didn’t want her. She has shown her love of Davis, her ability to run a successful local business, and shows her caring by who her business benefits. And the scones are delicious. I hope she runs again someday and gains traction, which would require a less-stupid electorate. And then we’d have one person on the council who would be against the district system.
    The only other hope is that Max Rexrod has an unexpected encounter with Jesus and repents, devoting his life to reversing what he has brought down upon our fair city. As in a fair city being one step down from a good city, and way below a great city.

    Reply
  18. Roberta L. Millstein

    The lessons I took away after one of my miniature poodles was lost for 5 nights and days in the Berryessa wilderness last December (cold, rainy), only to emerge basically unharmed, was that 1) sometimes improbable things happen, 2) those of us who tend toward pessimism (like me) tend to act as though improbable good things won’t happen — but we’re not omniscient and it’s not more “realistic” to assume that the improbable good outcome won’t occur, and 3) it’s important to try to work towards those improbable good outcomes, and believing in their possibility is an important piece of that.
    So I’m not saying that it would be easy for good candidates to win (and I had already acknowledged that district elections make things harder), but I think it’s possible, worth acknowledging the possibility, and worth working towards it.
    I supported Kelsey but I think she ran during a period of her life when she was not able to give her campaign her full attention. Maybe we should work to make “getting rid of district elections” more of a council-election issue, something we can do even if we aren’t in the district in question.
    Now, who wants to step up to run, really run, for Davis City Council? (again, not me — I think I lack some of the requisite qualities)

    Reply
  19. Alan C. Miller

    Not me. I’m sane 😐

    Reply

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