SAN RAMON — Even though rising employee pension costs are expected to remain a spectre over this city as they are in many others, a new report says there are plenty of other reasons San Ramon should remain financially strong over the next several years.
This information comes from the city’s “Comprehensive Annual Financial Report” for the July 2016-to-June 2017 period. The report, compiled by the Pleasant Hill-based accounting firm Maze and Associates, was discussed by the City Council on Jan. 9.
The city’s Comprehensive Annual Financial Report for July 2016 to June 2017 says San Ramon has had good economic numbers, and suggests the city is positioned for them to get better. The city has a relatively high median household income level of $151,327, more than twice the state’s average of about $68,000; revenues from property taxes, property transfer taxes, transient occupancy taxes, franchise fees, and licenses and permits are all headed up; and median home values went up 4.1 percent during the 2016-17 fiscal year.
Even with $8.9 million more in pension liabilities during the than during the previous fiscal year, the city’s overall long-term liabilities, at $25.7 million during that 12-month period, went down by $2.1 million from the previous fiscal year, the report says, a reflection of the city paying off the debt faster than accumulating new debt. Also, the available general fund ending balance of $9.9 million turned out to be $2 million higher than estimated in the final city budget.
Total city revenues from July 2016 through June 2017 were $114.3 million, up from about $102 million the previous 12-month period (12 percent gain), according to the Maze and Associates report. Also, it reports the city’s overall expenses of about $96.5 million in 2016-17, up 5.3 percent from the previous year’s $91.67 million. That means the revenue increase of about $12.3 million more than offset the $4.83 million increase in expenses.
This report’s numbers figure to change in the next few years, and because of two primary factors. One is the anticipated mid- to late 2018 opening of the City Center project, its retail sales taxes expected to contribute substantially to the city’s bottom line.
The other, an elephant in the room, is unfunded employee pension liabilities. As have many California cities, San Ramon has struggled with this. About 200 current city employees and about 100 retirees are covered by CalPERS pensions. The $8.9 million deficit figure for 2016-17, the report said, figures to go up.
“We’re in better shape than a lot of public agencies, but I don’t know if that’s the standard you want to hold yourself to,” Councilman Phil O’Loane said. “That’s a low bar.”
Though O’Loane said he feels the city has done a good job in setting aside money wherever possible to help draw down the pension deficit, City Manager Joe Gorton said the city’s real work in this area is still ahead.
“All jurisdiction, including us, will have significant hits monetarily in regard to addressing these pensions,” Gorton said.
