10-Year Strategy for Stabilizing Budgets While Supporting Growth

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News Date: 
January 7, 2019

After a year of study and design work, the National Resource Network (NRN) and Salinas City staff have introduced the Salinas Plan to solve structural challenges in the City’s budget while maintaining City services and identifying additional initiatives to attack the City’s affordable housing crisis.

The Plan, prepared by the nonprofit National Resource Network in collaboration with City staff, emphasizes the strategic, long-term thinking required to meet the needs of a complex system like a City, as opposed to reactions to individual events. It was presented to the City Council at the Dec. 4 meeting.

While recognizing the promise of Salinas’s agtech economy, growing population, and rising home values, the Plan identifies two major challenges:

The City’s budget deficit is structural and so will need structural remedies. The deficit is “driven largely by sharp, state-mandated increases in pension costs, healthcare inflation for employee benefits, and limited revenue growth,” according to the Plan’s Executive Summary. If nothing is done, “Salinas faces growing deficits each year for the next 10 years.”
Salinas must have more affordable housing: “[the] housing crisis threatens community and economic health – and also adds to the City’s budget pressures with increased service demands and potential dampening of the private investment that helps to drive revenue growth.”

While the temptation is to address the symptoms of challenges, on a case-by-case basis, the Plan recognizes that systems have many moving parts that interact with each other, and so solutions must also be systems-based — strategic, rather than tactical.

The Plan identifies the following high-level goals for the City’s financial future: “balance the General Fund budget; free up the resources needed to invest in infrastructure; provide a stronger fiscal foundation for the future service of municipal employees; and position Salinas to take advantage of new Federal and State initiatives designed to create thousands of units of new affordable housing.”

To achieve them, the Plan works out the details of a multi-year framework based on the following principles:

  • A renewed focus on prioritized core services,
  • A series of management and productivity reforms,
  • Strategic rethinking of the City’s approach to employee compensation,
  • Game-changing investments in more affordable and safer housing, and
  • Increased commitment to basic infrastructure and deferred maintenance needs.