Redwood City Poised to Allocate One-time Balance of $12.1 Million to Meet Unprecedented Community Needs

On Monday, February 22, 2021, the Redwood City City Council will receive a Fiscal Year 2019–20 Year-End Budget update and Fiscal Year 2020–21 Mid-Year Budget update, as well as a proposed framework for the development of the Fiscal Year 2021–22 budget.

Current Financial Status and Outlook

“The City Council’s conservative financial practices allow the City to support the community during this unprecedented economic downturn and make progress on long-term goals,” said City Manager Melissa Stevenson Diaz. “Additionally, voter support for Measure RR in 2018 has provided essential ongoing revenue to sustain community services.”

While we ended last fiscal year with a $12.1 million operating balance, or savings available for spending, this is $1.1 million more than we thought in October. The savings resulted from both underspending and higher-than-projected revenue. Under the leadership of the City Council and the direction of the City Manager, we continue efforts to limit City spending.

Use of One-Time Funds

The City Manager is recommending to the City Council that $7.5 million of the $12.1 million operating balance beheld aside to address a projected $7.5 million budget deficit next year. This will help us work toward financially sustainable operating models. It’s also recommended that the remaining $4.6 million be used for pandemic response and recovery, to help us with reimagining City services, and to address long-term community needs. This includes:

  • Enabling community vaccinations;
  • Employee COVID-19 testing;
  • Supporting Citywide pandemic costs;
  • A one-time utility bill forgiveness program;
  • Additional small business support;
  • Funding to enhance communications and diversity, equity and inclusion initiatives; and
  • Increased resources for homelessness services.

The recommendation also includes partial funding for planning studies related to improving Redwood Shores levees and the potential creation of a Bayfront Park in the Inner Harbor Area.

Developing Next Year’s Budget

“The City has prioritized support for vulnerable residents and our business community during the pandemic,” noted Stevenson Diaz. “We are responding with urgency, creativity and compassion. At the same time, we are proactively addressing long-term needs, including paying off pension liabilities at an accelerated rate to save taxpayers approximately $38 million.”

Staff is recommending the following timeline for the development of the FY 2021–22 Budget; all dates are public meetings of the full City Council and members of the public may participate:

  • April 12, 2021 — Capital Improvement Program Study Session
  • April 29, 2021 — Community Development Block Grant/HOME Grant Study Session
  • June 14, 2021 — Formal Budget Submittal at City Council Study Session
  • June 28, 2021 — Budget Public Hearing and Adoption June 28, 2021

Join the Conversation

  • For web, visit, select “Join” and enter Meeting ID 994 8182 5639. Use the Raise Hand feature to request to speak. You may rename your profile if you wish to remain anonymous.
  • For dial-in comments, call *67 (669) 900–6833 (your phone number will appear on the live broadcast if *67 is not dialed prior to the phone number), enter Meeting ID 994 8182 5639 and press *9 to request to speak.

Written public comment may be submitting by emailing the City Council at Please indicate the corresponding agenda item 8.A. in the subject line of your email.

To view the full staff report with recommendations, click here. To view the City Council agenda, click here.

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