Fiscal Responsibility

Responsible government starts with being honest about our financial challenges—and accountable for the choices we make to address them.

Monterey has a strong financial foundation, but we cannot take that foundation for granted.  While we adopted a balanced budget for the current fiscal year, we continue to face significant structural budget challenges in the years ahead.

As Mayor, I believe we need to address those challenges responsibly while protecting the services our residents depend on.

How We Got Here

Monterey's current fiscal challenge did not develop overnight, and it was not created by a single budget or a single Council.

For many years before I joined the City Council, Monterey used periods of stronger revenue to expand programs, provide services, and invest in facilities and infrastructure that helped make our community what it is today. Those investments have value, but they also created ongoing costs—employees to support programs, facilities to operate and maintain, and infrastructure that eventually needs to be repaired or replaced.

The challenge is that ongoing costs require ongoing revenue.

Even before I joined the Council in 2018, City financial documents were warning about structural deficits and the need to address aging infrastructure and deferred maintenance. The City's FY 2013–14 budget projected a structural deficit of approximately $2 million within five years (see page 18) and warned that a structural deficit would limit the City's ability to set aside funds for neglected facilities and infrastructure.

The following year's budget again projected a structural deficit (see page 8) and acknowledged that the City was not adequately funding the renewal of its facilities and infrastructure or its unfunded maintenance needs.

That history matters because we cannot solve a long-term structural problem by looking only at the current budget. We have to understand the full cost of the programs, services, facilities, and infrastructure we have accumulated over time—and make sure future decisions come with a sustainable plan to pay for them.

As Mayor, I am accountable for helping address the financial challenges we face today. I also believe it is important to be honest about how we got here: many of the programs, services, and infrastructure obligations we are managing today predate my service on the City Council.

Our responsibility now is to learn from that history and make sure we don't repeat the cycle.

A strong financial foundation

$42.8 million in historic city-wide reserves

Monterey currently has approximately $42.8 million in total City-wide reserve balances, including $38.4 million in General Fund reserves and reserves held in the City's Special Funds.

$4.6 million in salary savings

As part of balancing the current budget, the City froze or left vacant positions, generating approximately $4.6 million in salary savings.

Balanced budget

The City adopted a balanced budget for the current fiscal year while making difficult spending decisions to address the projected operating deficit.

Those decisions included using $3.5 million in Neighborhood and Community Improvement Program (NCIP) funding to help balance the budget, not funding General Fund contributions to the Capital Improvement Program (CIP) this fiscal year, and suspending the City's Special Event Support Program.

The challenge ahead

While the current budget is balanced, balancing one budget does not eliminate a structural imbalance.

Current projections show operating deficits continuing in future fiscal years. That means we cannot rely on one-time solutions, temporary savings, or favorable revenue years to solve a problem that is ongoing.

We need to make sure that when we create or expand a program, service, or facility, we are also thinking about how we will sustainably operate, maintain, and replace it over time.

That is how we avoid repeating the cycle.

The Roadmap to Resilience

I am working with City staff on The Roadmap to Resilience, which will bring residents, businesses, neighborhood associations, nonprofits, military installations, and other community stakeholders into the process.

This is not about simply cutting our way out of the problem. It is about making responsible choices about what we can sustain, where we should invest, where we can operate more efficiently, and how we build a stronger revenue base.

Fiscal responsibility isn't simply about cutting costs. It's about learning from the past, making thoughtful choices today, and ensuring Monterey can continue providing the services and maintaining the infrastructure our community depends on tomorrow.