Redwood City approves next budget

Although the city anticipates longer term structural deficits over the next decade, the upcoming fiscal year is financially stable. The council approved the balanced budget, which includes establishing an “economic stability reserve” on top of its 15% reserve, as a precautionary measure. 

The economic stability reserve was adopted at $2.8 million set aside, down from the staff’s initial proposal of $4.8 million. Councilmembers requested that $2 million instead go to increased investments in the road repaving and rehabilitation program. 

City roads are currently rated a score lower than desirable, staff reported at the budget study session earlier this month, and councilmembers agreed to dedicate more money toward bringing road quality up for both public safety and cost reductions in the long run. 

The business license tax fee passed by voters in November 2024 will be a new source of significant revenue for the city, and will in large part go toward staffing. In fiscal year 2025-26, the tax will generate $3.9 million. 

“What this money is going to enable us to do is bring staffing up to levels where we can start taking care of a lot of business in Redwood City that hasn’t been done in some time,” Councilmember Diane Howard said. 

The fiscal year 2025-26 budget includes 26.6 full-time equivalent positions added to support city operations. Twelve of the positions were previously funded by grants or one-time funding sources that are being converted to ongoing permanent positions. 

“It is noteworthy and wonderful that we are improving our ability to provide services to the community,” Vice Mayor Kaia Eakin said. 

The city’s five-year capital improvement plan is a particular pressure point in the city’s budgeting. There is an estimated $243 million shortfall in revenue compared to all projects identified in the five-year plan. 

For the five-year capital improvement plan, 43% of the planned funding will be dedicated toward transportation projects which includes street and bike safety improvements.

Councilmember Chris Sturken attempted to tack on “just $5,000” from the city’s reserves to fund a pilot “Speak Up” program with the nonprofit Communities Overcoming Relationship Abuse, stating he had previously requested it to be funded and felt it had been ignored. 

Sturken noted that domestic violence incidents increase when the economy is uncertain and the city is already seeing a rise in inter-partner violence. In December 2024, a woman died following a domestic violence incident in Redwood City.

Councilmembers felt a more formal process to allocate funding toward programs addressing domestic violence was necessary, before dedicating the money. Instead, the council will hold a study session on how its Human Services Financial Assistance awards are allocated. 

The Redwood City Council approved the budget as recommended unanimously.