Cerritos City Council adopts reserve policy to enhance fiscal stability

The City of Cerritos is taking significant steps to enhance its financial stability and public trust, as discussed in the recent State of the City meeting. A key focus is on strategic goal number six, which aims to responsibly manage resources and improve fiscal transparency. The city has introduced a new reserve policy designed to bolster its long-term financial health by establishing formal reserve levels for the general fund and other essential funds.

During the meeting, city officials highlighted the challenges posed by a projected budget deficit for the fiscal year 2025-2026, where expenditures are expected to exceed revenues. This situation is influenced by broader economic factors, including high interest rates and a fluctuating political landscape in Washington, D.C. Notably, Cerritos only retains 1% of the 9.75% sales tax collected, alongside lower property tax revenues compared to neighboring cities.

To navigate these financial hurdles, the city council is committed to strong leadership and has been actively reviewing the budget, which encompasses an annual operating budget of approximately $128 million and a capital improvement program budget of $23 million. Through collaborative efforts, the council has identified over $2 million in cost savings and revenue enhancements.

A critical initiative discussed is the upcoming water rate study, prompted by the fact that water rates for Cerritos customers have remained unchanged for four years. This study aims to align water costs with industry standards and ensure the sustainability of the water delivery system.

In addition to financial matters, the city is prioritizing improved communication with residents. Mayor's weekly columns, a strong social media presence, and various publications aim to keep the community informed about city services and initiatives. Residents are encouraged to engage with the city through email subscriptions and other communication channels.

As Cerritos moves forward, the city council emphasizes the importance of community input in shaping solutions that foster a resilient and thriving environment for all residents and businesses. The commitment to thoughtful planning and fiscal stability is seen as essential for protecting vital services and preparing for future challenges.