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Carmel-by-the-Sea staff recap budget figures, warn of $34 million infrastructure shortfall
Summary
City staff previewed upcoming budget adoption hearings, summarized current revenue and spending figures and said recent studies show an estimated $34 million backlog in building, storm drain and pavement maintenance.
Staff member 2 said the City of Carmel-by-the-Sea will hold budget adoption hearings next week and reviewed the municipality’s recent revenue and spending figures.
"We have roughly $32,000,000 of operating expenses and about $8,000,000 of capital work planned," Staff member 2 said. "So that gets us to about a $40,000,000 budget this year." Staff member 2 also said the city’s three largest revenue sources total about $30,000,000 and that charges for services are about $3,000,000.
Staff member 1 reminded attendees that the city is required to adopt a balanced budget by the end of the fiscal year. "We are required to have a balanced budget by the end of our fiscal year, which is June 30," Staff member 1 said.
Why this matters: city leaders said these funds support routine services and capital work, and staff flagged deferred maintenance totals from recent studies. "For the studies that we have done, it's about $34,000,000 and that's for buildings, and our storm drain system and our pavement," Staff member 1 said, noting the figure does not explicitly reference staircases, revetments or seawalls that also require attention.
Background and context: Staff member 2 gave a brief historical comparison, saying projected revenue about 10 years earlier for the 2015–16 fiscal year was $18,600,000, roughly half current projections. Staff member 2 characterized revenue growth as occurring despite a reduced resident population over the same period.
Details and limitations: Staff member 2 described other revenue categories such as business licenses, vehicle license fees and franchise fees as collectively adding about $3,000,000. Staff member 1 and Staff member 2 emphasized that many user fees are intended to cover service costs rather than generate surplus. "We're not permitted to make money," Staff member 1 said.
Next steps: Staff signaled the council will consider the budget in upcoming meetings and that staff will present more detailed infrastructure condition information in the coming weeks. The discussion did not record a formal vote on the budget during this session.
Ending: Staff closed the discussion by reiterating the two-part purpose of the budget: to account for revenues and to fund services for residents and visitors to the village.
