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City auditor warns of large pension and capital shortfalls in Berkeley's financial condition audit
Summary
Berkeley's city auditor presented an April 2026 financial condition audit showing a structural general-fund deficit for FY27'FY28, about $695 million in net pension liabilities, and $1.8 billion in unfunded capital and deferred maintenance; staff agreed to report back on implementation of audit recommendations in a year.
The Berkeley city auditor and her team presented a financial condition audit to the City Council on April 28, highlighting long-term fiscal pressures that will affect upcoming budget deliberations. City Auditor Jenny Wong introduced performance audit manager Caitlin Palmer, who reviewed the report's key findings and recommendations.
"Overall, we found that Berkeley is facing ongoing challenges with its long term financial condition," Caitlin Palmer said, summarizing an audit that covers fiscal years 2016 through 2025 and that was adjusted for inflation. Palmer said the audit identified a structural general-fund deficit projected at about $30 million for fiscal years 2027 and 2028 and described multiple longer-term risks, including pension liabilities and deferred maintenance.
Palmer highlighted three headline figures: an estimated $695,000,000 net pension liability as of…
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