#city financial loans
Richmond: Council renews city manager contract
Updated: 11/18/2015 06:12:17 PM PST
RICHMOND — Despite growing concerns about the city’s financial management and claims that transparency is lacking, elected leaders here have renewed the city manager’s contract.
The four-year contract was renewed Tuesday night in a 5-2 vote, with Councilmen Nat Bates and Vinay Pimpl opposed.
City Manager Bill Lindsay receives a base salary $270,572, making him one of the highest-paid city managers in the East Bay.
Lindsay’s contract will expire in 2020 and includes a 6 percent salary bump, tied to a number of financial goals. These include achieving a structurally balanced budget without laying off staff; shoring up reserves to 12 percent of the general fund; increasing the amount the city pays toward its pension liabilities; and finishing a community benefits agreement with the Berkeley Global Campus.
Lindsay came to Richmond in 2005 following a financial meltdown during which some 300 city employees were laid off. Since then, the city has attracted new businesses and shored up its reserves. But Richmond has been forced to fill budget gaps with one-time funds, and it faces $120 million in unfunded retiree health care costs, one of the reasons cited for Moody’s downgrade of the city’s credit rating.
Lindsay has been criticized for not being transparent about the city’s financial situation and not firing problematic department heads, including the director of the Richmond Housing Authority, even as the federal government began an inquiry into financial mismanagement and corruption at the agency.
“Bill is a nice guy, but he’s a softy,” Bates said Tuesday. “He has a problem managing employees and allows them to get away with things they shouldn’t.”
Among Bates’ concerns are Richmond’s dwindling reserves, use of a half-cent sales tax promised for road repairs to balance the budget, and the recent downgrading by credit-rating agency Moody’s to junk bond status.
“We used to have a $75 million surplus, and now we have $11 million,” Bates said, adding that the loss was prompted by the city’s efforts to pursue eminent domain to compel the sale of underwater mortgages so that residents could refinance their loans.
The plan ground to a halt when banks sued the city. Bates said this prompted credit-rating agencies to take a closer look at Richmond’s finances and “see what was going on under the covers.”
Pimpl was also critical of Lindsay’s leadership, especially the city manager’s failure to present a five-year plan to the council last year. A five-year plan is a financial-planning document that provides an analysis of a city’s current and projected finances. It’s not required but is considered good financial practice.
“The financial forecast not being placed on the agenda, especially in an election year, gives the appearance of improper behavior,” Pimpl said. “We don’t want to be like Wall Street guys where the highest-paid employees don’t have to compromise while people who earn a lot less do have to compromise.”
But council members Gayle McLaughlin and Jael Myrick, along with Mayor Tom Butt, defended Lindsay as a highly capable manager who is smart, hardworking and dedicated to the city.
“He’s made mistakes, but of all the issues we’re facing right now, the major one is the fiscal challenges,” Myrick said. “And we can’t right our financial ship if we’re also searching for someone to lead the city.”