Richmond Mayor Tom Butt delivered his annual State of the City address to a crowd of about 50 people Tuesday night, and though it wasn’t quite as upbeat as Oakland Mayor Libby Schaaf’s recent “Moonshot” address, he did seem to have plenty of good news for the city, ranging from a historically low unemployment rate to a slew of five-star Yelp reviews for a local bed and breakfast.
Butt said RichmondWORKS, a city-run job placement program, helped 1,200 people find jobs over the last year, while the parallel YouthWORKS program found summer employment for 166 young people. Richmond’s unemployment rate, he said, stands at what Butt called a “remarkable” 4.6 percent, the lowest since the end of World War II.
The mayor also touted the fact that Richmond passed the first rent-control measure in California in 30 years. The measure establishes that Richmond rents (excluding single-family units and buildings built after 1996) must be frozen at mid-2015 levels, and landlords must have just cause for eviction. (While community advocates supported the measure, Butt himself opposed it, saying the bureaucracy necessary to administer the ordinance would cause “a long period chaos” in the city’s rental market.)
Richmond’s median rent price has been trending downwards, he said Tuesday night, and Richmond foreclosures are at the lowest rate in a decade. Similarly, the mayor reported, the warehouse market is doing great, with a 1.9 percent vacancy rate, but offices are “not so hot,” with a vacancy rate of 19.2 percent.
Last October, the city adopted a Climate Action Plan, which aims to get the city’s greenhouse gas emissions down to 15 percent below 2005 levels by 2020. Butt said the city now allows residents to receive 50 percent of their energy from renewables with MCE as opposed to the 30-percent renewable energy customers get with PG&E. MCE is a Community Choice Aggregation program, meaning it is not-for-profit energy provider that allows customers to join together to buy clean energy. A $3 million bond for the Richmond Housing Renovation Program is being put to good use, with three homes fully renovated and 17 more in the process of renovation, and nearly 200 people have had free solar panels installed on their homes courtesy of the city, he said.
Butt touched on policing and criminal justice reform in his address. In September 2015, he said, Obama-era Attorney General Loretta Lynch visited the city and praised the police department’s community-policing programs, and in April of last year, Richmond swore in a new police chief, Allwyn Brown.
Butt had good news about the retail business in Richmond. “Richmond is becoming a premiere Bay Area destination for craft beer and wine,” he said. Macy’s, which has been closing stores all over the country, will keep their location at Richmond’s Hilltop Mall. And, the mayor added, “I’ve got to give a shout-out to East Brother Light Station Bed and Breakfast. It continues to get five stars on Yelp.”
The mayor also spoke about volunteering and civic activities. “I have to talk about reading to dogs,” Butt told the audience, describing the All Ears Reading program where children, well, read to dogs. “When children read to dogs, it’s been proven to increase confidence and self-esteem,” the mayor said.
Butt didn’t forget the Rosies—the 2,229 people who set the world record for”Largest gathering of people dressed as Rosie the Riveter” in August, breaking a previous record set at a bomber factory in Michigan.
But the big picture for the city wasn’t entirely rosy. Butt acknowledged difficulty in raising revenue for the city, saying, for example, that Richmond is missing out on $1 – 4 million in unpaid taxes from unlicensed marijuana grow operations. He said the city raised $300,000 in code enforcement fines and fees in the last year, but many businesses simply operate without a license. On follow up, mayor’s office spokesperson Alex Knox said that, adding in Munis Services, the total estimated revenues from new enforcement will actually be higher, around $1.1 million. (Butt’s entire PowerPoint presentation can be seen here; slide 29 contains the information on Munis and code enforcement revenue collection.)
And, while crime is down overall, there was one big sticking point. “The bad news is homicides, which have been trending upward for the last two years,” Butt said. There were 24 homicides in 2016, over 90 percent gang-related, he said.
According to the mayor, a male in Richmond between the ages of 15 and 30 has a 0.4 percent chance of being a victim of homicide.
There are two main points Butt wanted the audience to take away, he told Richmond Confidential after his speech. “The first takeaway is that Richmond is just an incredibly vibrant, interesting community,” he said. “The second is, like all cities in the state, we’re going to have some challenges balancing the budget.”
Butt denied recent media reports that the city of Richmond is nearly bankrupt. A Los Angeles Times report last month stated that annual pension-related expenses for Richmond may reach $70 million a year by 2021 and could potentially bankrupt the city. Last month a KQED news report said that a state auditor had listed Richmond as one of six Californai cities at risk of bankruptcy.
Knox also disputed these media reports, and in an email to Richmond Confidential wrote that although in 2015 the state auditor had initially identified Richmond as a city with a “high risk” for economic troubles, it did not specify a risk of bankruptcy, and the city has not been audited. According to Knox, the state agency currently plans to monitor the city, with the option of performing an audit later.
“Richmond is no more on the verge of bankruptcy than any other city in California,” Butt said.
He said the city is facing financial troubles, however, and will have to get its budget in order. “Internally, we need to step up our effort to vacuum up every nickel we can from the revenue streams we already have,” Butt said. Beyond that, he continued, “We don’t really have a plan.”
The city’s budget will be prepared beginning in March or April, and finalized in mid-June, Butt said. Under Richmond’s system, the budget is prepared by the city manager (who is appointed by the city council) and then approved by the city council.
Richmond resident Richard Stollings, who came to hear the mayor’s address, thought Butt spent too little time in his speech on crime and policing. “They didn’t talk about the sex scandal, did they? They didn’t talk about the settlement they paid out in the police shooting,” he said, referring to accusations that Richmond Police officers engaged in prostitution, and a settlement payment of $850,000 stemming from a 2014 police shooting. “They don’t have any public input on anything,” he continued.
This article was updated on March 3, 2017 to clarify the description of MCE, to add additional figures about the city’s expected enforcement revenues, and to add mayor’s chief of staff Alex Knox’s response to previous news reports about the city’s finances.