Petaluma council moves to shore up reserve fund

Petaluma City Council members on Monday agreed to put the city on a potentially long and painful — but ultimately more secure — financial track.

In a special meeting, the council informally agreed to create a policy that rebuilds the rainy day fund to healthy levels and assures revenues will be set aside each year to keep the fund robust.

In 2005, reserves were at nearly 22 percent of the city's general fund spending. But every year since, the city has drawn from the fund to stave off even more drastic cuts to services and staff during the recession.

Over the next six years, the council drained the emergency fund to its low point of 1 percent in 2011, an amount city leaders acknowledged was "precariously low."

A 1 percent reserve equates to about five days of expenditures, city Finance Director Bill Mushallo said.

© The Press Democrat |  Terms of Service |  Privacy Policy |  Jobs With Us |  RSS |  Advertising |  Sonoma Media Investments |  Place an Ad
Switch to our Mobile View