Atherton's five-year budget forecast is in, and the future looks grim for the town. The town's finance director is projecting growing expenses that will drain the town's reserves in four years.
The conservative projections reflect "the worst scenario the town could face," said finance director Louise Ho at the March 17 Atherton City Council meeting. While it might be a worst-case scenario, it was one that council members seemed inclined to believe.
"Certainly, this is not an acceptable plan, and it's not one we will even try to pretend to make," said Councilman Jerry Carlson. "The rate of growth of expenses every year exceeds the rate of growth of revenue. That's a problem."
Ms. Ho's forecast shows property tax revenue, the town's single largest source of revenue, will not be sufficient to support the town's police and public works departments.
"It's shocking to have it spread out like this, because clearly things are going to have to change," said Councilwoman Elizabeth Lewis. "We have to make some severe cuts."
The council called for a study session meeting to delve into the problem more deeply.
"This is a 'When did we go bankrupt?' five-year plan," said Councilman Jim Dobbie.
City Manager Jerry Gruber said his goal is to create a balanced budget this year that doesn't dip into the town's reserves.
"We keep saying this is the worst-case, but frankly, it's not," said Mayor Kathy McKeithen, who pointed out that town is still facing significant legal expenses that aren't reflected in the five-year projections.