Danville is Contra Costa County’s most fiscally healthy municipality according to an analysis of audited financial statements for the 2024 fiscal year. The town received 99 out of 100 possible points on the scoring system maintained by California Policy Center (CPC) which is based on research from the California State Auditor’s Office and the Hoover Institution.

Danville is comparatively affluent, but that is not the main reason for its high score. Regardless of whether their citizens are wealthy, municipalities can score well on this scale by maintaining healthy reserves and by limiting unfunded liabilities.

One city with more modest income that scores well on the CPC scale is Menifee in Riverside County. That city received a score of 90 despite having median household income well below the statewide average.

Danville is fortunate to not have a defined benefit pension system or retiree healthcare obligations. Town employees can participate in a 401(k)-style contributory retirement plan and receive an employer match, but they do not receive a guaranteed retirement income. Thus, even though Danville pays 15% of gross salary to the individual accounts of participating employees, it has no long-term pension liability.

One reason Danville has been able to avoid retirement obligations is that it does not pay public safety employees directly, relying instead on the County Sheriff and the San Ramon Valley Fire Protection District (SRVFPD), for police and fire protection, respectively. SRVFPD reported $118 million of unfunded retirement obligations in its 2023 audited financial statements, which are the latest available on its website.

You can learn more about the CPC analysis at our next CoCoTax meeting at 6pm on Thursday, September 25^th at the Chicken Pie Shop in Walnut Creek. Please reserve your place by signing up here.

The High Taxpayer Cost of California Transit

California’s 85 transit agencies required over $10 billion of taxpayer subsidies to operate and maintain their facilities in FY 2023 according to my analysis of reports these agencies submitted to the Federal Transit Administration.

Some agencies, such as the California Vanpool Authority (CalVans) require very little taxpayer. CalVans relies on volunteer drivers and passengers who pay relatively high fares.

Locally, some of our agencies require heavy taxpayer support. AC Transit, which operates buses in West County as well as in Alameda County, required $560 million of taxpayer support, ranking fourth among the eighty-five agencies. County Connection, which serves Central County, received less money overall but had very high expenses per passenger mile travelled while charging relatively low fares.

With more potential riders returning to the office, the gap between transit agency costs and revenues may improve somewhat once FY 2024 and 2025 figures become available from the federal government. But cost growth should once again outstrip revenue growth later in the decade. Transit is labor intensive, and the cost of employing public sector workers tends to increase faster than inflation.

But a solution is emerging from Contra Costa County, where the Transportation Authority is piloting driverless buses in collaboration with startup firm Beep. The initial pilots are modest, such as a small vehicle with an attendant going back and forth between two stops at Rossmoor, but Beep has more ambitious projects elsewhere. In Jacksonville, Beep is now running a downtown circulator in conjunction with that city’s Transportation Authority.

Driverless trains have a longer history, having been adopted in Vancouver in 1986. They are now common in Montreal, Paris, several Chinese cities, and Honolulu. We even have a portion of BART, the Oakland Airport connector, which is driverless.

Hopefully, local transit agencies will begin to embrace autonomous buses and trains. Otherwise, they will be back for more tax hikes like the 0.5% sales tax currently being planned for next November, through Senate Bill 63.