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The California State Auditor has officially removed the City of Richmond from its list of high-risk local governments, marking a major turnaround in the city’s finances after years of scrutiny over deficits, debt, and management of its housing authority.
State Auditor Grant Parks announced on Tuesday that the high-risk designation for Richmond, in place since 2022, has been lifted. The decision comes after the city demonstrated "satisfactory corrective action," which included bolstering reserves, achieving balanced budgets, and implementing new financial policies. Richmond now joins Calexico in being removed from the program, while Compton continues to be listed.
City Manager Shasa Curl announced the milestone during Tuesday’s City Council meeting, calling it a significant moment for Richmond after nearly three years of work with the State Auditor’s Office.
“I think I’m supposed to have a drum roll now, and we are all supposed to be extremely excited,” Curl said. “On October 7, the State of California Auditor officially removed the City of Richmond from its high-risk local government agency list, recognizing the city’s remarkable progress in restoring fiscal sustainability and accountability.”
Curl said the achievement reflects “a key step forward in the city’s financial recovery” and thanked the City Council and staff for their commitment through what she described as “an exceptionally difficult three years.”
“This has been an exceptionally difficult three years going through this process with the state auditor,” Curl said. “I’m really pleased that we completed this significant milestone and were able to get off the state audit list.”
The State Auditor’s report credited the city’s improved financial condition to several key factors, including the approval of Measure U in 2020, which restructured Richmond’s business tax and increased revenue, and a 2024 tax payment agreement with Chevron that will provide the city $550 million over 10 years beginning in July 2025. The first $50 million payment was received this summer. Both measures helped Richmond eliminate projected deficits and maintain balanced budgets.
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According to the report, Richmond’s general fund revenues have exceeded expenditures since fiscal year 2021–22. The city also increased its general fund reserves to more than $75 million at the end of fiscal year 2023–24, equal to about 30 percent of its annual expenditures.
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“This achievement represents a key step forward in the city’s financial recovery and positions Richmond for sustainable growth and a future of prosperity,” Curl said.
The State Auditor first designated Richmond as high-risk in 2022 because of anticipated deficits, high pension debt, and problems at the Richmond Housing Authority. The new report found that the city has “fully addressed” most of those areas, though some issues related to workforce costs and housing authority oversight are still in progress.
The full audit report, 2025-801 Local High-Risk Program, is available on the California State Auditor’s website.
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