Dollars And Sense
Interim manager knows her way around finance
By Jeff Harris
March 2025
Leyne Milstein has her work cut out for her. Appointed interim city manager after Howard Chan’s dismissal, Milstein is guiding Mayor Kevin McCarty and the City Council through a difficult budget cycle.
A $77 million deficit looms, less if state funds for homelessness materialize.
Milstein is the most dedicated city employee I know. She’s been on the job for more than 20 years. We talked about the budget, her interim role and the future.
“I love this city,” she says. “I have stayed because I love the mission of following the money and making Sacramento a better place.”
Milstein became interim manager thanks to her budget experience. She became the city’s finance director in 2008 and has been running budget preparations since 2017. She knows where the skeletons are buried, unlike an external candidate.
As assistant city manager for finance, she warned the City Council its spending trajectory would lead to deficits.
Her words of caution weren’t appreciated. At least one councilmember and a union representative suggested Milstein wasn’t being honest about the deficit.
Undeterred, she says, “I have a professional and ethical responsibility to tell the truth.”
As a former councilmember, I agreed with her budget assessments. Other members and former Mayor Darrell Steinberg disagreed. Unfortunately, Milstein was right. The city faces its largest deficit in history.
Although revenues are high, sales tax revenue is declining. As President Donald Trump’s tariffs and deportations hit home, more reductions in revenues are expected.
Under state law, the city must balance its budget. Options include seeking concessions from public safety unions, laying off employees, reducing city services, increasing service charges or cutting programs.
“As interim city manager, my focus will be on working closely with the City Council to balance the budget while safeguarding vital programs and services,” Milstein says. “I deeply value the dedication of our employees and am committed to supporting them through this transition.”
She continues, “At the same time, I remain focused on doing the right thing for our city and its future. These times may require hard choices, but I am confident that, together, we will navigate this transition and continue to best serve Sacramento.”
Beyond the current budget troubles, outbound years show deficits with dwindling revenues, the CalPERS discount rate, union negotiations and City Council expenditures. The new city manager—a search is underway—faces these challenges.
Nine city unions are negotiating new contracts. In past years, the council succumbed to union pressure and approved unsustainable wage and benefit increases.
Changing the city charter to remove binding arbitration for public safety unions would provide leverage to negotiate affordable contracts. But that’s a bold move councilmembers probably won’t make. They typically support and fear unions at the same time.
Milstein is presenting options to City Council through April, with the goal of approving a balanced budget this summer. “They need to understand this universe much earlier in the budget process,” she says.
One option Milstein won’t present is to compete for permanent city manager.
“No,” she says. “I want to finish my career in Sacramento as an assistant manager.”
Jeff Harris represented District 3 on City Council from 2014 to 2022. He can be reached at cadence@mycci.net. Follow us on Facebook and Instagram: @insidesacramento.
