Balancing the Budget for 2010-11
Anticipating a major financing challenge, last fall the City began working on the 2010-11 budget for the fiscal year that starts July 1. The Ad Hoc Citizen Budget Committee reviewed a 5 year fiscal forecast and spent months reviewing City budgets, audits and programs. After obtaining community input on revenue and spending priorities through a city-wide survey, the Citizen Committee made a series of short and long term recommendations for addressing the deficits projected as a result of lower property values and dropping state revenues.
The proposed 2010-11 budget follows the citizen recommendations. All departments have reduced expenditures, many the double digits. All administrative divisions are proposed to be reduced by 20% or more including Legislative, City Administration, and Human Resources. Three managerial positions are being eliminated (Assistant Manager, Recreation Coordinator and Public Works Supervisor), along with several part time seasonal workers for an overall reduction of 4.25 employees or Full Time Equivalents. The budget assumes no salary increases for City employees, and a reduction in benefits. The City is introducing a new health plan that reduces costs. Contracted consultants are reduced for the fourth year in a row.
Overall, the City’s General Fund budget is proposed to be $5.6 million, down from $6.6 million in 2009-10. Per the residential survey, service reductions have been made in the Parks Department, reducing recreational services and special events. The City is not purchasing any new Public Works or Public Safety vehicles, nor is it undertaking any major building projects. On the other hand, all existing Public Safety officers are proposed to be retained [personnel costs comprise 93% of that Department’s operational costs].
The City’s major General Fund revenue source is the general operations levy. This 11.8391 General Fund levy is proposed to remain at the same rate.
Due to the reduced property values, neither the solid waste levy nor the debt retirement levy covers related costs. To address this problem, the City is creating a Solid Waste Fund to account for all revenue and expenses related to garbage, recycling, and yard waste services. An increase in the solid waste tax rate is proposed from the current 1.1609 mills to 1.7755 mills. The debt retirement levy for the pool construction bond that the voters overwhelmingly approved in 2001 no longer covers the principal and interest payments and is proposed to increase from .5 mills to .6476 mills. Without these rate increases, the General Fund would be required to subsidize these specified expenses that were intended to be paid for by the fees levied. Otherwise, funds would be taken away from the operational budget, in particular, the funds available to support critical Public Safety needs, the highest priority identified by residents.
The City’s residential properties declined in value an average of 9% this year for tax assessment purposes. The proposed total levy amount of 14.2622 mills would still generate LESS property tax REVENUES than this past year, even though the combined RATE would INCREASE by approximately 5.5%. The City Council will hold a public hearing on the proposed budget on May 10 at 7:00 p.m. before considering adoption on May 17.
For more information on the budget, please see the
Resources section of the Finance Department webpage.
