“We’re still not out of the woods, but we’re doing okay,” said City of Placerville Finance Director Dave Warren, speaking to the Placerville City Council about the city’s 2013-2014 budget.
The 2013-2014 Operating and Capital Improvement Program Budget was approved for adoption at the June 25 City Council meeting with a 5-0 vote. The balanced budget totals out at $16,459,277 and includes $906,300 in capital improvement expenditures.
The city’s Budget Team developed both the Operating Budget and the Capital Improvement Program Budget over a six-month period which included workshops and public hearings.
The Capital Improvement Project Budget is a multi-year document. Budgeted capital improvement projects include restoration of the Lions Park outfield; repair of Town Hall’s frontage sign; Pavement Management System update; pressure regulator station replacements on Cedar Ravine, Wiltse Road, Ridge Court and Schnell School Road; and Sierra Tank bypass and a water line replacement in the Coloma/Conrad/Cottage Street area.
Warren reviewed the city’s current and forecasted financial position before presenting the proposed budget at the June 11 Placerville City Council meeting. Unemployment rates in Placerville dropped from 16.4 percent to 12.8 over the past year, a sizable drop but still much higher than the state and local region rate. In eight out of the past 12 months, the residential sale price in the greater Placerville area was higher than 2011-2012 and so was the number of actual sales.”We are heading in the right direction,” said Warren.
Sales tax revenue, 52 percent of the city’s revenue, is a mixed bag, said Warren. “We’ve had consistent growth in all areas in the last few quarters, except for sales of building materials and farm implements which is down,” he said.
Some of the city’s revenue funds, Measure J, and the downtown parking district revenues are of concern, according to Warren. Downtown parking district revenues are not covering the actual cost of operating the district and so no funds are being set aside for the maintenance and upkeep of parking structures and lots.
“We recommend the city reconvene the parking committee to evaluate the parking district operation and capital operating needs and make recommendations to the council,” said Warren.
The Measure J fund, a percentage of the city sales tax which funds salary and benefits for public safety employees, is balanced due to modest revenue increases and negotiated benefit concessions and the infusion of a grant obtained by city staff.” If sales tax revenues continue to improve, Measure J should remain in a positive position,” stated City Manager Cleve Morris in the budget document.
The first full loan $1,528,631 payment for Hangtown Water Treatment Plant is due in September and the Sewer Enterprise Fund Budget shows the payment being made with $886,863 from net operating revenues and $641,768 from the Rate Stabilization Reserve. The use of the Rate Stabilization Reserve funds is planned to smooth future rate increases over the next few years until sewer rates are incrementally adjusted to achieve 100 percent funding of the loan payment from operating revenues.
Measure H funds are being used to continue the sewer charge discount program through September and fund more than seven sewer and water projects. The Measure H Committee will review the sewer charge discount program this fall and make recommendations for any changes to the city council.
The Operating Budget also begins a two-year process of reducing the mandatory time off that city employees have experienced for several years as a cost savings, but maintains the 10 percent salary reduction and freezing of most positions.
“We are delivering about the same level of service as in the 2006/2007 Fiscal Year, with 35 percent less resources,” said Warren.