The Clearlake City Council has entered into its budget process for the 2007-2008 Fiscal Year. Members of the city council and various department heads, along with the city administrator, participated in two draft budget workshops finalizing the document for public review.
City Administrator Dale Neiman recently announced that a public hearing is scheduled for Thursday, Sept. 13 for consideration of public input on the draft budget.
“We are facing a number of very serious financial challenges that have to be solved,” Neiman states in his budget message. “We can solve them over a number of years or deal with them in one year. In my opinion, the best approach is to solve the problems in one year ? then the city will be able to move forward in a positive manner.”
Neiman recommended establishing policies to help guide the city in its decision making. These recommendations include: (1) that recurring revenues exceed operational expenditures; and (2) that fund balance reserves will be maintained at least at 15 percent of the operational expenditures.
“The second policy is important because the City needs to set-aside adequate funds to cover an emergency or unforeseen major expense(s),” Neiman wrote in his report. “We should also strive to have adequate funds in each reserve so inter fund burrowing is not necessary.”
Neiman said that given his limited experience working in the city, he believes the most important priorities are: (1) police protection; (2) street maintenance; and (3) cleaning up properties with blighted buildings and trash outdoors and removing abandoned cars from public and private property.
According to Neiman, on July 30 the city started the week with a $927,000 deficit in the General Fund. There was $4,262,540 in revenues and $5,189,520 in expenditures. The problem was primarily caused by increases in retirement costs (21 percent), increases in health insurance costs (19 percent) and pay raises granted to employees (10 percent).
“I met with the Department Heads and the recognized the problems we are facing and we worked together as a team in a positive manner to find solutions to our problems,” Neiman states in his report. “We reduced our operational expenditures in the General Fund by $926,580. We still have an operational deficit in the General Fund of $229,090. As a result, we still need to do more.”
Neiman recommended taking the following steps to address the deficit problem: (1) freeze all General Fund salary step increases; and (2) request the Clearlake Police Association and Middle Management Association to reopen the agreements to negotiate a lower salary increase.
The draft budget includes a plan to reduce the city”s annual attorney fees from $523,000 to $140,000. On average, monthly attorney fees were costing the city about $43,560. “One of the most costly tasks involved attending hearings at the Lake County Courthouse for police related work,” Neiman states in his report. “Our attorney had to drive from Sacramento and back to attend hearing(s). Tom (Gibson) worked with a local attorney to attend these hearings to reduce our cost.”
Funds for abatement of vehicles have been increased by $10,000 in the draft budget. “Last year the budget included $20,000 for towing vehicles and $10,000 for removing dangerous buildings and trash from private property,” said Neiman. “We are proposing to allocate $30,000 for towing vehicles this year so we can become more effective in making Clearlake a nicer place to live and raise a family.”
Neiman suggested that if the city takes the money it is collecting from liens being placed on properties and put it into a revolving loan fund the fund will build over time and ultimately the abatement program will become self sufficient.
An expenditure of up to $75,000 for the purchase of a used water truck for Public Works is drafted into the budget. The city council approved the expenditure during its Aug. 23 regular meeting. The expense has been included in the past three budgets, according to Neiman, however, was not purchased primarily due to lack of funds.
“In June the water truck”s engine blew up and cannot be repaired. We need to replace the water truck in order to maintain the street system,” Neiman said. “The productivity of the Public Works Department will be less if older equipment is used. The equipment has to be repaired more frequently than new equipment. Over time we need to upgrade the equipment and surplus the older equipment.”
According to Neiman”s report, 46.6 percent of the city”s streets are in poor to very poor condition and will cost a substantial amount of money to bring them up to an acceptable urban standard. He estimates that this would cost approximately $7,100 for a 50-foot wide lot. “The Council has appointed members to the Transportation Advisory Committee (TRAC) to evaluate ways to develop strategies to improve the maintenance of the streets and how the existing streets can be improved to a better standard. One of the strategies would be to develop a program to complete assessment districts when residents are willing.” Neiman”s report continues, “If a revolving loan fund is created and money added over the years as part of the assessment district formation, the program could theoretically run in perpetuity. Money is being allocated in the City”s Draft Budget ($86,000) and the Redevelopment Agency”s Draft Budget to complete a demonstration project to improve one street.”
The city”s has been allocated almost $3 million from the state to rehabilitate streets and has identified parts of Lakeshore Drive, Olympic Drive and Old Highway 53 for the work. The engineering design work is reportedly almost done and the city plans to bid the project in January 2008.
The Burns Valley Sidewalk project and Highlands Park improvements are also addressed in the draft budget. Both projects will utilize grant funds.
Contact Denise Rockenstein at drockenstein@clearlakeobserver.com.
