City of Lakeport deficit grows with $26,000 LAFCO billing
LAKEPORT ? A budget for the city of Lakeport was not balanced for two years. Starting in 2002-03 a deficit slowly grew into what the city discovered last summer was $1.5 million. And now the latest budget challenge for the city is a LAFCO bill for $26,000 that by mistake was not included in the 2007-08 budget.
The bill, which the city gets each year, was not written into the budget due to a combination of two factors, City Manager Jerry Gillham said, who took the job in June after moving to Lakeport from Oregon.
“In Oregon, the local government isn”t required to rebate back state agencies. The state takes it out upfront, so it didn”t cross my mind. I think Richard [Knoll ? Community Development Director and Interim City Manager prior to Gillham”s arrival] thought I was taking care of it,” Gillham said.
Gillham announced to the city council at its meeting last Tuesday that the bill had been “unexpected” and he “didn”t realize we have to budget for it.” The city does not have the money to pay the bill by its 30-day due date.
LAFCO Executive Officer John Benoit said he met with Gillham this week to work something out. “He came from Oregon, so he wasn”t around when we transmitted copies of the proposed final budget in May and June. That got done, and while the city was in between things [hiring new city manager Gillham], inadvertently the city did not put it in the budget. But we did send a notice to the city council, so it was aware of this back then. I”m working with Jerry on this,” Benoit said.
He said the city has gotten a bill of that amount for the past seven years, prior to that, the California Legislature funded LAFCO, not cities and counties as the case is now.
“In Oregon what they do is the county auditor takes the payments straight out of the account, and really that”s a much better way of doing things. But we go through this process [cities and the county paying for LAFCO] and it”s a lot more work,” Benoit said.
He said he doesn”t think the fact that the city can”t pay the bill in the next 30 days is a “big issue.”
“We”ll work with the city and Jerry Gillham on this. What”ll happen is toward the end of the year they”ll know where their budget is and then we”ll work it out [payment],” Benoit said.
In regards to the city”s budget, Gillham said it “looks like we”re going to be alright.”
“However, we haven”t balanced the books for two years, and didn”t really know until the end of bringing everything forward last summer that we”re about $1.5 million off. This year, in putting together the operational side we were able to put together a balanced budget. But here”s the caveat: that”s because of the sale of Vista Point [Shopping Center],” Gillham said.
The city sold the Lakeport Blvd. Vista Point Shopping Center in October for just over $1 million to developer Matt Riveras.
“This next year I don”t have a Vista Point. Next year operationally it isn”t going to be any better, so we”re essentially looking at coming up with an extra million dollars,” Gillham said.
He said it”s useless to point a finger to blame for past budget troubles. “I don”t care who”s at fault. I care about putting a system together that works. If someone wants to go find someone, there isn”t anyone to blame. It was what it was. If they found out there was an employee that was absconding with money that would be another thing, but no one was doing anything remotely questionable,” Gillham said.
The past city manager is not to be faulted, Gillham said. “Randy [Johnsen, past city manager who retired in June 2006] worked his tail off for this city, he didn”t do anything wrong?there was a lack of internal systems to keep track of cash flow.”
Contact Elizabeth Wilson at ewilson@record-bee.com
