CLEARLAKE – A concept set to make its initial appearance before the Clearlake City Council this Thursday proposes to return parts of the city to county jurisdiction in light of the city's financial situation.

The meeting will begin at 6 p.m. this Thursday, July 22, at Clearlake City Hall, 14050 Olympic Drive.

In recent meetings City Administrator Dale Neiman has suggested to the council that they may want to consider giving portions of the city back to the county government.

However, at the Thursday council meeting the proposal will make its first formal appearance before the council.

Neiman – whose job recently was reduced to 20 hours per week as a way of saving money for the cash-strapped city – could not be reached for comment on the proposal Monday.

However, his two-page staff report explained that the city receives substantially less revenue and pays more for services than cities of comparable size, a statement he has made to the council in previous meetings.

“In order for the city to remain viable we need to increase our revenues or give parts of the city back to the county to reduce our service costs,” Neiman wrote.

Neiman explained that the technical term for transferring parts of the city back to the county is “detachments.”

The city has only two revenue sources that it can influence – bed or transient occupancy taxes from local motels and resorts, and sales tax revenue, according to Neiman's report.

Since 2007, annual bed tax revenues have dropped from just over $248,000 to more than $175,000, due to a variety of economic and algae issues, Neiman stated in the document.

While the reopening of the former Lake Escape Resort is expected to raise those tax levels to as high as $225,000 in the next three to five years, no other significant increases in bed tax are anticipated within the next five to 10 years, he reported.

During the same three-year time frame, annual sales tax revenues have dropped from just over $1 million to slightly above $945,000, Neiman's report said.

“We have tried to increase the revenues for the city, but our efforts to date have not been successful,” Neiman wrote. “In conclusion, the city will not see any appreciable interest in revenues over the next 10 years based on the past trends and the efforts to date to increase the retail sales tax base of the city.”

Neiman suggested that the “only remaining option” are the detachments, which he said will reduce service costs.

The report does not specially suggest which areas might be given back to the county.

Instead, Neiman proposes the council and staff evaluate several items – the city's current street conditions, demand for police protection as the population increases, current condition of the city's drainage facilities and future trends, conceptual drawings of what areas to detach to reduce the city's costs, and an analysis of the loss of revenues and a reduction in service costs for those areas considered for detachment.

He said the Local Agency Formation Commission (LAFCO) would need to approve the detachment proposal.

Detachment would have an impact on the county, and County Administrative Officer Kelly Cox said Monday that he was having a hard time knowing how to respond since he didn't know exactly what was being proposed.

Cox said he had lunch with Neiman and Lakeport City Manager Margaret Silveira last week, and Neiman has mentioned that the discussion would be coming up.

Neiman didn't say the detachment proposal was set for this week's agenda, which the city didn't forward to Cox – he got it from a third party.

Cox said that if Neiman is proposing dropping areas with underperforming revenue that require expensive maintenance and services, “obviously we would have concern about that.”

In such a scenario, all that would would do is transfer the city's problems to the county, and Cox said that wouldn't accomplish anything.

He said that's what the state is doing to counties and small governments – transferring the problem.

Cox said he didn't think LAFCO would approve the idea of keeping portions of the city that generate revenue and require less service and cutting loose other areas.

He joked that he would gladly take the Walmart and the old airport property on Highway 53 if the city wanted to hand them over.

However, there was another option Cox didn't rule out.

“If they're talking about disincorporating and transferring everything to the county, that's another discussion,” said Cox.

“If there's been a determination made that the city's not financially viable to exist, I think they should be talking about disincorporation,” he said.

Noting that these are challenging times, Cox noted, “I have a lot of sympathy for the city of Clearlake and all of the local governments in California right now.”

He said the county is willing to work with the city and help in what ways it can.

“It's important to us that the city succeed and, even more importantly, that the residents receive the services that they need, but there's a limit to what the county can do to help,” said Cox. “We have our own responsibilities.”

In other items scheduled for Thursday's meeting, the council will consider a notice of violation appeal lodged by Dorothy J. Williams for property at 3945 Laddell Ave., and present a proclamation to Kathleen Francis and her dog, Princess Abby, congratulating them on the little dog's win of the 2010 World's Ugliest Dog Contest in Petaluma last month.

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