City Manager Margaret Silveira said this week that the proposed budget has about $14.6 million in expenditures – for redevelopment, general fund and enterprise funds, as well as Measure I sales tax projects. That's down from the $15.8 million budgeted last year.
The city also has $12.8 million in revenue estimated in this fiscal year, Silveira said.
Part of that deficit situation, she explained, is due to property purchases, including the Green Ranch property.
The city has leased the land, the source of two-thirds of its current water supply, and is now purchasing it for $600,000, she said.
The city also has got water enterprise funding to do a feasibility study on its water rates, she said.
“We have quite a bit of deferred maintenance and we have some projects coming up that the city has committed to,” said Silveira, with one of those projects including a water main extension on Parallel Drive to service the new Mendocino College Lake Center.
Silveira said the city is working with the US Department of Agriculture on loans to cover Green Ranch and the Parallel Drive project.
In a budget workshop for the Lakeport City Council on Tuesday – which also was attended by council members-elect Stacey Mattina and Tom Engstrom – Silveira presented the updated budget document. She and city finance staff worked to clean up the budget, which included making fund balance transfers.
There was good news in the updated budget, including city property tax revenues coming in $40,000 higher than anticipated, Silveira said, along with some salary savings.
Silveira said the city's budget had shown a $790,000 deficit until they did the necessary budget transfers to put money where it belonged.
Some funds were being balanced by one-time monies, which Silveira said the city needed to cut back on doing in the future.
She also said that the Measure I sales tax funds – derived from a half-cent sales tax in the city – “are sustaining the very basic services the city needs to operate the city.”
The city will address its deficit situation moving forward, she said.
In the meantime, cleaning up the budget with fund transfers showed the the city had more money in the general fund than previously thought, according to Silveira. While there is a gap, there is enough general fund revenue to get by for two to three years, but the difference between revenues and expenditures can't be sustained long-term.
During the Tuesday budget workshop, Silveira told the council that she was proposing they leave the police chief's position open for the remainder of the year. That position is being covered on an interim basis by acting Chief Brad Rasmussen following the departure of Kevin Burke for the chief's job in Healdsburg.
There also are two additional open, unbudgeted police officer positions. Silveira said she was proposing putting in half a year's salary to cover reserve officers, as well as backfilling a patrol position for half a year. With the police chief's job not being filled and reallocating the other funds for other uses, there would still be a $40,000 savings.
However, she directed staff that until the police officers association and the city resolves the dispute over the 3 percent at 50 retirement plan – which the council had previously agreed to but voted down over the summer – no new hires be made.
Utilities Director Mark Brannigan told the council during the workshop that his department has analytical equipment for its water operations that is more than 10 years old, which they've been pressured by the state to change out for some time.
Now, the equipment is starting to fail, Brannigan said. “We're at the point of emergency replacement.”
Equipment needing to be replaced includes chlorine monitors and chlorine gas injectors. Brannigan said to replace all of the equipment it will cost $12,000. To replace just the equipment in the worst shape will cost $7,000.
On Thursday, Silveira said, “My goal right now is to bring down the cost of our day-to-day operations.”
That includes looking at renewable energy options for city facilities and cutting anything that doesn't impede service to the community, she said.
She said the city recently cut staff in its utilities department. “We're pretty bare-bones right now,” she said, adding that the public works department is down to “a skeleton crew.”
Silveira said she has a wonderful staff that is pitching in and bringing to the table ideas to help make ends meet. Staff also has in recent years begun paying portions of medical and other benefits.
The city may need to look into furloughs in the future, Silveira said. The city had furloughs in late 2008 and in 2009, as Lake County News has reported.
“We're looking at everything we can possibly do to cut the budget,” she said.
They're also considering ways to assist in increasing future revenues, such as annexing the S. Main Street corridor, Silveira noted.
Overall, despite the challenges, “We're doing OK,” said Silveira.
The council has planned a special followup budget workshop for 6 p.m. Tuesday, Nov. 30.
Silveira said a public hearing on the budget will then take place at the Dec. 7 regular council meeting, the same meeting at which Engstrom and Mattina will be seated on the council.
The budget could be accepted at that meeting or another meeting later in December, she said.
E-mail Elizabeth Larson at
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