LAKEPORT, Calif. – The shape of the city of Lakeport's finances over the coming year was the topic of a special Tuesday afternoon Lakeport City Council budget workshop.
The 75-minute workshop, ahead of the council's brief regular Tuesday night meeting, was the second budget workshop the council has had so far this spring, following one that took place early in May, as Lake County News has reported.
Finance Director Dan Buffalo went over the basics of the budget document with the five council members, city management team and a small group of community members.
The proposed 2013-2014 city budget has $14.42 million in revenue and $16.72 million in total expenditures, said Buffalo.
Buffalo said the difference between the revenue and expenditures is largely due to projects such as water and sewer work that has federal grant funding to support it, as well as a road project and bond proceeds from the city's former redevelopment agency.
He said the hope is that the final budget document will be adopted later this month.
“You'll be pleased to know that it's doubled in size since last year,” said Buffalo, which resulted from city staff including a capital improvement project budget within the main budget for the first time.
The capital improvement project list includes 87 projects – from roads to vehicle replacement to new financial software – according to Buffalo.
Buffalo told the council that the document illustrates the “new normal,” adding, “the new normal is not 2006,” when housing was booming and money was pouring into the city.
“We are not going back to that time,” Buffalo said, adding the expenditures have gone up significantly for the city. “It's hard to find that balance now between matching revenues with expenditures.”
For the benefit of the newer council members, Buffalo explained that the city's budget serves many functions – it's not just a spending plan, but also a legal and a policy document.
“Were trying to present something that's more than just numbers,” said Buffalo.
The goals and outcomes included in the budget document, Buffalo said, provide a context about why the city spends the money that it does.
The budgeting process, Buffalo said, began with a strategic planning session in January, at which point the council established five citywide goals and strategies for how to achieve them.
This year's budget is a goal-based budget with a priority-based component. At the department levels, Buffalo said, the budgeting process starts with outcomes.
“We're hoping that it establishes the highest level of transparency and accountability,” Buffalo said of the new approach to the budgeting process.
The five goals around which Lakeport's 2013-14 budget has been built include maintaining strong council and staff relations, and encouraging leadership development; strengthening community and regional involvement; establishing and promoting effective public outreach efforts; enhancing activities and programs to support local and regional economic development; and focusing efforts on infrastructure improvements.
Among other budget highlights discussed at the Tuesday afternoon workshop were the condition of the city's enterprise funds, which cover sewer and water operations.
The city's water system had its first new rate increase in January with the sewer system to have a rate increase in July. Buffalo said the water and sewer systems are expected to be operating in the black by mid-2014.
City Manager Margaret Silveira is proposing to use a $200,000 surplus from the general fund to go toward dock repairs in Library Park.
Because of the cost to replace the docks, which Buffalo said could go as high as $800,000, city staffers are looking for grant opportunities in which the $200,000 could be used as a match.
The city's docks have generated numerous complaints, according to council members and staff. The condition of the docks resulted in the city losing the Wood & Glory boat show to Konocti Vista Casino.
Buffalo said that city revenues are relatively flat, but costs for things like personnel – particularly health and pension costs – and capital projects are continuing to rise.
As an example, he said CalPERS is trying to increase employer pension contributions by 50 percent over the next five years.
Buffalo briefly went over a general fund analysis with the council, with a chart showing revenues over the last several years. There was a large revenue spike in 2007-08, and he said that the city is not projected to be back to 2006 revenue levels until 2016.
Taxes, Buffalo said, form the largest source of revenue for the city's general fund. The city relies heavily on sales tax which, Buffalo said, is ticking upward, which he attributed to gas costs. In addition, he said auto sales in the city have been strong over the last few quarters.
The city's Measure I, a half-cent sales tax voters passed in November 2004, is anticipated to generate approximately $709,466 in the 2013-14 budget year, according to Buffalo.
The Measure I funds are proposed to cover several road and park projects, Westshore Pool and vehicle leases for Lakeport Police Department, according to the budget.
With the council having no major questions of Buffalo on Tuesday, it's expected the budget will come back for final consideration at the council's last regular meeting of the month, which takes place on Tuesday, June 18.
During the brief regular council meeting that followed the workshop, the Lakeport Main Street Association presented “Business of the Quarter” to the Soper-Reese Community Theatre and the council voted to reschedule a public hearing on the closeout of a Community Development Block Grant.
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City of Lakeport 2013-14 Budget - Recommended (Draft) by LakeCoNews
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