LAKEPORT, Calif. – The Lakeport City Council held its first workshop last Tuesday on the upcoming fiscal year's proposed budget, a document which contains in it projections for aggressive capital expenditures for city projects and a balanced general fund.
Finance Director Dan Buffalo got high marks on his latest effort, which Mayor Kenny Parlet said was a “beautiful” document.
Buffalo said total city revenues in all funds total $15.73 million in the proposed budget, with total expenditures, at $18.78 million.
City staff is recommending a balanced general fund through use of budget surpluses, and does not use one-time funds for an ongoing funding source.
The budget, as Buffalo would explain, holds to established council priorities and attempts to tell the city's story with regard to investment priorities.
While the work of putting together the budget document typically begins in March, “Really, we're always in budget mode if you think about it,” Buffalo told the council.
This year city staff took a “simplified” approach to the budget, boiling it down to 120 pages from a document size that usually ranges around 200 pages, while still focusing on the pertinent information to help the council make the most informed decisions, Buffalo said.
“This document is very comprehensive,” Buffalo said.
It also contains what Buffalo called an “aggressive expenditure plan” relating to capital improvement projects for the upcoming year.
That plan totals about $8.3 million and is driven mostly by US Department of Agriculture Rural Development-funded projects for water and sewer system upgrades, along with the Downtown Main Street Project.
While aggressive, Buffalo said the plan is doable in the opinions of the city's department heads, with whom he and City Manager Margaret Silveira consulted in developing the budget document.
The expenditures – for such projects as infrastructure enhancement and rebuilding – are needed, and although it's a large amount of money, Buffalo said that in the context of the city's needs it's reasonable.
Buffalo said this budget also includes what may be the best two-year projections they've done yet.
He said Silveira wanted to focus on three core elements. Those include people – keeping the best people and attracting more of the same; service delivery – maintaining city services, restoring those that may have been cut or, if restoration isn't possible, refocusing available resources to improve current services; and fiscal responsibility, which is to be achieved through a balanced budget and identifying new revenue sources.
“We're trying to tell a story,” Buffalo said about the city's investment priorities, which focus on infrastructure and capital, economic development, and operating efficiencies and cost control.
Buffalo reviewed with the council the high points of the budget, and reported that the enterprise funds for water and sewer are improving thanks to rate hikes, with the water fund projected to be the black for the first time this year.
In outlining major capital expenditures, Buffalo reported that $2.6 million is set aside for road work, with $1.5 million of that to go toward the Downtown Improvement Project.
There also will be $4.89 million in infrastructure projects, $250,000 for new city docks and $853,000 for vehicles and equipment, he said.
The city also is looking to fill vacant positions. There is no department of the city where new hires are needed more right now than the Lakeport Police Department, where Buffalo said the goal is to restore staffing to a sustainable level.
“This budget is poised to help them get there,” Buffalo said, explaining that the city hopes to have the department staffed back up by year's end.
Understanding sales and property tax revenues
Buffalo anticipated that by the end of the current fiscal year there will be a fiscal surplus, which will come from personnel and operational savings, and deferred capital costs.
The city's regular revenue sources are relatively flat, while costs for pensions and health are up, he said.
Buffalo also featured graphics of how property and sales tax revenues are distributed.
Property tax, which goes to the county for distribution, most recently totaled just over $4.9 million, according to the graphic.
Of that amount, most – nearly 56 percent – goes to education.
Nearly 32 percent – or $1.5 million – went to Lakeport Unified, with another 15 percent, or $740,129, distributed to the Education Augmentation Fund; 6.2 percent, or $305,746 to Mendocino College; and 2.75 percent, or $135,842 to the Lake County Office of Education;
Twenty-two percent, or $1.1 million went to the county, while the city itself received 10.4 percent, or $513,542.
Other entities that receive property tax fund include the Lakeport Fire Protection District, 7.45 percent, $367,461; Lake County Vector Control, 1.69 percent, $83,570; Lakeport Municipal Sewer, 1.33 percent, $65,471; and Hartley Cemetery, 0.96 percent, $47,480.
Sales tax distribution is handled far differently, Buffalo said.
In the city, the sales tax currently is 8 percent, which includes the half-cent Measure I sales tax, which alone is estimated to generate $730,000 in the coming fiscal year and goes directly to the city. The rest goes to the state for distribution.
Most of the money ends up going into the coffers of the state government, which Buffalo said balances its own general fund on the backs of local governments.
The most recent annual total for sales tax collection given in the report was just above $12.6 million.
The state general fund received most of that amount, $5.8 million, plus another $394,494, while $1.6 million was allocated to the state local revenue fund, $788,989 to the state local health fund, $394,494 to the state education protection fund and another $394,494 to the transportation fund.
The city gets $2.3 million and the local public safety fund received $788,989.
“We don't get a whole lot but we try to do the best with what we've got,” said Buffalo.
Road upgrades discussed
Councilwoman Stacey Mattina asked about the $2.6 million planned for road projects this year, and asked how much was spent this past year, for comparison. Buffalo said the current year's budget had included spending of about $300,000 for road work, $150,000 of which was for repairs on Hartley Street.
Mattina asked how they could be spending so much more in the 2014-15 budget, and if that was something that could be done on an ongoing basis.
City staff said the increase was, in some cases, due to carryover work and contracted spending for projects like that to take place in the downtown.
Beyond the coming year, “This is not a sustainable capital plan,” said Buffalo, adding that it's necessary for city infrastructure and doable according to city department heads.
Regarding the budget overall, Parlet noted, “I feel very comfortable that the projections look really good.”
Parlet also said the city needed to move forward on addressing understaffing. “We need to help people shore up their needs in various departments to help ease some of that pain and suffering.”
Convening for just under 20 minutes as part of the regular meeting at 6 p.m., the council voted 4-1 to approve a proposed contract agreement for $957,137with Vulcan Construction and Maintenance Inc. of Fresno for the completion of the US Department of Agriculture water meter replacement project. Councilman Marc Spillman voted no.
The council unanimously approved a resolution adding a new 20-minute parking zone near Cheese's Main Street Pizza, increasing the city's current number of such “green zones” from seven to eight.
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