Lakeport City Manager Jerry Gillham said the city will begin its budget process for the 2009-2010 fiscal year on Monday. But he already anticipates that shortfalls in funding, paired with growing expenses, may result in the city having to lay off much-needed staff.
The latest fiscal issue came on Tuesday, when the Board of Supervisors voted to send the city a letter asking for almost $15,000 in back payments for animal control services the county provides the city. If the city doesn't respond by June, the county intends to discontinue the services.
Lakeport had planned to begin providing its own animal control services later this fiscal year, which ends in June, because they believed they could do it for less than the nearly $74,000 the county now charges, said Gillham. But because of budget shortfalls, the plan may have to wait until next year.
With the city looking at having to possibly lay off police officers in the coming fiscal year, the animal control payments are a secondary consideration, said Gillham.
As of yet, Gillham said he had no ballpark numbers as to how many of Lakeport's 14 sworn police officer positions might face cuts.
Asked why the police department was being considered, Gillham said the department is “100-percent funded” by the city's general fund.
“We're going to be examining every facet of operations supported by the general fund,” he said.
He added that a $1 million shortfall can't be overcome “simply by not spending in certain categories.”
Gillham said city staff members are aware of the possibility of layoffs, as is the City Council. “Everybody knows it's a possibility.”
Police Chief Kevin Burke said his department is seeking alternatives.
“We're very aware that the city is facing some significant financial challenges and that reductions in staff are being contemplated,” he said Thursday. “But at the police department we are taking a very close look at our budget and trying to come up with some reductions in our operating expenses that will prevent us from having to lay off staff.”
It's not just police that could face serious cuts. Other departments that draw heavily on the general fund – including the Public Works Department – could see cutbacks, said Gillham.
Indeed, no one may be immune. “All positions are sitting there to be assessed,” Gillham said.
Gillham said he's been saying all year long that the city is facing tough times, and that he feels like people haven't grasped the magnitude of the city's financial situation.
Limited public discussion of the situation
The closest city officials have come to publicly discussing the layoff possibility was at an April 15 budget workshop, held before the regular council meeting. There, budget concerns – including an audit of city books that Gillham said is ongoing – were discussed, but in much more muted terms than Gillham used this week.
That April 15 meeting saw numerous city staffers from the public works and utilities departments – as well as seven Lakeport Police officers – in attendance.
According to a statement Gillham made at that meeting, 70 percent of the city's budget is spent on staff positions.
Then, the word “layoff” was used sparingly, as Gillham and the council discussed ways of addressing the city budget shortfall, which is not the result of missing money but rather dwindling funding sources and spent-down resources.
Gillham had proposed to council members a number of scenarios, including possibly taking a $3 million loan to get the city through the next few years while redevelopment projects kick in.
It wasn't an option the council widely favored. “I don't want to lay anybody off, but if it comes down to it it's going to have to happen,” said Councilman Roy Parmentier.
Mayor Buzz Bruns said he wasn't against a loan if it would stop layoffs. “I think the consensus of our group here is none of us want to lay off employees.”
Councilman Bob Rumfelt brought up the issue of the harm layoffs could do to the services Lakeport provides its residents. “We can't get rid of our people because we need support.”
Indeed, the city is applying to the Local Area Formation Commission to annex a 150-acre area into the city limits. In a report to the council, Burke said he expects the annexation to result in extra police calls for service and a larger overall patrol area.
Asked how the city would be able to police that extra area if it began laying off police officers, Gillham said, “We have to find a way to provide the level of services necessary.”
If it comes to layoffs, Gillham said the city will follow the bargaining unit agreements for which staffers will be let go.
City Attorney Steve Brookes, who is a lead negotiator with the city employee bargaining units, said the three departments that draw the most from the general fund are police, public works and administration.
“Public safety is the biggest general fund budget unit,” he said.
The different employee classification contracts call for the “last one hired, first one fired” protocol, said Brookes.
But at the city's April 15 budget workshop Councilman Ron Bertsch said he thinks the last-hired, first-fired approach “doesn't always work.”
Council members: Too early to count on layoffs
Councilmen interviewed by Lake County News say they don't know yet if they'll actually have to resort to layoffs.
“I really think it's too early to know,” said Bertsch.
He said he would much rather look at cutting consultants fees first. “To me that's the first thing that's going to go.”
Bertsch added, “All I can do is hope for the best right now.”
Bruns said a lot depends on the ultimate outcome of the city audit.
Layoffs, he said, have been discussed, “but it's our last alternative as far as I'm concerned.”
Bruns said this is the first time he's witnessed the possibility of layoffs in his eight years on the council.
The quandary the city faces, he explained, is whether to cut employees or services. “We have a dilemma there and we're trying to solve it.”
Higher costs of doing business – rising fuel costs and health insurance for employees – are among the challenges for the city, said Bruns. In addition, the city had to spend a couple million dollars to upgrade its sewer system to the state's satisfaction following a hookup ban issued against the city last year.
One possibility the city has, said Bruns, is liquidating some pieces of property it owns – “if push comes to shove.”
Bruns said Gillham has done “a heck of a job” to work out solutions for the city, along with the city's finance department team. “They're really working close together.”
With the budget process about to start, Gillham said the city needs to find a way to balance its budget.
“How we go about doing that is going to be a team decision between the council and staff,” he said.
E-mail Elizabeth Larson at
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