LAKEPORT – The tough economic times are having an impact on the city of Lakeport, which late Tuesday reported it has reached an agreement with its employee associations to have a work furlough program to cut expenses.

A report from interim City Manager Kevin Burke explained that current economic conditions and their pressure on sales tax revenue in particular is causing a budget shortfall.

Burke said the city's adopted budget for the current fiscal year 2008-09 contains a gap of approximately $400,000 between expected revenue and authorized expenses. At the time the budget was approved, a $400,000 line of credit was identified as the means to cover this expected shortfall in case of a cash flow problem.

Since the council adopted the budget, it's become apparent that actual city revenue will be significantly less than last year. Burke said current year-to-date sales tax revenue is approximately 10 percent less than the prior fiscal year.

The city doesn't yet know how the shortfall will play out for the rest of the year. At the same time, Burke said the city doesn't want to use the line of credit to keep the budget balanced, but neither does it want to reduce one of its most precious assets – its workforce.

In order to address the situation without cutting staff, the city reached an agreement with its management employees, the Lakeport Employees Association and the Lakeport Police Officer’s Association, for a work furlough plan in order to reduce expenses during the current fiscal year. Burke says the agreement is essential in order to put the city in a stronger cash position for the upcoming fiscal year.

The proposal is expected to save the city general fund $40,162 this fiscal year, said Burke. The city's water and sewer enterprise funds will save $26,378, for a total savings of $66,540.

Burke said employee salary rates will remain the same, but the city realizes it will decrease actual employee income and represents a significant sacrifice on the part of every participating city employee, including department heads.

The plan will require each full-time employee to be furloughed for six unpaid eight-hour periods during the rest of the current fiscal year, for a total of 48 work hours, said Burke.

For police officers on 10-hour shifts this would equate to four full 10-hour work shifts, plus an additional eight-hour period. Burke said all other staff would be furloughed for six full eight-hour work days.

In order to maximize savings, most staff will take their furlough days on the same day, so that city hall and the police department business offices would be closed, said Burke. This will result in additional energy and fuel savings.

Burke said the city and its employees have agreed to take the furloughs in connection with the holiday season in order to take advantage of historic low levels of activity. He said city hall already was scheduled to be closed for four days out of the next two weeks due to Christmas and New Year's holidays.

The result is that city hall will be closed for two weeks – Dec. 22 through 26, and Dec. 29 through Jan. 2, Burke said.

He added that in order to have the least impact on city staff, the furlough hours will be deducted in four-hour increments during each pay period over the second half of the fiscal year – beginning next month.

During the two-week period, certain crucial city services will be maintained, said Burke. They include police patrols and fire services, since no Lakeport Fire District employees are employed by the city. He said all other city staff will be available for emergencies the same as they are on any weekend or holiday when city hall is closed.

Additionally, Burke said water and sewer due dates for accounts in good standing have been moved to Jan. 9 due to the furlough. Utility bills cannot be paid in person at city hall during these two weeks; however, customers can leave their payments in the drop box at city hall, or wait until Jan. 5.

No customers who already are delinquent will have their water services shut off during this period, but any existing delinquent amounts will need to be paid by Jan. 5, 2009, in order to avoid services being shutoff, according to Burke.

In order to start water service during the two week period, call 263-3578 (recorded message), and leave the address where water service is to be turned on; city personnel will respond and after collecting a required deposit of $135, service will be turned on. In order to stop service, call the same phone number and provide the address where service is to be terminated; also provide a contact telephone number for city personnel follow up and/or return of initial deposit.

If a building inspection is required during this two-week period, please contact the planning department prior to the two-week period, or on Jan. 5, 2009, when city hall will resume normal operations.

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