Compared to the last few years, much less time was spent wrestling with last-minute city budget problems on Tuesday, the week before the city's 2011-12 general fund budget is due. With only a few minor tweaks made Tuesday, the budget is now all set for approval June 14.
The relatively painless budget is possible partly because the city's $90 million general fund budget deficit recently shrank from $2.6 million to $2 million. The $600,000 difference came from a new estimate of next year's costs that showed a savings of $257,000. Another $357,000 was spared by mustering reserves to pay for predicted takeaways from the state. Interim City Manager Melissa Stevenson Dile noted what some council members had said in previous meetings — there's no point in having reserves if you don't use them.
The fill the new $2 million gap, the council supported filling 75 percent of it with $380,000 in "operational efficiencies" and $1.16 million in annual revenue from Google's latest lease of city property. Council members hope to get the final $500,000 from the city's unions, who are not being asked for a pay cut, but to reduce the $3.8 million growth in employee compensation costs expected next year. Unions had previously been asked for $1 million in savings. If that's unsuccessful, the backup plan involves the elimination of four city jobs, two of which are filled: the fire department's public outreach person and an assistant at the Mountain View Center for Performing Arts.
Following several tough budget years, and several more likely to be ahead, council members expressed their gratitude to interim City Manager Melissa Stevenson Dile and others for coming up with a balanced budget proposal that does not cut services or lay employees off.
The biggest controversy apparent Tuesday was whether to charge a $2 facility use fee for each of the Center for Performing Arts tickets given to non-profits who use over 10,000 of the free tickets every year for fund-raising and to promote the arts. Mike Cobb, board president for the Peninsula Youth Theater, said organizations would simply stop using the tickets because the fee would not be affordable. Council members agreed that there was no point to the fee in that case, and that it wasn't worth the potential loss of revenue to downtown restaurants and shops caused by fewer patrons at the theater.
Strategy will reduce reserves
The city proposes using as much as $1.4 million in reserves next fiscal year to deal with several predicted costs. The city's Shoreline Golf Course is expected to begin to lose money next year, and city officials plan to use $500,000 in reserves to keep it going until a new model for running the course can be implemented.
If the state decides to force redevelopment authorities to close, the city will lose $538,000 in reserves to maintain services funded by that tax district. And $50,000 could be used for "employee assistance" if several jobs are eliminated this year. Taking the hit is the city's general fund budget contingency reserve, which could go from $5.5 million to $4.1 million.