Council hears 2018-19 budget proposal

Revenues are up, Measure V tax is now largest general fund source

Council hears 2018-19 budget proposalBy BRIAN COSNER, News Review Staff Writer

Ridgecrest City Manager Ron Strand and city department heads presented their proposed 2018-19 budget to City Council during Wednesday evening’s budget hearing workshop meeting. While revenues have been slowly increasing since the 2008 recession, Strand and staff say the city is maintaining the status quo while catching up on unfunded liabilities and building up the staff.

According to Strand’s report, revenues are projected at $15.9 million for 2018-19, up more than $1 million from the previous year. The city plans to use roughly $380,000 as a one-time expenditure of reserve funds to cover the projected $16.3-million budget.

About $9.2 million of the budget ( roughly 57 percent) is expected to be spent on personnel salaries and benefits.

“Is that typical of other cities?” asked Mayor Pro Tem Mike Mower.

“I believe so,” said Strand, “but I’d be guessing if I answered that question.”

Councilmember Wallace Martin asked if these budget allocations could be compared to those of other cities and California as a sort of “sanity check.”

“We do have an extremely small general fund,” said Strand, “especially compared to other cities of similar size.”

Part of the city’s longstanding financial woes is due to a low tax base as a result of our high number of federal employees. Prior reports have shown our general fund revenues to be as little as one third those of similarly-sized cities in the state.

Strand did say that most other cities spent more than 50 percent of their general funds on public safety, which puts Ridgecrest’s 49 percent more in line with state norms. But he also mentioned that the temporary Measure V tax was now the city’s largest funding stream for the general fund.

The 1-percent Measure V sales tax brought in an estimated $4 million last fiscal year, about half of which was spent on streets and the other half on public safety. Measure V currently funds 12 police officers as well as other Ridgecrest Police Department staff.

Beginning in 2012 as Measure L, the tax was introduced to help the city fund street maintenance and repairs as well as public safety. Members of the public have argued that the tax’s original purpose was supposed to be primarily for streets and was never intended to pay salaries. But law enforcement has gone on record as saying the RPD would be a “defunct organization” without it.

“But the biggest financial issue we had with the budget was a change in the workers’ comp rates,” said Strand. He continued that rates have increased by more than 40 percent, resulting in a budget increase of $662,000.

In addition, the city’s various retirement and insurance funds are funded at anywhere between 70 and 90 percent – something the city has been improving over the years.

“This year, we budgeted what we believe is a sufficient amount to pay our bills for the next year,” said Strand.

Following public safety, general government received the second largest allocation of funds at 17 percent. Streets and culture/leisure each received 11 percent, and 5 percent was allocated for community and economic development.

The budget includes $110,000 in Christmas bonuses ($1,000 per full-time employee and $500 perpart-time) in lieu of cost-of-living increases and $141,000 in contingency funds for additional overtime that the city may be responsible to pay.

The precautionary measure is a result of the recent Flores v. city of San Gabriel case where the city’s cash-in-lieu-of-benefits payments were not properly included in overtime-pay calculations.

The budget also includes $70,000 for a lighting district and casino-impact study, looking at the tribe’s land-into-trust status with the federal government and at a state compact.

The council will continue to discuss the proposed budget through June, with the next regular meeting on Wednesday, June 6, 6 p.m., at City Hall.

For additional details on the proposed budget and future agenda items, see ridgecrest-ca.gov/council-agendas.

Story First Published: 2018-06-01