Grass Valley staff proposes budget for next fiscal year
Grass Valley city officials are anticipating a stabilized year in the financial landscape as the national economy recovers at a slow but uneven pace.
“We have a good working model to work from,” said City Manager Bob Richardson, adding, “We have seen growth in the region and state. It’s a positive trend, but having gone through as many economic cycles as we have, we are looking for the time when the economy is not as robust. It’s always a guess.”
Based on a preliminary budget for the general fund, which staff presented during a meeting at Grass Valley City Hall Tuesday, the proposed expenditures for the upcoming fiscal year is $11,588,000, and revenue is budgeted at $11,766,000, which leaves the city $178,000 in surplus revenue.
A public hearing to discuss the budget for fiscal year 2016-2017 has been set for June 28 at the City Hall, when elected officials are expected to vote on the final budget for the upcoming fiscal year.
Compared to the budget for fiscal year 2015-16, revenue has experienced an uptick of $301,000, which is mostly attributed to an estimated growth in sales tax revenue, property tax revenue, and transient occupancy tax revenue.
According to City Finance Director Mette Richardson, the increase in revenue is also partially due to Mildred Anderson, who gifted $233,834 to the city. That money would be equally divided between the police and fire departments.
The city is also anticipating a $216,000 uptick in spending, compares to last year. This is partly due to salary and pension rate increases for staff in the executive service, management, police, fire and International Union of Operating Engineers Local 39 units.
A surge in the employer contribution rate set by The California Public Employees’ Retirement System also contributed to the increase in expenditures, officials said.
Per data provided by staff, the city’s employer contribution rate went from 15.70 percent in fiscal year 2014-15 to 27.79 percent in fiscal year 2019-20 for staff in the “miscellaneous first level” group. The employer contribution rate for employees under “police safety first level,” was expected to go from 27.85 percent in fiscal year 2014-15 to 44.30 percent in 2019-20.
“For every dollar we pay a police officer in the fiscal 2019-20 year, we are going to pay CalPERS 44 cents,” said Mette Richardson.
The city general fund has taken some hits in recent years.
In 2012, the city general fund budget was reported to be $10 million, a decline from $12.5 million in 2007, resulting in the equivalent of reducing 39 full-time city employees, including nine police staff and 2.5 firefighters.
In 2014, staff reported that they were bracing for a $2 million budget shortfall for the next five years as a result of increasing costs associated with CalPERS, payroll and benefit increases and rising costs.
In other business on Tuesday, city council members unanimously approved a 2.2 percent increase in development impact fees, which is a cost city staff collects from developers to offset all or a part of the cost of public facilities related to projects.
The inflation is based on changes on the Engineering News-Record Construction Cost Index for San Francisco, which city staff uses to adjust the local rate annually.
Barbara Bashall, executive director of the Nevada County Contractors’ Association, said the increase would not bring a significant impact to the construction industry.
“We follow the impact fees pretty closely, any increase would drive up the cost of construction,” she said, adding, “(2.2 percent) is not a substantial increase.”
A text amendment to the Whispering Pines Specific Plan was passed with a vote of 3-2 by the city council, with Council member Jan Arbuckle and Lisa Swarthout casting the opposition votes.
To contact Staff Writer Teresa Yinmeng Liu, email firstname.lastname@example.org, or call 530-477-4236.
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