With the recession behind it, city officials say finances are looking up in South San Francisco this coming year.
The City Council will vote on the 2014-15 budget Wednesday, June 11 and the council is mostly positive about the budget. The projected beginning general fund will see approximately $76 million in revenue and about $74 million in expenditures. This year, property taxes increased $72,000, while sales taxes increased $523,000 and transient occupancy taxes increased $250,000, a recovering trend from the recession, according to a staff report.
There is a solid budget this year, said Vice Mayor Richard Garbarino.
“I’m pleased with what we’ve come up with,” he said. “There’s some reserve money in there; it’s a little tight.”
While the budget is balanced, on a go-forward basis, rising California Public Employees’ Retirement System (CalPERS) retirement costs of approximately $5.1 million over the next five years for the general fund will mean that the next two- to five-year period will be critical for a major budget realignment process. Such a process will be needed to bring revenue in line with operating expenditures, deferred maintenance and capital infrastructure needs, according to the staff report. Pensions do worry Garbarino.
“If I said no, I’d be a liar,” Garbarino said. “We know there are going to be rate increases and hopefully we’ve planned properly for that. It’s a concern for all cities. Rates are going up and up and up. It’s an obligation we made a long time ago and we’ve got to live up to them.”
Even with that burden, the city is making good financial progress, councilmembers say. The city is putting some extra money toward making the city’s obligations more manageable, he said.
“This is the first year where we have some flexibility with the programs we’ve been postponing,” said Councilman Pradeep Gupta. “This year, a big part of the budget is we’ve added extra money for the Parks and Recreation activities. We are also looking at some of the maintenance issues we’ve been postponing on the roads and other infrastructure, so we have put some capital investment money into those.”
The city is very pleased with the budget and it will make way for capital improvement projects, said City Manager Mike Futrell. A new Capital Improvement Program which, combined with existing efforts, will create a $43.7 million program for downtown improvements, bike path and public park upgrades, Americans with Disabilities Act projects, traffic flow enhancements, water quality treatment advances and many other infrastructure projects. A major thrust of the program is improving South San Francisco’s downtown. This includes more than $1.8 million combined from the capital improvement and operating budgets for pedestrian and bike path improvements, enhanced landscaping and signs, replacement of coin parking meters with electronic meters, upgrading of downtown traffic signals, a revitalized facade grant program for downtown businesses and planning costs for a new pedestrian and bike path crossing under the South San Francisco Caltrain Station.
South San Francisco’s Park and Recreation facilities will also receive major upgrades, including $2.1 million in improvements to 10 different parks. The city will also allocate $5 million for maintenance of its extensive system of parks, trails and green space in its operating budget. Other major improvements include
$1.3 million for pedestrian and landscaping enhancements on El Camino Real between Chestnut Avenue and Arroyo Drive, and to begin design on the next phase of the Grand Boulevard Project improvements from Kaiser Way to the BART station. There will be $2 million put toward converting existing streetlights to energy efficient LED lighting, while $5.7 million will go toward public building facility upgrades, such as accessibility to those with disabilities, HVAC replacements and roof repairs. Additionally, $850,000 will go to library improvements, while Highway 101 will get some upgrades within the city. Another $10.8 million will go to sanitary sewer and treatment plant improvements, $4.5 million to Forbes Boulevard bike lane improvements and $1.3 million to energy-saving solar photovoltaic systems.
The city will be adding an economic and community development director in the proposed budget, while in anticipation of the current public safety chief’s retirement, additional funds have been added for a full-time fire chief and a full-time police chief.
“I’m pleased,” said Mayor Karyl Matsumoto. “We’re able to restore a new police chief, fire chief and economic and community development director. We’re getting back to restoring a lot of services we had to freeze because of the economy; it’s all very positive.”
Additionally, sales taxes are projected to increase $523,000, commercial parking taxes are expected to increase $200,000, while the revenue swap with the state is bringing in $800,000 to the city this fiscal year. Conversely, building and fire permits are decreasing to a more historical level from an unusually high level in the 2013-14 fiscal year, with a $786,000 expected decrease, while citation revenues are projected to decrease $375,000 and charges for services should go down $264,000. The city is also budgeting $500,000 for a project to modernize the city’s parking meter system.
The City Council meets 7 p.m. Thursday, June 11 at Council Chambers, 33 Arroyo Drive in South San Francisco.
(650) 344-5200 ext. 105