Burlingame dips into reserves

The city’s operating budget currently has a surplus of $2.4 million, and the projected $6.8 million general fund deficit is due to necessary capital project improvements, Finance Director Helen Yu-Scott said at a March 13 mid-year budget session when the City Council approved the budget report. 

The city will also transfer $500,000 from its general fund to its pension fund each year, Yu-Scott said. 

Burlingame’s general fund deficit will increase to $7.4 million in 2024-25 as the city plans to fund renovations to the police and fire departments, town square plaza development and Mills Canyon slide repairs, among other building restoration and Parks and Recreation improvement projects. The City Council also received a report on Burlingame’s 2024-25 capital improvement plans at its mid-year budget meeting. 

The general fund is projected to be above board again by 2028-29, Yu-Scott said. 

Councilmember Ricardo Ortiz emphasized that although the City Council has discretion around capital improvements, the funded items are necessary for the city to remain functional for residents and staff. 

“I look at the capital project fund and debt services fund, these are not luxury items, these are items we really have to do,” he said. “Yes it’s positive, yes we have some discretion when it comes to capital projects. [But] we’re not exactly swimming in it, those transfers are required.” 

City Manager Lisa Goldman said that Burlingame held back on capital improvement spending during the COVID-19 pandemic, which is part of the reason residents are now seeing larger numbers as the city attempts to catch up. 

“Once upon a time we didn’t see any red numbers, and then COVID hit and we see a lot of red numbers. We have been very judicious in the way we spent our revenues,” she said. “We did pull back quite a bit on capital spending, which is why you see such a big number this year.” 

Burlingame saw fairly high expenditure increases throughout the 2023-24 year for a $2.6 million tree services contract — which was decided in summer 2023, just after the budget was approved — $745,000 for contract carryover, $241,000 for labor negotiations fees and $393,000 for the Police Department’s overtime budget, which is offset by reimbursement revenue. 

But the city also saw an unexpected $1.4 million revenue boost for the 2023-24 year, with $909,000 more than expected in transient occupancy tax, or hotel tax, $100,000 more than expected in other taxes, $840,000 more than expected in services charges and over half a million in other excess revenue. 

This was offset by $568,000 less than expected in property taxes — an ongoing issue that many cities across San Mateo County are having with the state, which is not providing property tax fees in lieu of Vehicle License Fees as expected in previous years — and $371,000 less than expected in sales and use taxes. 

Mayor Donna Colson said that despite the appearance of the general fund deficit numbers, the city was continuing to keep a “tight lid on expenditures” and is maintaining a reserve fund of $48.6 million, including $5.6 million in anticipated extra unassigned funding. 

Aside from capital improvement projects funded via the general fund for the upcoming 2024-25 budget, the city has $10 million in funding set aside for the El Camino Real undergrounding utilities project and $15 million set aside for the Broadway grade separation project — two major upcoming projects.

Burlingame is also planning for a $3.6 million redesign of Old Bayshore Highway, funded through grants and development and impact fees. 

holly@smdailyjournal.com 

(650) 344-5200 ext. 105