City looks to adjust budget

Instead, council will review a laundry lists of additions and eliminations based on recent state action, economic conditions and city priorities, according to a report by Finance Director Richard Averett.

When adopted last June, the city's budget included $23.1 million for the current year and $23.4 million for 05-06. The operating fund totaled $31 million in 2005 followed by $31.5 million and a $6.6 million capital improvement budget.

In the year since, the city's million-dollar shuttle system was voted out of existence and Proposition 1A was passed by voters in November. Those changes, plus a series of small adjustments, added $854,100 in costs savings and new revenue to city coffers by the February mid-year budget hearings. If the proposed amendments are approved, the June 2006 general fund balance will be $500,000, according to Averett.

The recommended revisions include:

· The $50,000 November budget adjustment for the city's special SCOOT election should be increased by $26,111 to cover county expenses.

· In 2006, the Peninsula TV staff position funded by the city will be moved for a change of $69,036.

· Legal costs were unexpectedly high, requiring an additional $66,500 for the Human Resources budget.

· Building and Planning Department fees are quite more than anticipated, adding roughly $300,000 to the budget.

· Retiree medical premiums were under budgeted by $38,434 for this and next year.

· The 2006 contribution for the South County Fire Protection Authority is proposed to be $100,000 more than the amount budgeted by the city.

· The state's cut to fund education is $454,000 in 2006.

· The new police chief's housing loan requires $100,000.

· Transient occupancy tax is climbing slightly and expected to return about $35,000 extra.

· An extra $200,000 in total vehicle license fees is expected from the mid-year budget estimate.

· Increasing the sewer fund from $700,000 to $1.3 million.

· The elimination of the SCOOT shuttles releases $60,000 in gas tax funds for other projects.

City staff are expected to begin working on anticipated structural changes in early fall.

"Much work will need to be done next year to minimize service reductions and achieve fiscal sustainability," Averett noted in his report.

Michelle Durand can be reached by e-mail: michelle@smdailyjournal.com or by phone: (650) 344-5200 ext. 104. What do you think of this story? Send a letter to the editor: letters@smdailyjournal.com.