Finance Director Emily Wagner said it's clear that the country -- and Pleasanton -- aren't out of the woods yet when it comes to economic concerns, but a slight uptick in sales taxes and continued strength in the city's diversified property tax base indicate revenue will keep increasing.
The two-year budget that takes effect starting July 1 totals $87.3 million for fiscal 2011-12 and $89.7 million for fiscal 2012-13. Even though the budget is planned through the next 24-month period, it is also reviewed once a quarter when changes can be made.
"If we see a double-dip recession heading our way, we can make whatever changes are necessary," Wagner said.
Although the new budgets are higher than the estimated $86.1 million in revenue expected to be collected by June 30 -- and well above the lowest revenue receipts of $84.7 million in fiscal 2009-10 -- they are still considerably less than the record-high $91.0 million Pleasanton claimed in fiscal year 2007-08.
"We see the California economy slowly emerging from the worst recession in more than 80 years, a recession that officially started in the second quarter of 2007," Wagner said.
"During this period, Pleasanton has been able to maintain fiscal stability, avoid furloughs and layoffs, and has maintained both its financial reserves and all of the services provided to the public." she said.
Hiring and wage freezes over the last two years -- which will continue through these new budget years -- also have kept payroll costs in line, she said, along with a number of consolidations and reorganizations within the municipal government. Separate departments for planning, building and engineering were combined into the Community Development Department under a single director, Brian Dolan. The parks division was transferred from Community Services to the Operations Service Center, along with utility billing services. Business licenses were moved out of Finance to the Economic Development Department.
The city, which has reduced its payroll by more than 40 employees in the past two years, is now relying on contractors for cutting the grass in public parks and janitorial services. Even the issuance of dog licenses will soon be moved out of City Hall to be handled by the Valley Humane Society or the county animal shelter in Dublin. Bike licenses, once handled by city staff, must now be obtained online at a national registry.
Still, there wasn't universal euphoria when the budget numbers were reviewed at a recent City Council workshop. Bart Hughes, a frequent critic of the unfunded pension liability facing Pleasanton, said he thinks more could have been done to pay down that liability and to impose higher pension contribution rates for employees.
As it is, the budget includes a new 2% contribution agreed to by Pleasanton City Employees Association, the union that represents 227 city workers, which will increase to 4% in July 1, 2012. The budgets for 2012 and 2013 factor in those contributions, but not similar ones that will be asked of the police and firefighters unions when their contracts are negotiated in the coming months. Those contributions would reduce the city's budget obligations by an additional $2.5 million.
In their separate budget proposals, department managers showed major reductions in their personnel and costs since fiscal year 2009-10 when city revenue dropped significantly. Police Chief Dave Spiller said the department now has 81 police officers, compared to 87 in 2007-08 and that overtime pay has been cut by $102,800. At the same time, reports of criminal activity in Pleasanton have dropped considerably since 2008.
Librarian Julie Farnsworth said her budget for 2011-12 will show a 20% reduction from 2007-08. She also pointed out that with 30,200 square feet of library space, Pleasanton's is now smaller than many of those in other Bay Area cities its size, topping only Dublin and San Ramon. Livermore, for example, she said, has 59,600 square feet of library space with Fremont boasting more than 82,000 square feet.
Only Dolan was unable to cut 5% from his proposed budget for the coming year, as requested by City Manager Nelson Fialho.
Dolan said the department's resources are being stretched currently by demands to complete a Housing Task Force recommendation on affordable housing, required by a court order, as well as work required to complete a Climate Action Plan.
"We have a lot to handle right now," Dolan said, "including work on the East Pleasanton Specific Plan, Staples Ranch developments and the new Safeway and Clorox facilities."
Councilman Matt Sullivan agreed.
"Some people say we are close to build out so why do we have all these planners," Sullivan said. "But there's been much to do this year. You guys have done a great job with a lot of high profile projects."