Overview of 2018 Budget Discussed at Elk Grove City Council Meeting

May 25, 2017 |  

With the July 1, 2017 deadline for submission of the State of California's mandated municipal balanced budget approaching, the Elk Grove City Council received an overview of the 2018 fiscal budget and capital improvement plan at their Wednesday, May 24 regular meeting.

City Manager Laura Gill's presentation provided an overview of the proposed budget that was assembled based in part by the goals set by the City Council. Gill said the budget would come back for further consideration at the June 14 meeting after the council and public had an opportunity to review the document.

Among the highlights, Gill said the City's ongoing road maintenance deficit will be narrowed by the passage of California Senate Bill 1, which raised gasoline taxes statewide for a variety of transportation needs. Gill said in fiscal year 2018, the city expects to receive about $1 million, with the amount increasing to $3 million for fiscal year 2019, and $3.5 million thereafter.

"This impacts the city positively in two ways," Gill said, " One, it does increase funding for road maintenance. which helps decrease the urgency of general fund argumentation in the short term."

The budget also allocates funds for the construction of a long-sought animal shelter. The City has historically contracted with Sacramento County and SPCA-Sacramento for these services.

To pay for the facility, Gill said there would be "debt issuance" for construction. Gill said this cost increase, as well as operating costs, would be partially offset by the elimination of payments to Sacramento County for their services. 

To avert future pension woes that are affecting many California municipalities, Gill said the City will continue to prepay its CALPERS pension liabilities. 

"By prepaying PERS for these unfunded liabilities, we are taking advantage of the PERS seven-percent rate of return versus the one-percent we are currently earning through the states local agency investment fund," she said.

Regarding expenses, the Elk Grove Police Department continues to be the largest single cost consuming 58-percent of the general budget. 

As presented, the general fund is expected to receive funds totaling $68.1 million, which represents a 2.6-percent increase over the current fiscal year. General fund expenditures are budgeted to increase 4.4-percent to $67.8 million.

During their brief deliberations, Council Member Darren Suen indicated his support for adopting the budget as presented.

"Good work everybody, look forward to hearing for adoption in three weeks," Suen said. 

During public comment, Elk Grove resident Lynn Wheat commended the budget as presented. Wheat noted that using the money the City is expected to save on the new garbage contract with Republic Services for use on prepayment of the planned community center at the Civic Center was fair given Laguna Ridge residents are shouldering the majority of those costs through high Mello Roos fees.

"I do like the idea of using the money from that was saved from the waste contract to go into the community center because it was suggested more than just those residents who live in Laguna Ridge," Wheat said. "So the rest of us ought to be putting in some of our money for that facility."

Although the City Council is expected to approve the budget at the June 14 meeting, the budget could be revised and approved at their June 28 meeting.