Mayor John Lazar started the Budget Review Meeting by stating that the City of Turlock has a $4 million General Fund deficit with $20 million in reserves.
“It is my sincere desire not to lay-off any employees during these tough times, particularly since we one of the strongest reserves of any municipality in the state,” said Mayor Lazar. “We should also be very thankful for a healthy reserve fund to help us through this uncertain time, and that is precisely why we created this fund in the first place.”
Mayor Lazar also stated that many of the budgetary issues the Turlock City Council will be facing will depend on state and federal decisions made while addressing an uncertain challenging economy.
Gary Hampton, the Interim City Manager and Police Chief, introduced staff reports with an opening statement asking the Turlock City Council to give them a strategy so that staff could work on a proposed plan. Usually city staff proposes a plan and strategy but this is year requires more direction as to not waste taxpayer’s money by not having staff waste time putting together proposals the Council may never consider.
Councilman Ted Howze threw out his projection of a possible $5.28 million deficit by the end of the year if nothing changes. Howze suggested that spending $8 million over the next 3 years. He stated he believes a 30% reserve fund would be appropriate as of now.
Councilwoman Amy Bublak stated that she would like go a little deeper into the reserve because that’s what it is there for. Councilwoman Bublak would like to use reserve money to soften the blow a little bit more to take care of the people that work here as well as making sure they’re providing the appropriate services.
Councilman Kurt Spycher brought to light that we may just be seeing the beginning of this bad economy as the City of Turlock has not yet felt the impacts of businesses such as the closed Varco-Pruden, Mervyn’s, Circuit City and Turlock Auto Plaza’s recent closing announcements, and Woods Furniture’s relocation of downtown stores to their highway 99 location outside the city limit.
Councilwoman Mary Jackson agreed with Bublak about using more reserve this year to keep people employed while working to maintain service levels the best the city can. Jackson also stated that basically $27 million out of the $34 million General Fund is salary and benefits. Jackson’s point was the only way seems to be salary cuts across the board.
Turlock Citizen and attorney Michael Weston spoke stating that it is easy to underestimate the value of human resources. Weston said that when the time comes to cut, he hopes employees don’t get caught up in debating who is more valuable or thinking that their job is safe because the community needs all the employees and services.
“You’ve got a bunch of nervous employees,” said Turlock City Employee Association’s Counsel Bob Phibbs. “On behalf of TCEA, we know these are challenging times. We will be working with your representatives and management. I have a lot of confidence that we will be able to work through these issues.”
Interim City Manager Gary Hampton pointed out that even if the city eliminated every non public safety position currently funded through the General Fund today, the city would not be able to close the budget deficit. He was talking about closing city hall and every public service department that does not provide police and fire services. Hampton pointed out that fortunately we currently have a safer community than most and that all services will have to be pared back.
To clarify, Hampton reiterated what he and city directors were to be incorporating into proposed budget strategies and scenarios.
Council is prepared to consider using reserves incrementally while ending up with around 25-30 percent of a General Fund reserve after 3 years.
Acknowledge that staffing cuts are necessary including the possibilities of top down cuts starting from management, work furloughs, voluntary salary reductions, paying more for health coverage, and such.
When Hampton asked if Council was prepared to reduce services (if job cutting scenarios were implemented), Mayor John Lazar said that Council would look for strategies to be brought back by staff.
Hampton spoke previously about how the Police Union in Stockton was not willing re-open labor contracts and forced 29 police officer layoffs.
Councilman Howze said “Time is of the essence. We continue to bleed everyday and the longer we bleed the tighter the tourniquet’s going to be… I hope our labor unions understand that. ”
The Turlock City Council looked to be comfortable with using about $8 million over the next 3 years to end up with around a 30% reserve of the General Fund. This would allocate $2.5 million a year from reserves to make it through these tough economic times. Strategic proposals should be presented to Council by late March, if not sooner.
A highlighted area of concern came from a citizen’s questions and Councilman Howze.
There has been a reported and supposedly understood hiring freeze throughout the organization. Citizen Tanya Abrams asked how then could the Fire Department just hire 8 new firefighters in December while the Turlock Police Department willingly left approved positions vacant knowing they may very well have to lay off these employees soon after.
Councilman Howze clarified that Fire Chief Mark Langley did due diligence by asking management if he should go ahead with filling the positions approved in June 2008. Councilman Howze stated that he was shocked when he found out the 8 new firefighters were hired because he was assured by the former City Manager Tim Kerr (in a previous Council Meeting months ago) that there was a hiring freeze.
Councilman Howze asked Fire Chief Langley “Chief, would you have filled 8 firefighter positions in December had you been given accurate information as to the revenues and expenditures in this city and where the budget lies?”
Fire Chief Langley answered “In good ethical conscience, I would not offer those positions.” Langley went on to clarify that these applicants sometimes only get once chance to get the best job in the world and he couldn’t see himself not allowing those people a chance to at least fulfill their dream. He will let Council now make that decision.