No layoffs in Richmond's approved budget
By Katherine Tam
Contra Costa Times
Posted: 06/23/2010 10:50:13 AM PDT
Updated: 06/23/2010 01:21:10 PM PDT
More than a dozen layoff notices have been rescinded and some proposed cuts restored in the balanced budget Richmond city leaders passed early Wednesday morning for next fiscal year.
A recent deal with the Chevron refinery will bring the city $10 million in 2010-11, enough to avert serious budget cuts.
The City Council early Wednesday adopted a $427.4 million operating budget, including $131.5 million in the general fund and about $8.5 million in reserves.
The city and employee union negotiated a two-year contract extension without a cost-of-living increase, and workers agreed to take the last week of December off so officials can close City Hall to save money.
The downturn in the housing market and recession have forced the city to cut back the last couple years. Officials shed 92 positions since last summer, mostly through early retirements, attrition and six layoffs, City Manager Bill Lindsay said.
Officials said they are relieved they did not have to resort to major layoffs like other cities have done. And Richmond's credit rating remains strong.
Still, Councilwoman Ludmyrna Lopez warned that officials must find stable revenue, and budget within what they can reasonably expect to generate annually to avoid future deficits. Officials should think twice about creating new positions during a prosperous economy, if they may have to cut those positions and lay off workers in lean times, she said. And the city should not tie its fiscal survival to short-term revenue sources such as tax settlements or proceeds from a land sale.
"It's our responsibility to make sure that we're living within our means," Lopez said during budget deliberations this month. "We can't just hope on these one-time deals that we're doing. We have to be very careful about what is that sustainable level of revenue that we can rely on year after year."
The city ended the last couple fiscal years in a deficit and tapped the reserve to balance the budget, she said. At Lopez's suggestion, the council finance committee will meet to craft a new policy in which city staff would seek council authorization before withdrawing money from the reserve.
Last month's tax deal with Chevron brings $114 million in new money to Richmond over 15 years. Chevron will pay utility taxes as required, plus $4 million to $13 million a year under a set schedule for the life of the agreement. In addition, the city and Chevron killed competing November ballot measures that would have changed the utility tax law.
Other budget cuts that were restored in the 2010-11 budget include maintenance for the Shotspotter gunshot detection system, public art money for nonprofit groups, and funding for the North Richmond Shoreline Festival and the July 3 festivities.