Thursday, November 20, 2008

City budget under watch as numbers slip

While this year’s figures slow up, higher-than-expected surplus from the past year designated for maintenance projects

By Nao Braverman

Ojai seems to be staying financially afloat, at least for now, despite harsh economic times nationwide.
City Council members approved $167,000 in net surplus from the 2007-2008 fiscal year to go toward maintenance projects that have been waiting on the back burner, at Tuesday night’s council meeting.
Revenue budgeted for this year is $8.84 million in revenues with $8.3 million in expected expenses, for a net surplus of $540,000.
However, for the first quarter of this fiscal year, which ended in September, the city has collected $64,000 less than expected, said Jere Kersnar, city manager.
“Listening to my colleagues at neighboring cities, I’m hearing that this is a tough economic year for all of them,” said Kersnar.
While Ojai is currently on track financially, he cautioned decision makers, urging them to stay on their toes.
The shortfall was due to a $66,000 under collection in property tax, he said. However, first quarter property taxes are a very small amount, and not a good predictor for the rest of the year, he assured the council. More solid predictions should be made after property tax collections in December, he said.
“Times are very fluid and very uncertain,” said Kersnar.
But if surrounding cities are cutting back and downsizing their staff, Ojai has been comparatively fortunate.
While city staff had predicted a surplus of about $950,000 at the end of the 2007-2008 fiscal year, which would have been $217,000 more than initially budgeted, they actually ended up with $167,000 in excess of the predicted amount.
Since there would already be $217,000 more than budgeted going into reserves, Kersnar suggested setting aside the additional $167,000 in the capital projects fund, for much-needed maintenance.
The money would go toward repairing the damaged stucco and wood at the Boyd Center Gym and replacing some of the gym’s water-damaged floor, he said.
Kersnar concedes that the $167,000 in excess from the 2007-2008 fiscal year was timely considering that there may be even less money to spare in the near future. If those repairs get left any longer, costs could increase astronomically.
But as the tides have been turning for cities nationwide, city staff needs to keep a close eye on funds, should conditions change for the worst, he said.
Furthermore, there has been some concern that hotel reservations may not be as high as they generally are this month, said Kersnar. Though it is too early to make a solid statement regarding the hotel tax, which has been steady to date, council members considered having city staff meet with local hoteliers to brainstorm ways to keep hotel business in good standing. A primary revenue source for the city, the steady business of local hotels is important for Ojai, especially in these economic times, explained Mayor Sue Horgan.
Councilwoman Carol Smith agreed, denouncing illegitimate local inns that avoid registering with the city in order to doge the bed tax.
Councilman Steve Olsen proposed budgeting $10,000 for Youth Employment Services, which could be an asset to the community in these times. City staff agreed to place the budget recommendation on a future agenda for further discussion.
In other council news, Public Works director Mike Culver confirmed that the Libbey Bowl renovation project would require an environmental impact report because of its historic significance. The environmental report will likely delay the project, though Culver wasn’t sure by how much.
Slated to begin construction in January 2009, the project timeline is now up in the air, but Culver assured that staff would make sure it doesn’t interfere with the Ojai Music Festival. The festival has already raised about $930,000 mostly in pledges, for the project, said Music Festival executive director Jeff Haydon.
Also at the meeting, council members all said they wanted to become a Tree City U.S.A. The program, sponsored by the Arbor Day Foundation and the U.S Department of Agriculture would require the city to establish a tree commission and adopt a tree ordinance, which city staff warned would be too costly and time consuming to make up for the benefits.
Olsen, who thought the Tree City status particularly suited to Ojai, suggested having the Planning Commission serve as a tree commission, as well, to save costs.
Kersnar agreed to consider it, and bring the issue back to council after researching it further.
The meeting was adjourned in the memory of Marian Greenfield.

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