2017-06-15 / Community

Salaries, police remain city’s top costs over next 2 years

Council agrees to make big investment in roads
By Becca Whitnall

BUDGET PIE—A breakdown of where the city’s $85-million general fund is expected to be spent in FY 2017-’18. Courtesy of City of Thousand Oaks BUDGET PIE—A breakdown of where the city’s $85-million general fund is expected to be spent in FY 2017-’18. Courtesy of City of Thousand Oaks

If there’s a big loser in the city’s next two-year budget, it’s local tire repair shops.

As part of the final step in their monthslong budget process, the council on Tuesday pledged $10 million in one-time general fund dollars toward improving the state of Thousand Oaks’ streets and roads, ensuring fewer bumpy rides and less wear and tear on tires.

“That was one of the things in the attitude survey people were very concerned about,” Councilmember Joel Price said at the June 13 meeting. “The council took that to heart and made that one-time, for now, expenditure from the general fund, and it’s going to go a long way toward keeping us not just in our cars, but making them operate efficiently.”

The city estimates total spending on streets to reach $18.2 million over the next two years, erasing several years of deferred maintenance caused by a loss in state and federal funding.

In all, it’s expected to cost $195.3 million to operate the City of Thousand Oaks in 2017-18 and another $196.1 million in 2018-19, according to the budget approved June 13. Unlike the state, T.O. operates on a two-year budget cycle, as opposed to one year.

General fund spending is estimated to average around $86 million per year, with the largest portion (38 percent), going to pay for salaries and benefits for the city’s 381 full-time employees and 186 part-time employees.

“We are in the public-service business so it’s all related to providing service, and that’s usually people, so salary and benefits,” Finance Director John Adams said during a May 30 budget workshop.

Coming in a close second (35 percent of general fund spending) is the cost of the city’s contract for police services with the Ventura County Sheriff’s Office, which will run $30.1 million in 2017-18 and $31.2 million in 2018-19. Thousand Oaks is the largest of the department’s five contract cities.

In 2006-07, the contract for the sheriff to provide law enforcement in Thousand Oaks was around $23 million.

Adams said his staff estimates that by 2018-19 the cost of the sheriff’s contract will exceed total sales tax revenue for an entire year. Sales tax is the largest source of income for the general fund.

At both the May 30 and June 13 meetings, Councilmember Al Adam stressed the need for attracting more businesses to the city. Economic development is key to long-term financial solvency, he said.

Outside of that challenge, the city’s immediate financial picture looks rosy.

The next two-year budget, bolstered by an increase in taxable sales and property tax revenue, calls for no reduction in city services and no layoffs, City Manager Andrew Powers said.

In all, Adams’ staff predicts city revenue to hit $81 million in 2018-19, an increase of about 1.9 percent from two years ago.

Ahead of Tuesday’s vote to approve the budget, Councilmember Rob McCoy joined the rest of the council present (Mayor Claudia Bill-de la Peña was absent) in expressing appreciation to the staff for its hard work in finding a way to make the numbers work.

But Adams has warned the council that long-term challenges lay ahead, chief among those: identifying consistent funding for streets/roads and the rising cost of pensions. A new state law that requires cities to make a larger contribution toward their employees’ pensions will cost T.O. an additional 8.2 percent next fiscal year and 13.4 percent in 2018-19, according to the budget, or somewhere between $6 million and $7 million per year.

Adams said it’s something the council will need to address down the road by possibly making larger annual payments to CalPERS. Should the stock market, where funds are stored, make a large, prolonged uptick, the demand for increased city funding could diminish, as well.

Though the council approved the budget with little discussion Tuesday and only slightly more at the May 30 meeting, Councilmember Andy Fox warned at an earlier meeting that the time could be coming for the body to make some difficult decisions.

“It’s a very good budget, a blueprint for a solid, well-managed and operated city that provides a variety of services and even has some surpluses,” he said, but noted that’s the case because past councils have made difficult decisions that may have been unpopular at the time, like those surrounding water rates and maintenance issues and the theater fund.

“Council’s likely going to be faced with some of those challenges again,” he said.

This is the first in a series of stories on the City of Thousand Oaks’ 2017-18, 2019-18 budget and its impact on local residents.

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