Despite an ongoing pandemic, the City of Turlock’s financial health isn’t as dire as expected with new revenue streams and federal disaster assistance bridging the gap, the Turlock City Council learned during its mid-year budget review earlier this month.
As with any budget, there is always good news and bad news. For the City’s mid-year budget, the good news includes higher than anticipated sales tax revenue, and new revenues from Measure A and cannabis business development agreement fees. On the negative side, the City of Turlock — along with every other government agency — has been hit with unanticipated COVID-19 expenses, a need for more funds spent on human resources, labor negotiation costs and increased vehicle maintenance.
City of Turlock Senior Accountant Nadine Silva gave the City Council an update on expected revenue at a special budget review meeting held Feb. 9. Sales tax at $6.8 million from July-November 2020, is trending at 10% above the benchmark for the time period, said Silva, while the transient occupancy tax revenue (hotel tax) and property tax are both also on track with the annual budget. However, Garbage Franchise Fees and Card Room Operators Franchise Fees are both falling short of anticipated revenue.
Another major shortfall in revenue comes from the City’s recreation department. With the state-mandated stay-at-home orders, the City’s sports fields and after-school programs are empty.
“COVID has absolutely impacted our ability to provide programs in the community. It has also negatively impacted our ability to rent our facilities to the community, whether it be a park space or whether it be the senior center or a sports complex field, so essentially what we’ve provided to you through this mid-year adjustment, it’s not the typical request to supplement with things that were unexpected but in fact it’s more of a true-up of where we stand today as a result of COVID,” said Parks, Recreation and Public Facilities Director Allison Van Guilder.
While regular recreation programming has been suspended, the City did launch a distance learning camp at the Stanislaus County Fairgrounds, which Van Guilder said is continuing. She is also still holding out hope that some programs may be able to resume in spring or summer.
Helping to bridge the gap in revenue shortfalls are the Measure A citywide sales tax, with an estimated impact of $2.7 million in new revenue for FY 2020-21, and federal CARES Act funding of $3.4 million. The City is also expecting $1.07 million in cannabis development agreement income.
The majority of the mid-year budget request expenditures comes from staffing. Before the pandemic the City was already reeling from a fiscal crisis, and the Council adopted severe cutbacks in staffing and maintenance to obtain a balanced budget. Those cutbacks were continued with the FY 2020-21 budget, anticipating further decreases in revenue due to the coronavirus pandemic. A total of 35 positions have been frozen in the 2020-21 budget, the majority in public safety (10 police and eight in fire).
The staffing funding requests include overtime pay for firefighters and the unfreezing of a human resources position so that the City can fill open positions that haven’t been frozen, according to City Manager Gary Hampton.
Turlock Police is in dire need of vehicle maintenance, as the department has suspended purchasing new vehicles for the past three years due to the financial crisis. Acting Police Chief Steven Williams was also seeking funds reinstate the department’s Care Team.
“The Care Team is a cadre of police officers and other staff members within the police department specifically trained and uniquely qualified to deal with mental health issues throughout the community. We partner with mental health professionals and go out and proactively deal with people who need services. We have cut that program completely because that is entirely on overtime. We feel we cannot wait any longer and are asking for $15,000 to get us through the rest of the year to reinstate that program,” said Chief Williams.
Along with revenue trends and additional budget requests, the Council also spent some time discussing Measure A sales tax and cannabis revenue. Council member Pam Franco and Andrew Nosrati both requested that the Council consider in a future meeting designating how to spend those funds.