The good news is the City of Turlock's deficit spending in the 2015-16 fiscal year was $200,000 less than the almost $400,000 projected last June, however, City department heads are asking for a combined $1.2 million in additional spending for 2016-17.
The Turlock City Council held a mid-cycle budget review workshop on Tuesday, the first of its kind as the Council voted in 2015 to adopt a two-year budget rather than budgeting year to year. In his first budget meeting as City Manager, Gary Hampton presented both the $1.2 million in additional expenditures requested by the combined City departments, along with his recommendations for a much less $54,371 in non-budgeted requests for 2016-17.
Hampton also made the case for the City developing a comprehensive equipment replacement program, where the City would budget yearly for future expenses rather than have a single year's budget bear the total cost of an expensive equipment replacement.
"We're in a period of what I believe is a time of recovery and rebuilding from the economy. I also believe it's a time for us to begin considering taking a more comprehensive approach to how we replace our equipment. Currently, we work with the department heads to identify the equipment they're going to need replaced within that fiscal cycle —and when you're talking about police or fire, it could be significant. Police every couple of years could be five to $600,000 with patrol cars and we know how much it costs to replace an engine. In my opinion...an equipment replacement program is more properly managed when we pay for our equipment over time, so we complete a comprehensive review of our equipment assets citywide and annually fund into that equipment replacement. That will increase our operational costs systemwide...This will give us a static look and better handle of what it takes to manage the City," said Hampton.
The additional expenditures recommended by Hampton to the Council included: Computer software licensing , additional part-time staffing hours for human resources, police department K-9 unit expenses and daily operational expenses for the Turlock Regional Sports Complex, among others.
As the City is operating with a deficit budget, any additional expenditures would have to come from the General Fund Reserves. A 2011 City Council resolution established that the minimum General Fund Reserve is $6.5 million. The City's General Fund Reserves went from $14.9 million in 2013-14 down to $6.6 million in 2014-15 and is projected to be at $8.2 million by the end of June (with the proceeds of the sales of the old police department building on Palm Avenue to the Turlock Irrigation District).
Hampton said he felt obligated to give the Council some cautionary notes when it comes to the General Fund Reserves.
"Although we're beginning to see the growth, we're forecasting $8.2 million, I want you to realize that represents only 83 days of your operational costs," said Hampton.
The City Council is expected to review the mid-cycle budget again at their June 24 meeting and consider the proposed additional expenditures.