SOLEDAD — City of Soledad is looking to the future with its budget forecasting, seeing bright spots with the movie theater and activity with residential building, expenditures in law enforcement and 911 dispatch.
“2017-2018 budget year is best described in two ways,” said City Manager Michael McHatten. “On one hand, the future is exciting. It holds promise due to resurgence and development activity reflected in the city’s economic recovery.”
McHatten said there is anticipated residential activity occurring and proposed commercial expansion, with the 13 acres of development for a movie theater.
“There are challenges on the horizon that will require the city’s continued diligence in managing service demands while developing revenue strategies,” McHatten said. “Some of the increases that are out of our control included in the budget are the cost for 911 dispatch service, PERs increases and health care costs.”
Restructuring efforts over the past five years with the city work force and budget reduction strategies have left the city with the challenge of doing more with less, according to McHatten. Should the city continue or improve service levels, such as bringing on a youth council similar to that of Gonzales, would also need to be factored in.
The city also had to take a hard look at the budget and see if there was anything that could be cut out, such as waste water capital projects and equipment vehicles, but upon a second look mid-year, McHatten said there were funds to keep those items in the budget. The city is also looking into a five-year capital plan to be able to strategically plan for expenditures in the future.
“Revenues are projected at $7.3 million, expenditures at $7.2, resulting in a difference of $172,000, which would be moved to the general fund emergency contingency reserve,” McHatten said. “If all goes as planned for the current fiscal year and next year, the contingency reserve should be approximately $1.14 million and the goal was $1.5 million. So we are making positive steps in that direction.”
Proceeds from Measure Y, the 1 cent sales tax measure, represent about 17 percent of the general fund revenue and are under an oversight committee to allocate those funds. The Measure Y funds break down to pay 4 percent to administrative costs, development at 5 percent, police at 40 percent, parks at 20 percent, fire at 18.5 percent and general fund reserve at 4.2 percent.
“General fund revenues are budgeted $514,000 higher than previous year,” McHatten said. “This is primarily due to property tax revenue and other taxes as we continue to see tripling improvement with regards to the economy.”
The expenditures for the 2017-18 fiscal year are budgeted at $479,000 higher than the previous year. The increase comes from the Police Department and the 911 dispatch fees. The 911 dispatch fees are approximately $90,000.
“The water fund is expected to have a deficit of approximately $101,000,” McHatten said. “We are working on that and depending on where we end up mid-year that could change.”
