Modesto council takes grim look at budget-cutting options

kvaline@modbee.comJuly 20, 2013 

  • ABOUT THE REPORTER
    alternate text Kevin Valine
    Title: Reporter
    Coverage areas: City of Modesto and nonprofits
    Bio: Kevin Valine has been a copy editor and reporter at The Bee since January 2006. He's worked at the Reno Gazette-Journal, Sarasota (Fla.) Herald-Tribune and Paradise Post as a reporter and copy editor. He's a graduate of San Jose State.
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City Council members left a workshop Friday with no doubts about how difficult it would be to cut roughly $9 million from Modesto's budget. They heard a half-dozen people speak against closing the Maddux Youth Center, supporters of which say it offers a safe haven for poor children.

"The Maddux Youth Center is not going to be closed without a fight," said John Mataka, one of the six speakers. "It is a mainstay in this community."

The city has no plans to close the center, at least not yet. But the city listed closing it, along with 12 parks, the Dryden Golf Course and the McHenry Mansion and McHenry Museum, as an exercise in how the city could balance its 2014-15 budget, which starts less than a year from now on July 1.

The city is developing spending cuts in the event voters don't pass a 1 percentage point sales-tax increase in November. The temporary tax is expected to generate $26 million annually and $156 million over its six-year life.

Councilwoman Stephanie Burnside said the council got a taste of what it would face if it had to close the youth center, golf course and other facilities. She said the council heard from just one special-interest group Friday, adding, "Wait until you have to hear from all 20."

The council met with city staff at the King-Kennedy Memorial Center to start developing plans for potential spending cuts and spending options if the tax passes.

No decisions have been made, but the spending cuts could be dire, such as closing or selling Modesto Centre Plaza, the city's convention center, and eliminating the trimming of city trees.

Burnside questioned whether this amounted to scare tactics.

City Manager Greg Nyhoff said that was not the case. He said the city is trying to list every item where cuts could be made. The list included potential cuts to police and fire services.

Shortfall in general fund

Modesto's general fund is the focus of the budget discussions. It makes up about a third of the city's roughly $344 million operating budget. The operating budget's other funds are in good shape, but the general fund has a structural deficit of about $9 million.

Nyhoff said the city has cut spending but also borrowed from other accounts and used reserves to balance the general fund in recent years. The city can continue to do this for its 2014-15 budget, but after that, city officials say they will have to cut more spending and hope for additional revenues from a slowly improving economy if the tax increase does not pass.

Weighing options

Mayor Garrad Marsh suggested lessening the blow if the tax does not pass by cutting $6 million from the 2014-15 budget and using reserves to make up the difference before making deeper cuts in subsequent years.

The council did agree that if the tax increase passes, half would go to public safety, a quarter to roads, a tenth to rebuilding reserves and the remainder to parks and economic development.

The workshop focused on the big picture. The council's subcommittees will meet in August with city staff to flesh out and vet the proposals before they are brought before the council in early September.

The council is expected to pass a resolution in early September outlining how it intends to spend the tax money. But because the proposal is for a general tax increase, the money can be spent on any general government purpose. The current and future councils could change the resolution.

But city officials say that's why they will have an 11-member oversight committee to monitor how the tax money is spent. They added that voters can vote out council members who fail to honor the resolution.

Councilmen Dave Lopez and Joe Muratore did not attend the workshop.

Bee staff writer Kevin Valine can be reached at kvaline@modbee.com or (209) 578-2316.

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