Turlock budget would reduce deficit spending

An improved economy has boosted sales and property tax income to the city, but not enough to put an end to deficit spending.

The Turlock City Council will get its first look Tuesday evening at the draft budget for the fiscal year starting July 1. It shows about $34.7 million in spending in the general fund, up 4.5 percent from the current year. The city staff projects $33.9 million in income to this fund, which is mostly for police and fire services.

The gap would be closed by drawing about $826,000 from reserves, which would stand at an estimated $9.6 million at the end of 2015-16. The staff projects using about $1.6 million from reserves in the current year.

“The city of Turlock has experienced steady economic growth the past couple of years and continues to show all the signs of an ongoing positive economic forecast,” said Kellie Jacobs-Hunter, administrative services director, in a memo to the council. “… The projected economic improvements, while significant, are not yet sufficient for staff to propose a balanced budget.”

Turlock did not suffer as much as many local governments in the housing crash and ensuing slow economy over the past decade, but it did have to trim police, fire, recreation and other services. Water and sewer, the two biggest functions outside the general fund, rely mostly on customer bills.

The 2015-16 general fund budget projects sales taxes at $13.6 million, up from the $12.3 million expected in the current year. Property taxes are expected to be $9.8 million, up from $8.9 million.

The budget reflects pay raises in new contracts for all of the city’s employee groups, as well as expected increases in health and retirement costs.

The staff plans to refine the numbers, then return for a council vote on a final budget.

Also on the agenda:

▪ A staff request to have an outside auditor review the finances of the Turlock Convention and Visitors Bureau since 2009. The staff last month listed $241,297 in transactions that might not be allowable under the Turlock Chamber of Commerce’s contract to run the bureau, which has just ended. The list has been winnowed to $186,016 following a meeting with the chamber. The questioned items include spending on chamber events, city maps and transfers between budget years.

▪ Remodeling the council chambers under a $497,807 contract with Simile Construction Service Inc. of Modesto, the lowest of five bidders. The work includes audio-visual equipment, disabled access and lighting.

This story was originally published May 11, 2015 at 5:51 PM with the headline "Turlock budget would reduce deficit spending."