Turlock could start feeling the pain of the deficit spending approved by the previous City Council, which includes the potential of closing one the city’s four fire stations about a third of the time as well as slower response times from police.
City Manager Bob Lawton talked about this as part of his proposal for Turlock’s 2019-20 general fund budget at Tuesday’s council meeting. The council asked him to recommend a budget that is balanced and has minimal impact on city employees.
“We certainly hope this is not a permanent state of affairs,” he said about the periodic closure of a fire station, “but we need to provide services all across the city.”
Lawton added that his recommendations will have similar impacts on police, and the city is facing two more difficult years with its general fund.
“This is the cost of having a balanced budget,” he said. “... We now have to find a way to pay for the things we bought with the money we did not have,” referring to spending decisions made by the previous council.
Lawton stressed that no decisions have been made and this was a recommendation to the council, which is expected to meet four times in June to put together the city budget ahead of the July 1 start of the 2019-20 budget year. He encouraged the community to weigh in as part of the process.
Tuesday’s meeting was packed with firefighters and their supporters, who made emotional appeals not to reduce public safety.
One speaker threatened council members that they would face consequences from voters, and some blamed city leaders, though some of the deficit spending is for contracts the city reached with its labor groups.
Speakers implored council members to find another way to balance the roughly $40 million general fund, though police and fire make up about three-quarters of the fund.
“I think the thing that gets me the most is the safety, the families, and just what we do every day,” said an emotional President Paul Arai of Turlock Firefighters Local 2434.
“I have three young ones at home,” he said, “and recently there was a call for service for a young boy. He was found at the bottom of a pool, pulseless and breathless, and your firefighters bravely went into action, and that boy walked out of the hospital. If you don’t think seconds count, I urge you to talk to that family.”
Arai told council members that he understands they face a difficult budget and difficult decisions but urged them to find another way. “... Please, please reconsider those cuts,” he said.
Turlock has been living beyond its means with its general fund budget and drawing down reserves.
The previous council last year approved about $3.8 million in spending — including adding four police officers, two dispatchers and three firefighters — that were paid from reserves. About $3.1 million of that spending is ongoing.
The council approved much of the spending when it did not have a permanent city manager. Lawton started with Turlock nearly a year ago.
The general fund was a top issue in last year’s mayoral election as then-Mayor Gary Soiseth unsuccessfully sought a second term.
General fund reserves were $14.9 million in the budget year before Soiseth took office in 2014. They are expected to be roughly $7.2 million when the current budget year ends June 30.
Lawton said that meets the Government Finance Officers Association recommendation that a city have reserves equal to two months of spending.
The general fund faces additional stresses, including annual increases in pension costs. Turlock expects to pay the California Public Employees’ Retirement System an additional $531,244 in 2019-20 for its general fund employees.
And the general fund owes the engineering fund about $2.5 million that eventually will have to be repaid.
Lawton’s recommendation includes eliminating 15 jobs that are now vacant or are about to become vacant as well as two jobs that are now filled. These 17 jobs consist of five from police, five from development services, four from parks and recreation, and three from fire.
Lawton said he could not yet offer specifics about these positions because the city continues to meet with its labor groups, but he expected he soon could provide more details.
He also is recommending police and fire defer $850,000 in vehicle and similar purchases and reduce their overtime by $685,000.
The reduction in Fire Department overtime and employees would result in closing one of the four fire stations about 30 to 40 percent of the time.
Lawton said he would rely on the Fire Department to determine how best to manage the closures to minimize their impacts. He said the pain is being felt throughout the organization.
Mayor Amy Bublak said Lawton decided on his own to reduce his pay as part of balancing the budget. Lawton said he is taking about a 14 percent pay cut.
He said that while Turlock has other funds, such as for water and sewer, it cannot use that money to help the general fund.
This all comes as the city is in negotiations with its labor groups, so there is the potential for concessions that could improve the general fund.
One potential area is health insurance. Turlock is self-funded and expects to spend about $8.2 million in its current budget year to provide coverage for employees and their dependents.
The employees and dependents expect to pay about $82,000. They are required to pay a copay when they see a health care provider. Turlock does not require them to pay monthly premiums, coinsurance or deductibles.
Lawton also said at Tuesday’s meeting that staff had made presentations to the City Council about tax increases but that has not gained support among council members.
And Lawton’s proposal does not assume potential revenue from cannabis businesses. Turlock is embarking on a pilot program to allow these businesses in the city, though that is in its early stages.