The $38 million budget forecasts a $470,000 deficit, with the city expecting to dip into its approximately $25 million general fund reserve to fill the gap. The City Council will review the budget in a public hearing at its meeting Tuesday, June 8.
In a staff report, Finance Director Carol Augustine said the budget minimizes "visible service impacts," and funds infrastructure projects at a steady rate. Hours at some city facilities are decreasing, as is park maintenance, with the city cutting 6.75 "full-time-equivalent" employee positions.
The budget takes a long-term approach to the city's finances, according to Ms. Augustine. A balanced budget is not necessarily a sustainable budget, she wrote, noting that the level of city services provided would fluctuate greatly if the city tried to balance the budget on a year-to-year basis.
While salaries in the police department are projected to increase by $620,000, total expenses are expected to rise by less than 1 percent, discounting anomalies in the current fiscal year. That is largely due to the reduction in staff size, and concomitant service cuts. The senior center in Belle Haven will close eight additional days per year, and the main library will close nine more days per year, generally following holidays.
Under an earlier recommendation, the city would have reduced hours at the Belle Haven library, and closed the senior center one day per week. Under the new recommendation, hours at the Belle Haven library would not be slashed, though they would shift so that the library is open for some night and weekend hours.
City management is advising against increasing the utility tax rate, because raising and lowering it too often creates administrative difficulties, and confusion among the populace, Ms. Augustine wrote. The city expects to focus more on its longer-term financial picture next year, when it has a better idea of the extent to which Menlo Park can expect to recover from the economic recession, according to City Manager Glen Rojas.
The city expects a 3.1 percent rise in revenue from the current fiscal year, with receipts of property tax, sales tax and hotel tax all projected to increase.
While Menlo Park appears to be in good financial shape, the state's financial woes, and the threat that the state could raid municipal coffers, continue to hang over the city. "Strong municipal budgets cannot be secured within an insolvent state," Ms. Augustine wrote.
The council meeting begins at 7 p.m. in the council chambers, located in the Civic Center complex between Laurel and Alma streets. The council will discuss the budget, and could approve it at its June 22 meeting.