Councilman Andy Cohen, who remained silent during the budget discussion, cast the only vote opposing the new budget.
The spending plan leaves the utility users' tax at 1 percent, and calls for a staff reduction of the equivalent of almost seven positions — a cutback that represents about $800,000 in savings, according to Assistant City Manager Starla Jerome-Robinson.
Four other staff positions that are now vacant are also under review to determine whether they need to be filled or could be cut, Ms. Jerome-Robinson said.
Service cuts will be felt in the next fiscal year, which begins July 1, and will include the closure of the senior center in Belle Haven eight additional days per year, and closure of the main library another nine days, generally following holidays.
The cuts in staff positions and services still won't make up for increased employee costs. Those increases are driven mostly by boosts in police compensation, City Manager Glen Rojas said.
Other employee groups accepted pay freezes and increases in their share of benefit costs during the last two years, according to Finance Director Carol Augustine. The city will continue to work with employee groups to reduce costs by means including a two-tier retirement benefit package for new hires, and "flexibility in using furloughs, if needed," she said.
The $38.1 million budget represents a boost of about $918,000 over projected spending for this fiscal year.
The $571,675 budgeted from the $25.5 million reserve includes $103,000 in anticipated costs for the ongoing project to create a specific plan for the downtown/El Camino Real area.
For the current fiscal year, the city had budgeted nearly $400,000 in spending from the reserve, but bumped that figure up to nearly $1.2 million earlier this year because of lower-than-expected revenues.
The 2010-11 fiscal year budget anticipates increases of about $300,000 in property tax revenue, about $229,000 in sales tax revenue, and about $222,000 in hotel tax revenue.
The council received a number of e-mails opposing the plan to use funds from the reserves to balance the budget.
Chuck Bernstein was one of several residents who, during the meeting, urged the council to make further spending cuts rather than spend from the reserves. Strategies such as staff furloughs rather than cutting more staff positions are ineffective, he said. "A furlough is not cost-cutting," he argued. "It's a reduction in service. But all the fixed cost is still there," he argued.
But council members noted that the city has been reining in costs and continues to look for more spending efficiencies. "We're going in the right direction, based on the numbers I've seen," Mayor Rich Cline said.
Saying that he doesn't want to "slash and burn services," Councilman John Boyle said: "We are in a recession. And we have the luxury of a reserve we could potentially dip into."
In explaining his opposing vote, Councilman Cohen said in an e-mail: "I believe it is high time this city manager balanced the budget. He's been hedging on this his entire three years in the position with a majority of the council's indulgence despite a public policy to balance the budget repeated each of the past five years (my entire tenure)."
The budget is based on an analysis by staff of "all operations of the (city) from a long-term point of view," according to a staff report. That review, called "2010 and Beyond," resulted in the identification of "strategies which would help move the city toward a sustainable budget in the long term," the report said.