How much will Menlo Park save by privatizing the new Burgess Aquatics Center? How much do the city’s child care programs cost?
If you’re asking these questions, don’t look to the city’s budget for definitive answers.
Staff has submitted the draft 2006-07 budget for City Council approval, and it calls for about $1.16 million in personnel and operating cuts and $378,000 in fee increases.
But the city will still have to pull $1.8 million from its unallocated reserves to bridge the gap between revenues and costs, largely due to high employee costs, according to a staff report by City Manager David Boesch.
“The pressure of substantial cost increases, especially in employee retirement and health benefits, has exacerbated the budget balancing process,” he said in the report.
The council’s consideration of the proposed budget is scheduled to start at 6 p.m. Tuesday, June 20, in the council chambers at the Civic Center, between Laurel and Alma streets.
Pool savings
Privatizing the city’s new, $6.8 million Burgess Aquatics Center is projected to save the city $415,000, but the draft budget doesn’t make clear how that figure was arrived at.The council voted 3-2 February 28 to privatize the facility, handing over operation to Tim Sheeper, founder of a local for-profit competitive sports program. Mr. Sheeper said he could run the facility at no cost to the city.
Council members Nicholas Jellins, Mickie Winkler and Lee Duboc cited the savings as motivation for privatization, but council members Kelly Fergusson and Andy Cohen said the city should have opened the pools as a city-run facility and determined its personnel and operation costs before making any decision to privatize.
Costs associated with operating the facility are still listed in the city’s draft budget, but Finance Director Carol Augustine said that’s because the city will pay for certain aspects of operating the pool — such as maintenance of the facility and the electrical costs — but Mr. Sheeper will reimburse the city’s costs.
But what the city is saving through privatization is still undefined: Ms. Augustine said the city doesn’t track the costs of aquatics programs at the Burgess and Belle Haven facilities separately, and the overhead costs associated with the Burgess facility — staff costs that won’t disappear with privatization — are yet to be determined.
Ms. Augustine said the projected savings of $415,000 are accurate because the city won’t have to cover the costs of staffing and operating the pool.
Child care costs
The city is seeking bids from private operators to take over its child care programs in the new Menlo Children’s Center at the Civic Center.But like data associated with the pool, an updated financial analysis of the programs has not been publicly released.
After being challenged by residents during budget hearings in April and May, city staff acknowledged that initial estimates that pegged the net costs of the city’s child care programs at $444,000 a year were too high.
The budget does not distinguish costs incurred by programs held at the new Menlo Children’s Center, leaving the net cost of the programs — what the city would save if a private operator took over — undefined.
Ms. Augustine said the council will be given information about the programs in a separate report.
Budget process
Heading into the current fiscal year, the city projected a budget shortfall of $2.9 million.In May 2005, the city began a community outreach program that asked residents and business owners — through a community-wide survey and budget workshops — what services to reduce and/or what taxes and fees to increase to cut the city’s projected deficit.
A 1 percent utility tax could add about $800,000 to the city’s coffers a year, according to city staff.
The council is also scheduled to consider other budget strategies, including employee layoffs and additional fee increases, in January.
INFORMATION
• To view the draft budget, go to MenloPark.org, and click on “Draft Budget 2006-2007.• Send your response to this article to editor@AlmanacNews.com. Note if it’s for publication, and if so, include your full name; residence (street and town); and phone number. Your phone number will not be published.
