The Menlo Park City Council on Tuesday night quickly settled on a way to balance the general fund budget for the next fiscal year starting July 1 without touching a plan to add approximately 11 full-time employees.
Basically, the budget will be balanced by moving $1 million in planned spending from the next fiscal year to the current fiscal year, which ends June 30. The $1 million is for a Santa Cruz Avenue sidewalk project. The move eliminated most of the anticipated $1.15 million deficit in the 2015-16 fiscal year.
The city can add $1 million to spending in the current fiscal year without running a deficit because the city had anticipated a surplus for this year of about $2.1 million.
In addition, the council dropped $100,000 from the 2015-16 fiscal year spending budget. That expense was for a planned upgrade to an electronic key system for the city's tennis courts.
The council voted unanimously for this budget plan, which still authorizes the city to add approximately 11 full-time employees, largely to handle incoming projects, including large development plans.
"I like beefing up on staff to get the development projects," said Councilman Rich Cline, who added that the council would have to make the tough decisions in the future to cut staff should the demand for those jobs disappear.
"If there is a downturn, you have to let people go," said Councilwoman Kirsten Keith.
The development projects will produce revenue for the city once they are up and running, the staff pointed out in a report for the meeting. For example, the Menlo Gateway project, which includes a 250-room hotel, should return to the city more than $3 million a year, the report says.
The city learned recently that its general fund would be boosted in the current fiscal year by a surprise $491,000 payment from the state. This is like a reimbursement from the state for programs that the state had mandated but that the city had paid for.
With regard to projected budget deficits for the following two fiscal years 2016-17 and 2017-18 the city's economic development manager, Jim Cogan, said after the meeting that with the city's historic attrition rates, plus delays in hiring and unanticipated one-time money, there is a "good chance" the city won't have deficits in those years.
Councilman Ray Mueller, who expressed concerns about the long-term costs of hiring more people, said he is "taking it one year at a time." He said the plan to fund the Santa Cruz Avenue sidewalk project in the current fiscal year was a good move that he would have supported without a budget problem if he were told there were surplus funds available to fund it, as there are.
The sidewalks, which may be installed next year, would run along Santa Cruz Avenue between Olive Street at Hillview Middle School and Johnson Street at the Menlo Park Presbyterian Church and the beginning of the downtown area.
As for concerns about whether the city is over-staffed, the council asked City Manager Alex McIntyre to put the topic on a future agenda. The council intends to ask its finance and audit subcommittee to evaluate city staffing and recommend ways the staff can be reduced.