By Monica Rodriguez, Inland Valley Daily Bulletin
Created: 10/29/2011 09:48:25 PM PDT
POMONA – The city isn’t through the first half of the fiscal year, but the staff has begun preparing City Council members for possible cuts in their 2012-2013 budget.
The current budget was assembled without too much struggle as a result of cost-cutting that has taken place in recent years, said City Manager Linda Lowry.
However, those reductions won’t be enough as some costs continue to rise, she said.
That means “we need to start planning,” Lowry said.
During the 2010-2011 budget year Pomona was able to hold down expenses, but the city also saw some of its revenue sources decrease, Finance Director Paula Chamberlain told City Council members recently.
Using unaudited figures that could change slightly, Chamberlain told council members during the fiscal year that ended in June that the city received about $79 million in revenue, about $1.7 million below what had been expected.
The city had about $80 million in expenses, she said.
Among the areas where the city failed to meet revenue projections was in development- related fees.
Projections called for $3 million to come into city coffers in the form of building permits, plan check fees, development taxes and other development fees, but only about $2 million was generated, Chamberlain said.
Property taxes declined to $26.2 million in 2010-2011 compared with the $27 million the city received in 2006-2007 – the city’s highest revenue-generating year.
In that 2006-2007 budget year the city also received $19.1 million in sales taxes well above the near $13 million for the last fiscal year.
The loss is the result of large sales tax producers such as Circuit City, Toy `R’ Us and auto dealerships, Chamberlain said.
But even those businesses that have managed to survive up to this point have taken dramatic hits that translate into less sales tax for the city, Lowry said.
At this point the city’s top five sources of the sales tax are service stations, wholesale building materials sales, restaurants, food markets and retail building materials sales.
When it comes to expenditures by category the largest was personnel which took up 48 percent of the general fund, followed by the city’s fire contract which took up another 28 percent.
If the expenses are broken up by department the highest cost is the Police Department which had about $38 million in expenses and fire costs totaled about $24 million.
The city has cut nearly 200 employees in the last three years.
In the 2007-2008 budget year the city had 777 employees, and it currently has 581, Chamberlain said.
The city has negotiated with the city’s labor groups to bring down employee-related costs and more will be needed, Lowry said.
“I think we’re at a point where we have to make more service reductions. We’re not going to balance need by making more benefit reductions for employees,” she said.
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