After four years of painful cost-cutting, Petaluma's budget remains tight, but new version aims to pay the bills in the coming year without layoffs or requiring concessions from employees.
The city has cut spending from $43.2 million in 2007-08 to a proposed $32.5 million for the fiscal year beginning in July. During that time, the city's employee benefit costs have increased dramatically and revenues plummeted on sales- and property-tax declines during the recession.
At its meeting tonight, the City Council will consider a proposed 2012-13 budget balanced through anticipated revenues of $32,478,000 and 5 percent across-the-board spending cuts.
The city essentially exhausted its reserve fund last year, with Finance Director Bill Mushallo forecasting a reserve balance of $377,000 after this upcoming fiscal year if the council adopts the proposal.
The council is scheduled to discuss and tentatively adopt the proposed budget. Formal adoption is scheduled June 4.
"Barring any negative effects from unforeseen circumstances, the reductions that balance the 2012-2013 budget establish positive balances through each of the next four years," City Manager John Brown said.
They are modest and even tenuous balances, he acknowledged, but an improvement over forecasts from just a year ago.
And some relief may be in sight. The city is projecting a $1.4 million surplus by 2015-16, in part from tax proceeds of the East Washington Place shopping center now being built.
Councilman Mike Healy called the budget "bare bones" and said many of the cuts can't be sustained over the long term without major service reductions.
The city is in the midst of negotiating with 11 bargaining units, but so far no agreements or concessions have been agreed to.