DOWNEY - Unwilling to dip into city reserves, the Downey City Council last Tuesday approved a $140 million balanced budget, preserving cost reductions while maintaining vital city services. The approved budget is a reduction of $15 million in spending from three years ago, demonstrating the effort of city officials to reduce costs and reconfigure the organization to run more efficiently for less money.
With the economy stabilizing, city officials expect an increase in general fund revenues for the 2013-14 fiscal year to total $67,556,475. The city's two key sources of revenue, sales and property taxes, are estimated to increase 11.6 percent and 7 percent respectively.
Next fiscal year, property taxes alone will garner $21.4 million in revenue while sales taxes will bring in $16.3 million.
City revenues will also collect nearly $7.1 million from the Utility Users tax, $3.8 million from Downey Fire Department services, and $2 million from community services.
Overall, revenues are projected to increase 3.6 percent higher than last fiscal year.
City staff currently estimates general fund appropriations to reach $67,544,066, leaving a $12,409 operational surplus.
The bulk of city expenditures is directed towards public safety with $26.2 million budgeted for the Downey Police Department and $16.1 million for the Downey Fire Department.
General government spending on administration and personnel is 12 percent of city expenditures, totaling $8,307,315. The remaining funds are allocated to public works, community services, and community development.
Using federal grants, city enterprise funds, and other capital revenues, the city is set to spend more than $35 million on capital improvements during the 2013-14 fiscal year. $20.5 million of the capital funds will go towards street improvements.
According to interim finance director Anil Gandhy, the council asked staff to produce a balanced budget that did not rely on the reserves.
"In order to achieve a balanced budget, several significant cost reductions were incorporated last year," said Gandhy.
During budget talks last June, council members closed an $11.5 million deficit through shape spending cuts, layoffs, early retirements, program reductions, and equipment maintenance deferrals.
As a result of those steps, this year's proposed budget was already tight, requiring no use of reserve funds. The 2013-14 fiscal budget projects $19.8 million in available reserves by the end of June 2014.
"We are extremely proud to once again approve a balanced budget and could not have done this without the hard work of our City Council and city management team," said Mayor Mario Guerra in a statement.
"Our city continues to remain in stable financial condition, which is very difficult to do during tough economic times and I want to sincerely thank my fellow council colleagues, city manager Gilbert Livas and his dedicated staff for making this possible for our city."
********** Published: June 20, 2013 - Volume 12 - Issue 10