Published on June 23,
No layoffs in Richmond's approved budget
By Katherine Tam
Contra Costa Times
More than a dozen layoff notices have been rescinded and some
proposed cuts restored in the balanced budget Richmond city
leaders passed early Wednesday morning for next fiscal year.
A recent deal with the Chevron refinery will bring the city
$10 million in 2010-11, enough to avert serious budget cuts.
The City Council early Wednesday adopted a $427.4 million operating
budget, including $131.5 million in the general fund and about
$8.5 million in reserves.
The city and employee union negotiated a two-year contract
extension without a cost of living increase, and workers agreed
to take the last week of December off so officials can close
City Hall to save money.
The downturn in the housing market and the recession have
forced the city to cut back the last couple years. Officials
shed 92 positions since last summer, mostly through early retirements,
attrition and six layoffs, City Manager Bill Lindsay said.
Officials are relieved they did not have to resort to major
layoffs like other cities, they said. And Richmond's credit
rating remains strong.
Still, Councilwoman Ludmyrna Lopez warned that officials must
find stable revenue, and budget within what they can reasonably
expect to generate annually to avoid future deficits. Officials
should think twice about creating new positions during a prosperous
economy, if they may have to cut those positions and lay off
workers in lean times, she said. And the city should not tie
its survival to short-term revenue sources such as tax settlements
or proceeds from a land sale.
"It's our responsibility to make sure that we're living
within our means," Lopez said during budget deliberations
this month. "We can't just hope on these one-time deals
that we're doing. We have to be very careful about what is
that sustainable level of revenue that we can rely on year
The city ended the last couple fiscal years in a deficit and
tapped the reserve to balance the budget, she said. At Lopez's
suggestion, the council finance committee will meet to craft
a new policy in which city staff would seek council authorization
before withdrawing money from the reserve.
Last month's tax deal with Chevron brings $114 million in
new money to Richmond over 15 years. Chevron will pay utility
taxes as required, plus $4 million to $13 million a year under
a set schedule for the life of the agreement.
In addition, the city and Chevron killed competing November
ballot measures. The city's measure would have eliminated a
method for calculating utility taxes that the city said Chevron
used to pay less than it would have if it had followed a 10
percent formula other ratepayers use. Chevron's counter-initiative
would have kept the refinery's payments about what it is now
while cutting taxes for others.
The city abandoned its appeal of a December superior court
ruling that invalidated the 2008 voter-approved manufacturers
fee. The city refunded fees Chevron paid while the lawsuit
was pending; the oil company waived $1.2 million in interest.
Other budget cuts that were restored in the 2010-11 budget
include maintenance for the Shotspotter gunshot detection system,
public art money for nonprofit groups, and funding for the
North Richmond Shoreline Festival and the July 3rd festivities.
Katherine Tam covers Richmond. Follow her at Twitter.com/katherinetam.