The Chino Valley Town Council learned Tuesday that the town is facing a $1.26 million deficit in its general fund for 2010-2011.
Judi Schafman, Administrative Services director, revealed this information during the town's first 2010-2011 budget workshop.
She said this means no salary raises for the town's employees. "We will continue the 10 percent salary cut and furloughs," she said. This means the town will stay on a four-day workweek.
Schafman said the employee benefits budgets could increase by as much as 14 percent.
"We should know how much the retirement budget increases by January or February," she said. She hopes the town will know something about health insurance premiums about the same time.
State officials, she said, have notified the town's financial department that the State Shared Income Tax the town receives will be 24.6 percent less than original estimates. Originally, state officials said to expect a 10 percent cut. The 24.6 percent reduction means a loss of $391,440 to Chino Valley, Smith said.
Currently, Schafman said, the town expects a 10 percent decrease in vehicle license tax and State Shared Sales Tax from this year.
She also expects the town sales tax will be down 10 percent.
Schafman said the savings from the general fund accounts won't be as great this year as they were last year because most of it was from salary cuts.
"We need to start looking at additional budgetary cuts," she said.
Some budget strategies Schafman urged the council to implement include:
• Using the estimated 2008-2009 general fund carryover of $500,000 to help balance the budget.
• Preserving this year's general fund contingency and reserve budgets.
• Limiting this year's general fund expenditures whenever possible.
• Carrying forward any 2009-2010 general fund carryovers.
Finance manager Vera Smith gave the council a rough timetable of what steps the town goes through to develop a budget and when.
She reminded the council that, four months into the current fiscal year, the state still doesn't have a balanced budget. "We still don't know if it is going to take some money back from us this year," Smith said.
By the council's February 2010 budget workshop, she hopes to know more about what the state revenue picture looks like and whether most of the impacts will be to the 2010-2011 budget.
Smith said the council must make sure the town continues to build up its reserves. Each year it costs Chino Valley about $1 million to pay its debt payments. She said the water rights acquisition payment of $727,390 is due in December 2010. Therefore, the fund will need more money in it next year to meet debt payments.
Smith said if the town doesn't start building up its reserves, it may be in trouble when it comes time to pay the debt payment in 2011-2012.
The town, according to Smith, needs to update its Capital Improvement Plan. The town last revised it in 2007-2008. "It should be realistic and funding must be in place for projects before you can spend it," she said.
Also, the town is supposed to have a five-year plan. For the past two years, she said, the town has had a three-year plan. "It is hard enough to do three years because of the economy," she said.
She said the town is going to need all the help it can get next year.
Vice Mayor Ron Romley said the mayor, who was absent, and the council would like to hear from Chino Valley's residents on what cuts they think the council should make in the 2010-2011 budget.
Reader Comments
Posted: Sunday, November 08, 2009
Article comment by:
Patrick
Where is Bill Pupo when you really need him? I bet you he could right this thing.....
Posted: Sunday, November 08, 2009
Article comment by:
No name provided
This is no surprise at all and anyone could see it coming. It is time to dump the town engineer or he will take all of us down with him. The town has shown no fiscal responsibility in the planning, construction, and expansion of the sewer collection system. The numbers do not work, yet the Town just keeps pushing on digging the hole we are in deeper and deeper. On top of that is the obsession to buy up all the water companies and charging the citizens twice as much to pay for it. This is insanity, so just stop already. Maybe he needs to be out looking for a job in order to get the picture.
Posted: Sunday, November 08, 2009
Article comment by:
azlaydey
Cut the Administrators and Managers pay! They are over payed for the work they do!
Posted: Sunday, November 08, 2009
Article comment by:
tired
I can only imagine how much more in debt Chino Valley would be if they had to maintain all of the dirt roads in the area. Someone is cooking the books somehow.
Posted: Sunday, November 08, 2009
Article comment by:
Patrick
This is not good. Its sinking, the writing is on the wall. Rats are even jumping off ship.
