CLAYTON -- There was cause for cautious optimism when city Finance Manager Kevin Mizuno presented a $9,366,506 budget for the fiscal year 2014-2015 at the June 3 City Council meeting.
By June 13, Mizuno was able to adjust the projected general fund surplus up to $39,000.
As a testimonial to Mizuno's competence, City Manager Gary Napper chose to delegate the budgetary presentation for the first time in his 33 years as a manager. Council members endorsed Napper's decision.
"I was extremely pleased with the amount to of detail (in the budget presentation), and it was easy to understand," Councilman David Shuey said later. "It was awesome."
Conservative money management appears to have put Clayton in a better position than many cities that are still struggling to balance annual budgets and restore pension reserves.
"We are definitely moving in the right direction," Mizuno said. "We still have two staff furloughs, but in 2013 we had 11."
Clayton's CalPERS costs show a steady decline from $547,220 in 2012-2013, to $464,914 projected for 2014-2015. Also, the cost of unfunded liability for "classic" longer-term employees has been dropping at slightly more than $100,000 annually over the past three years.
"That is because some of the long-term employees are retiring or leaving for other jobs," Mizuno explained.
For example, Clayton's police chief recently went to work for the city of Moraga, and the previous city manager retired in 2013.
CalPERS has a tier system where the oldest employees (tier 1) joined the system when municipalities paid the total cost of pension contributions. In recent years, tier 2, and then tier 3 have been established. Tier 3 employees pay half of the pension contributions, according to Mizuno.
The complete city of Clayton budget will be on the city website between June 16-20, and there is a projected reserve of 131 percent of next year's budget, according to Mizuno.
"The good news is that the back audits are now behind us and we only have the cost of the normal audit," Mizuno noted.
"We are seeing a modest return of the economy, at least in Clayton and Contra Costa. Sales taxes and property values are beginning to return to more reasonable levels after the Great Recession," Councilman Jim Diaz observed.
Diaz also said he pleased with the way the city manager and the staff has stayed close to budgeted amounts, putting Clayton in good condition compared to financial difficulties facing other municipalities.
During the 2013-2014 fiscal period, the city has been able to fund eight capital improvement projects that have been on the back burner, including paving projects, trail maintenance and an HVAC replacement for Clayton's library.
Vice Mayor David Shuey continues to counsel caution.
"I remain pessimistic and conservative in terms of our overall outlook," he said. "We appear to have weathered the storm, but we need to keep an eagle eye."
And Shuey echoed council sentiments about financial management.
"The council and the city staff have been very conservative in the past, and we need to continue (to do so)."
Contact Dana Guzzetti at firstname.lastname@example.org or call 925-202-9292.