PLEASANTON -- A diverse tax base, smart planning and a recovering economy is the winning recipe that has yielded sunny projections for the city's proposed two-year budget, which council members will consider adopting Tuesday.

Emily Wagner, Pleasanton's director of finance, said in a recent council presentation that general fund revenue is expected to rise next year about $1 million, reaching $92.4 million in fiscal year 2013-14. Revenue is projected to hit $94.5 million the following year, which would be the city's fifth consecutive year of growth while maintaining a balanced budget.

City officials say another factor helped bring the city to such a positive destination: cautious spending.

"Pleasanton is in good financial shape and our position is envied by communities around the bay," said City Mananger Nelson Fialho said. "But we acknowledge there is more work to do, and we need to manage well the bottom line -- the city's expenditures -- so that our expenditures don't grow."

A good example of that, Fialho said, is the city's golf course, which opened in 2005. Pleasanton issued $26 million in debt to construct the course. Nearly a decade later, Pleasanton still had 15 years left on its payment plan but decided to retire the debt with a lump-sum payment next year. That will save taxpayers about $10 million in interest, and will free up about $1.3 million that can be spent annually on other city projects, Fialho said.


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Once the golf course payment is made, Pleasanton will be debt free for the first time since the 1960s. "The fact that we're getting rid of all our debt is pretty amazing," Vice Mayor Cheryl Cook-Kallio said. "I don't know of another city that's doing that."

An uptick in new development is another cause for optimism. Fialho cited the recent construction and full occupancy of the Pleasanton-Gateway Plaza shopping center. Also, Workday Inc. is planning to build its international headquarters in town, quadrupling its workforce to 4,000 employees, making the software giant Pleasanton's largest employer.

"Those kinds of economic activities point to a rebounding economy while positioning Pleasanton for future revenue growth," Fialho said.

Mayor Jerry Thorne credited the city's diverse revenue sources for enabling it to weather the tough times and lead the charge for what appears to be a resurgent local economy. "We have business parks, retail that generates sales tax and auto dealers, and the property tax base stayed stronger than most cities," Thorne said.

But that doesn't mean the city expects to go on a spending spree, the mayor said.

"The budget looks pretty doggone good right now," he said. "But one thing we've learned is that things can take a turn for the worse in a hurry."

Contact Chris De Benedetti at 510-353-7011. Follow him at Twitter.com/cdebenedetti.