EL CERRITO -- The City Council received a clear message during a June 9 budget study session that nothing has changed in the need to reduce costs or raise more revenue to improve the perilous state of city finances.

City Manager Scott Hanin laid out a pair of bare-bones budgets for the next two fiscal years during the session, but council members had little to add about how to improve the situation.

Plans for 2014-15 call for keeping 15 positions unfilled, five more than this year, out of 173 approved by the council across all departments, amounting to a 16 percent cut in staffing since 2009.

Although public safety was identified as the most important priority in a series of community meetings on the budget earlier this spring, three of the positions held vacant will be for police officers.

Three fire department openings will be covered by firefighters on overtime for an annual savings of $150,000.

Simultaneously, the city's reserves have dwindled to an estimated 5.1 percent of its annual budget, despite plans to increase reserves to 10.3 percent in the proposed 2013-14 budget adopted a year ago, amounting to a difference of about $1.5 million.

The city's proposed general fund budget for 2014-15 is $29.52 million rising to $30.39 million in 2015-16.

Hanin said he is projecting no increase in reserves and no general fund revenue for reinvestment in the city's infrastructure, including parks, playing fields and public buildings in the next two years.


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On the positive side, the city is anticipating a $1.1 million increase in property and sales tax revenues over two years, partly as a result of reassessments of properties that had been valued downward under state Proposition 8 during the recession.

The council will consider approving a final budget at its June 17 meeting, although a vote could be put off until June 24 or even June 30.

Hanin held out the possibility of putting a measure on the November ballot to extend and increase Measure R, a seven-year, half-cent sales tax passed in 2010.

The tax was intended to bolster a host of city services, including fire, police, and after-school programs for children, parks and recreation and services for seniors.

Hanin estimated that an enhanced Measure R could yield an extra $300,000 to $400,000.

He recommended the city use the money to increase reserves by about 1 percent a year toward realizing the stated goal of maintaining reserves of 10 percent to 15 percent.

The council appeared receptive to the idea of going to the ballot again to address the crisis.

"We don't like living on the margins like this," said Councilman Mark Friedman. "We need some new revenue commitments that will require collective action by the community."

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