Tag Archives: Berkeley city budget
Berkeley’s City Council on Tuesday night received the first biennial report on the city’s long-term liabilities. The detailed breakdowns in the report from city budget manager Teresa Berkeley-Simmons make clear that the main areas with significant liabilities are police pensions, maintenance of city facilities, and watershed and storm drain maintenance and improvements.
Speaking about the presentation of the report, Berkeley City Manager Christine Daniel said she hoped the Council would agree that budget reporting was improving generally and that the council members’ feedback would contribute to even more enhancements. She said the genesis of the current report could be traced back to 2005 when staff produced a report on employee benefits, then in 2008 when staff started putting information about unfunded liabilities in the budget document, and finally in the fall of 2011 when presentations were made on the status of capital assets and infrastructure. … Continue reading »
Berkeley’s General Fund projections include a deficit of more than $5 million over the next two years, requiring city leaders to take a tough look at its more cash-strapped departments to reign in costs.
To close the gap, the city’s budget manager has recommended recurring 2% General Fund reductions across the board for city departments. Departments will present their recommendations to the city manager and City Council in the coming months.
In a work session last Tuesday night, the city’s budget manager gave Berkeley City Council members a forecast for the next two years, and pointed to areas that may pose challenges going forward. (See a PDF of her presentation.)
Three more work sessions have been planned to allow council members, city staff and members of the public to learn more about, and weigh in on, city finances. Scroll to the bottom of this story to see the dates for upcoming public meetings on the budget.
Last October, Berkeley held a Sunday Streets event for the first time, and an estimated 40,000 people flocked to Shattuck Avenue to stroll, bike and skate the length of 17 blocks enjoying the car-free environment, al fresco eating, music, yoga and chess playing. By most accounts, the event was a success, but to make it happen again this year and going forward, the organizers are asking officials to stump up the funds to cover city costs.
At Tuesday’s City Council meeting, officials expressed their support for the event, but were hesitant, given Berkeley’s tight budget, to commit to the full amount needed to cover city costs for a 2013 repeat performance, as well as funds for future years. They also said they were uncomfortable making financial decisions separate from the context of the rest of Berkeley’s events. … Continue reading »
City staff were “overly optimistic” in budget projections for the fiscal year that ended in June, but Berkeley’s General Fund still ended up several hundred thousand dollars in the black for 2011-12, the city manager told council members Tuesday night.
City Manager Christine Daniel told the Berkeley City Council that “exceptional expenditure control” allowed the city to end the fiscal year without a General Fund shortfall that had been projected to hit $1.9 million.
“Everybody managed very carefully and that’s how we managed to end the year in that way,” she said Tuesday night during a special session on the Berkeley city budget that took place prior to the regular City Council meeting. … Continue reading »
Moody’s Investor Services, one of the two dominant bond ratings companies, announced on Tuesday that it was reviewing the ratings of 32 California cities, including Berkeley. Three issuances by Berkeley are under review by Moody’s: the $28 million 2003 certificates of participation, the $5.8 million 2010 animal shelter financing, and the $9.1 million 1999 lease revenue bonds.
Refinancings were recently agreed on both the 2003 and 1999 issuances, with new AA ratings from Standard & Poor’s. According to City Finance Director Robert Hicks, both of the refinancings will be completed before the Moody’s review. That is likely to mean that only the $5.8 million animal shelter financing, currently rated Aa3, will be subject to review.
According to David Jacobson, a spokesman for Moody’s, the overall economic and legislative climate in California triggered the reviews.
“The factors here don’t apply just to Berkeley,” he said. “Over the last few years, California municipalities have been through interesting developments. There have been three bankruptcies. Over 50 have declared fiscal emergencies. We reanalyzed all the 90 cities in California that we rate. We determined that there were about 30 where we decided to place the rating on review and decided to just make sure they were rated appropriately.” … Continue reading »
The interior of Jacquelyn McCormick’s Berkeley hills home looks like it could be in the glossy pages of a lifestyle magazine.
An enormous mirror reflects the image of visitors who walk into the entry hall of the house, the remnant of the four-acre Henry Taylor estate that once sprawled across the ridge. To the right is a spacious living room (a former ballroom in the estate’s heyday), with a large fireplace, a comfortable seating arrangement, a grand piano, and art work done by McCormick’s stepdaughter, Alexandra Salkin.
The fact that the interior of McCormick’s home is arresting isn’t so surprising, given that she became an interior designer in 2002 after a long career managing commercial real estate for banks. What’s surprising is that McCormick, 58, has done much of the work on the house herself.
When she and her husband, Michael Salkin, a former UC Berkeley economist turned portfolio manager for Morgan Stanley, bought the house on The Uplands in 2004, it was a mess. The house hadn’t been touched since the 1930s and there was six inches of standing water in the basement. McCormick got busy. She painted the living room walls and fireplace with a lime wash, which produced a pleasing variegated effect. She found a bathroom console at Omega Salvage and put the legs on herself. She added molding to the kitchen and installed a slate mosaic around the stove. … Continue reading »
Barbara Gilbert argues that in an effort to get more revenue to support Berkeley’s “bloated” City structure and its developer friends, City Council is strong-arming a drastic up-zoning of West Berkeley that would destroy a thriving and unique residential/artisan/artist district as well as destroying Aquatic Park. Continue reading »
A ballot initiative to force the city to do biennial reports on obligations for employee and retiree expenses and for Berkeley’s physical infrastructure and capital assets appears likely to appear on the ballot in the November election, according to supporters of the plan. At the same time, at tonight’s City Council meeting a similar measure is being proposed by four councilmembers, led by District 5′s Laurie Capitelli. The council measure, however, lacks the penalties for failing to produce the report that the initiative draft contains.
The ballot initiative is called the Berkeley Fiscal Accountability, Clarity, Transparency and Sustainability Ordinance of 2012, which shortens to FACTS. It would require biennial reports on the city’s financial obligations for the next 20 years, and would prohibit the City Council or the voters from “incurring any debt financing, or imposing any new tax, assessment or property-related fee, or increasing any existing tax, assessment or property-related fee, or scheduling an election to impose or increase and tax, assessment or property-related fee” unless the report required in the ordinance has been published and certified. … Continue reading »
The City Council heard a sobering report from outside actuary John Bartel at its special meeting on Tuesday night this week.
“I wore my Valentines Day tie, but that’s unfortunately the only good news I have here,” Bartel said. “Your contribution rate will not be going down. It will actually be going up in the future.”
The council has had a number of presentations on the unfunded pension liabilities in the last year. On Tuesday, Bartel explained that the actuarial target he was encouraging the city to meet was to reach 100% funding of the liabilities “over a reasonable period of time”.
But the difficulty of achieving that was highlighted by the figures Bartel presented. For the police safety plan — overwhelmingly the largest cost and the largest unfunded liability for the city — the city is currently paying 42% of salary in pension contributions. To reach a target of 80% of the liabilities funded in 20 years, Bartel said the city contribution would have to rise to 50.7%. To reach 80% funded in 10 years, the contribution would climb to 61.5%. … Continue reading »
Last night Berkeley’s City Council voted unanimously to review its banking arrangements with Wells Fargo when the current contract expires at the end of 2012.
This followed a recommendation by councilmembers Jesse Arreguín and Darryl Moore to consider alternatives to the 160-year-old San Francisco bank which, they said, “was a key part of the subprime lending crisis which led to our overall economic collapse”. (View the responsible banking policy Council item.)
Berkeley’s FY11 city budget is about $324 million, and bank deposits are around $10 million, according to a local banking executive. Berkeley has banked with Wells Fargo since 2004 and the contract was last renewed in 2009. … Continue reading »
Phil Kamlarz, city manager for eight years and a city employee for 36, retired this month. He first became a Berkeley city employee as a temporary associate accountant in the Berkeley Public Library in 1975, and a year later transferred to the city manager’s office. He became assistant city manager in 1987, and then acting city manager in 2003, before getting his full appointment the following year.
Two weeks ago, when the City Council marked Kamlarz’s retirement, the encomia from councilmembers were effusive. Mayor Tom Bates noted that Kamlarz “has provided Berkeley a platform of fiscal stability which is enviable”. He cited Kamlarz as a “calm, collected leader” with “compassion, foresight and a good nature”. … Continue reading »
The city could achieve annual savings in excess of $4 million, if an agreement reached this week with more than 500 city employees on salary cuts and pensions is also adopted by other union members, according to City Manager Phil Kamlarz.
The agreement, announced at Tuesday’s City Council meeting, was made with members of the Service Employees International Union (SEIU) 1021, the city’s maintenance and clerical workers, and it will go some way to alleviate Berkeley’s $12.2 million budget deficit.
In agreeing to cuts in salary increases that had already been agreed upon, and to a two-tier pension system, SEIU members also prevented layoffs among its members. The city has said it would have to make about 79 job cuts in order to reduce costs. The new agreement, which has also been signed by a number of non-represented workers, includes provisions for early retirement, said Kamlarz. … Continue reading »