On Tuesday, the Sebastopol City Council approved a mid-year budget adjustment, which will once again draw from the city’s General Fund reserves to make up budgetary shortfalls caused primarily by the pandemic.
This marks a third general fund deficit faced by the city in the budget year, which began with a $1.54 million shortfall on July 1, 2020. The city uses mid-year budget reviews to reassess budgetary needs by departments throughout the city fiscal year, which will end on June 30 of this year.
At a prior mid-year review in October of last year, the council voted to dip into the reserves a second time to cover an additional $2.19 million budgetary shortfall. The recommendations for increased spending were assessed by the budget subcommittee, which includes Mayor Una Glass and Council member Neysa Hinton, and are based on meetings with individual departments to assess their budgetary needs. Overall, the General Fund deficit for which the city will have to pull from reserves this time is $1.78 million. That brings the total budgetary deficit faced this year to $5.51 million.
The deficit of $1.78 million includes a 1.52-percent increase in expenditures at mid-year but is largely associated with reduced revenue.
City revenues, such as sales tax and other fees associated with economic growth and development, have fallen with the devastating impact the pandemic has had on local economies. Because of a 90-day federal extension on the payment of sales tax by businesses early on in the pandemic, city financial planning staff have had difficulty calculating the projected revenue for the year, especially given the broader economic uncertainty associated with pandemic-related lockdowns.
Financial Director Ana Kwong told council members and the public that her department chose a conservative approach to deal with the uncertainty around sales tax revenue. However, Kwong said the consultants the city has relied on for decades to assist with financial planning have reliably predicted an increase in levels of sales tax revenue as the year progresses.
The overall increase to mid-year revenue is 6.84 percent, including the major increase in the sales tax forecast, as well as a minor positive adjustment to property tax revenue. Despite the increase, the staff report details that sales tax revenue continues to be “nowhere near” pre-pandemic levels and recommended a continued conservative approach.
Among the requests for increased funding approved in the mid-year budget review are the following:
-The planning department requested an additional $60,000 to begin work with a consultant on the 2023 Housing Element, an aspect of the General Plan required to be updated in eight-year cycles to ensure adequate provision of housing based on income levels. The completion of the Housing Element is tied to critical state funding mechanisms for cities.
-The Fire Department requested $175,000 to replace an older fire engine used to combat wildfires with a newer, safer model, with funding coming from the city’s vehicular fund, which includes a $205,000 grant received from California Office of Emergency Services (Cal OES).
-Public Works requested $43,000 to install portable hand washing stations in public restrooms to assist in Covid-19 prevention.
The most controversial item on the budget review were requests by Interim Police Chief Donald Mort for the following major items: $60,000 for legal counsel associated with a pending civil lawsuit against the department, and a $150,000 increase to fill staffing vacancies. Mort said that because of staffing problems since he took over the department last fall, the department is running with approximately 60-75 percent of full staff. Mort emphasized that the funding did not amount to increasing policing staff, but instead returning the department to normal levels.
The Sebastopol Police Department has traditionally employed 14 sworn officers, with at least two always on the clock. With staff reductions—including periodic Covid-19-related quarantines, injuries and regular time-off requests—the police department has not been able to staff an additional third officer during busy times. Similarly, current officers have been required to work extensive over time, which is more costly for the city in the long run.
In addition to its patrolling officers and administrative employees, the Sebastopol Police Department employs five full-time dispatchers and a police aid who assists with parking and citizen complaints, for a total of 20.75 full-time equivalent (FTE) employees. The department is also assisted by four reserve officers, paid by the shift, and four unpaid civilian volunteers.
Sebastopol citizen and vocal critic of police services expenditures in Sebastopol said that Sebastopol spends more per resident than any other Sonoma County incorporated municipality, in an interview The Voice. Prior to the mid-year review, police services were $5.1 million of the $10.6 million City of Sebastopol budget, with around 47 percent of the total budget afforded to police series.
During a public comment at the meeting, Falbo said that the mid-year review would raise the police expenditures to 49 percent of the city’s total budget and lamented the prospect that that number could soon eclipse half of the total budget.