Concord OKs balanced budget but sees cloudy days ahead

The Concord City Council approved a balanced biennial operating budget at the June 11 meeting – but only by dipping further into General Fund reserves and using more Measure Q funds.

In one of his longest statements since being elected last fall, Councilman Dominic Aliano summed up the city’s dire long-term forecast. “It’s not a sexy time to be a council member, because this budget is really scary,” he said. “We’re dipping into reserves and if we do not watch what we’re doing, we could put the city of Concord in a terrible position for the future financially.”

Expenditures for Fiscal Year 2019-’20 are budgeted at about $108.2 million, with a deficit of $3.8 million. FY 2020-’21 projects a $1.3 million deficit out of $110.8 million. Budget officer Donna Lee said filling the gap reduces reserves to 23 percent.

“The city is maintaining General Fund reserves above the minimum 17 percent threshold set in the city’s budget and fiscal policies,” Lee told the council. “However, the goal is to maintain reserves at 30 percent, and we do have significant funding challenges ahead.”

On June 11, the council unanimously approved an amendment to the Fiscal Sustainability Ordinance to allow the city to use more than $8 million annually from the Measure Q half-cent sales tax to support operations.

At a May 14 budget workshop, the council discussed plans for renewing Measure Q, which expires in 2025. Greg Grassi said the Measure Q Oversight Committee recommends putting a one-cent tax on the November 2020 ballot.

“We commend the City Council for establishing the Sustainability Ordinance. But it’s obvious to all of us that the bigger problem is there isn’t enough money to go around,” he said. “The economy’s taken much longer to recover than what we would have liked, and Measure Q dollars are still necessary.”

At both the May 14 and June 11 meetings, council members reiterated the need for community outreach about the long-term budget forecast. They asked staff to bring specific ideas back for review.

Meanwhile, the council voted 3-2 to give themselves a raise of 3 percent for each of the next two years, non-compounded, to be effective after the 2020 election. The raises bring compensation to $1,433.12 a month.

At the May 14 workshop, however, council members tabled a proposed to add a part-time council scheduler. Mayor Carlyn Obringer and Councilman Tim McGallian said there has been a huge increase in calls and emails from residents due to the change to council districts.

But the council wasn’t ready to give up on adding a sixth Code Enforcement officer and directed staff to provide more information on options.

Obringer noted that 27 percent of the budget comes from property taxes. “If we want to maintain and increase those property values and property taxes, code enforcement is critical,” she said.