RIPON - Staff cuts and a possible sales tax boost are on the table to prop up the ailing city general fund in Ripon that has been dipping gravely into the city’s reserves to make payroll.
A sales tax increase of as much as one cent that could bring in some $2 million is being considered in the midst of the city’s current million dollar-plus budget crisis where council members are expected to lay off 13 employees in the coming weeks.
Mayor Chuck Winn explained earlier that some 70 percent of the current sales tax revenues come from non-residents who are passing through with most of them buying gasoline at the Jack Tone interchange businesses.
An alternative to upping the sales tax would be a general property tax to put money into the general fund, which must be approved unanimously by the full city council. The general tax requires a 50 percent vote of the electorate where a sales tax nod calls for a two-thirds majority.
Winn said he would opt for just a half-cent sales tax however, noting that a sales tax initiative can only be put on the ballot along with a city council election that won’t occur until November.
While the city has voted unanimously to sideline 13 employees from the police to the parks departments, it is not clear exactly what positions are going to be vacated until select tenured employees decide whether to take a golden handshake into retirement.
Mayor Winn added that he believes further layoffs will also be necessary. He noted that thinning the ranks at city hall has not been an easy process with a goal to maintain city services.
Potentially three workers are scheduled for pink slips in the Public Works Department along with six from the ranks of the Police Department and four from Administration. There will be severance pay offered to those employees amounting to as much as six weeks’ pay depending on the individual staff member’s length of service with the city.
Winn stressed that other sources of income need to be discovered to keep the city from continuing to put a drain on the city reserve funds for day-to-day operations. The city has already used more than $1.3 million from its reserves. The city council has agreed to cut $100,000 each month from the city services equating to $1.2 million in one year.
City Attorney Tom Terpstra pointed out that the proposed hotel tax increase now being considered is one form of new revenue that would need to be placed on the November ballot. He noted that currently the tax is set at 10 percent and could possibly go a little higher; saying not a great deal of revenue can be gleaned from that tax in Ripon.
Councilman Charlie Gay has opined that the city needs to look at other sources of income such as big box stores including the Walmart effort to locate in Ripon. It is a store that would have brought sales tax revenues into Ripon.
Gay said that the location Walmart wanted was not good. The councilman said that “things are different now – everything is on the table.” He said that he feels the people of Ripon are not ready to endorse a tax or any raise in fees, suggesting that the city fathers need to look at any proposal by a developer. “Maybe the city can collect the fees in a staggered manner,” he said.
Gay noted that one reason the council has delayed making a decision is that the numbers keep changing. Winn said recently that the budget projections have been slowly moving upward based on trends that appear to be starting to catch up with the deficit.
City Administrator Leon Compton pointed out the general fund reserve account had dropped to $1.9 million as of the end of October. He explained that there is $785,000 that had been transferred out of the general fund that could be transferred back. The only other option to move funds would come from the General Mitigation Fee that contains about $5.4 million. Some $4 million was used to pay for the new city hall complex, but $1.5 million could be transferred into the general fund with council action.
Another problem for the city comes from underwriting its own unemployment benefits. The payout on a $30,000 salary amounts to $18,000.
The city has already increased the rental fees for the community center and the recreation program. City employees have also been given more furlough days off with every department working to cut costs. The contributions to the library, the swimming pool and the school crossing guard will not be adjusted until the next budget.
Mayor Winn said the determination as to which employees will be laid off relates directly to what will be the maximum benefit to the city.
The Public Works Department currently has eleven employees to care for nearly 20 parks on 90 acres of land. Those workers also service Mistlin Sports Park and another 15 acres at the Jack Tone Road interchange. Mayor Winn said they may have to mow the grass on a delayed schedule, close three or four parks and close half the tot lots. “We may also have to dedicate the Jack Tone area to Caltrans,” he said.
Councilman Garry Krebbs had told councilmen at the December meeting that he felt enhancing the revenue would do nothing for the current problem. “There is no big box store being built anywhere now. Any new money coming in won’t be seen until the later 2010 or 2011. What do we do to make payroll in 2010?” he queried.
A sales tax increase of as much as one cent that could bring in some $2 million is being considered in the midst of the city’s current million dollar-plus budget crisis where council members are expected to lay off 13 employees in the coming weeks.
Mayor Chuck Winn explained earlier that some 70 percent of the current sales tax revenues come from non-residents who are passing through with most of them buying gasoline at the Jack Tone interchange businesses.
An alternative to upping the sales tax would be a general property tax to put money into the general fund, which must be approved unanimously by the full city council. The general tax requires a 50 percent vote of the electorate where a sales tax nod calls for a two-thirds majority.
Winn said he would opt for just a half-cent sales tax however, noting that a sales tax initiative can only be put on the ballot along with a city council election that won’t occur until November.
While the city has voted unanimously to sideline 13 employees from the police to the parks departments, it is not clear exactly what positions are going to be vacated until select tenured employees decide whether to take a golden handshake into retirement.
Mayor Winn added that he believes further layoffs will also be necessary. He noted that thinning the ranks at city hall has not been an easy process with a goal to maintain city services.
Potentially three workers are scheduled for pink slips in the Public Works Department along with six from the ranks of the Police Department and four from Administration. There will be severance pay offered to those employees amounting to as much as six weeks’ pay depending on the individual staff member’s length of service with the city.
Even more layoffs may be necessary
The mayor further explained that before any layoffs take place another session will be held with the various bargaining units. He reiterated the fact that more layoffs may be necessary if the primary cuts are not enough monetarily to reduce the red ink.Winn stressed that other sources of income need to be discovered to keep the city from continuing to put a drain on the city reserve funds for day-to-day operations. The city has already used more than $1.3 million from its reserves. The city council has agreed to cut $100,000 each month from the city services equating to $1.2 million in one year.
City Attorney Tom Terpstra pointed out that the proposed hotel tax increase now being considered is one form of new revenue that would need to be placed on the November ballot. He noted that currently the tax is set at 10 percent and could possibly go a little higher; saying not a great deal of revenue can be gleaned from that tax in Ripon.
Councilman Charlie Gay has opined that the city needs to look at other sources of income such as big box stores including the Walmart effort to locate in Ripon. It is a store that would have brought sales tax revenues into Ripon.
Gay said that the location Walmart wanted was not good. The councilman said that “things are different now – everything is on the table.” He said that he feels the people of Ripon are not ready to endorse a tax or any raise in fees, suggesting that the city fathers need to look at any proposal by a developer. “Maybe the city can collect the fees in a staggered manner,” he said.
Gay noted that one reason the council has delayed making a decision is that the numbers keep changing. Winn said recently that the budget projections have been slowly moving upward based on trends that appear to be starting to catch up with the deficit.
City Administrator Leon Compton pointed out the general fund reserve account had dropped to $1.9 million as of the end of October. He explained that there is $785,000 that had been transferred out of the general fund that could be transferred back. The only other option to move funds would come from the General Mitigation Fee that contains about $5.4 million. Some $4 million was used to pay for the new city hall complex, but $1.5 million could be transferred into the general fund with council action.
Another problem for the city comes from underwriting its own unemployment benefits. The payout on a $30,000 salary amounts to $18,000.
The city has already increased the rental fees for the community center and the recreation program. City employees have also been given more furlough days off with every department working to cut costs. The contributions to the library, the swimming pool and the school crossing guard will not be adjusted until the next budget.
Mayor Winn said the determination as to which employees will be laid off relates directly to what will be the maximum benefit to the city.
The Public Works Department currently has eleven employees to care for nearly 20 parks on 90 acres of land. Those workers also service Mistlin Sports Park and another 15 acres at the Jack Tone Road interchange. Mayor Winn said they may have to mow the grass on a delayed schedule, close three or four parks and close half the tot lots. “We may also have to dedicate the Jack Tone area to Caltrans,” he said.
Councilman Garry Krebbs had told councilmen at the December meeting that he felt enhancing the revenue would do nothing for the current problem. “There is no big box store being built anywhere now. Any new money coming in won’t be seen until the later 2010 or 2011. What do we do to make payroll in 2010?” he queried.
