It will cost $507 per Manteca resident in 2010 to provide municipal services.
That means Manteca will have a balanced budget barring any more state thievery of local dollars. And it was done by employees – excluding sworn police officers – taking a 20 percent reduction from previously negotiated compensation with the bulk being saved through forgoing 5 percent pay increases in 2010 and 2011.
Only two of the eight cities Manteca compares itself with do it for cheaper – Turlock at $414 per capita and Modesto at $506 per capita.
But as City Manager Steve Pinkerton has noted, Manteca is fairing even better in the low-cost department since unlike most cities in the survey it is a “full service” city not only providing fire and police services which some jurisdictions contract but has kept garbage collection – the one service that’s typically contracted out – in house.
Manteca now is running with per capita expenses that are near the level in 2006 when there were 6,000 less residents and municipal services cost $484 per capita to run. They climbed to $559 per capita in 2007 that included the first six months of a four-year labor contract with the city’s bargaining groups that had built-in raises and then hit $559 in 2008 and dropped slightly to $555 in 2009. The 2009 figure reflected the decision to start leaving positions vacant when people retired or resigned in anticipating of dropping revenues.
Projections call for 69,200 residents in 2011 with per capita income of $394 versus per capita expenses of $536, Then in 2012 per capita revenue is expected to bounce up slightly to $397 while per capital expenses continue to climb to $542.
Personnel costs including salary are roughly 85 percent of the budget. Based on a reduced city staff that includes forgoing negotiated wages or – in the case of police 12 less positions – for the next two years along with spending down the reserves, Manteca was able to eliminate a $14 million deficit that they faced at the start of the current fiscal year that began July 1.
However other expenses such as electricity continue to climb. The expense projection anticipates hiring more people to meet the demands of growth but in reality the city will likely opt to do even more with less staff.
Revenue could also go higher if cost recovery proposals are put in place in the coming months. While some fire department cost recovery charges that could generate $60,000 plus in a year have already been adopted, the major ones that impact costs associated with planning for growth have to be verified by an exhaustive study known as a matrix to meet state legal requirements.
In an October presentation to the business community, Pinkerton noted that labor costs were the major factor in the city’s financial situation.
He pointed out:
• the majority of the budget gap was due to double digit annual increases in labor costs.
• those additional costs were due partially to increasing staffing to keep up with population.
• that increasing pension payments and health premiums contributed to the problem.
• labor contracts in comparison cities have put upward pressure on overall compensation.
That isn’t expected to impact recruiting and keeping good employees over the next few years due to the state’s 12.2 percent unemployment rate.
The city took the stance that dropping revenues meant dropping employee compensation as well. They have also been guided by a need to maintain services which mean they couldn’t make all of the cuts through salary reductions.
After target numbers were set to make sure the budget deficit could be bridged, employee groups were given the option between layoffs within their groups or compensation reductions.
Furloughs resulted in a 3.8 percent across the board cut. All groups except for the police officers agreed to increase payments toward their own pensions and forgo cost of living adjustments they already agreed to in 2010 and 2011.
The bottom line is a 20 percent reduction in overall compensation from what employee groups had agreed to with the exception of the police department that opted for layoffs in order to keep back-to-back 5 percent pay increases in 2010 and 2011.
That means Manteca will have a balanced budget barring any more state thievery of local dollars. And it was done by employees – excluding sworn police officers – taking a 20 percent reduction from previously negotiated compensation with the bulk being saved through forgoing 5 percent pay increases in 2010 and 2011.
Only two of the eight cities Manteca compares itself with do it for cheaper – Turlock at $414 per capita and Modesto at $506 per capita.
But as City Manager Steve Pinkerton has noted, Manteca is fairing even better in the low-cost department since unlike most cities in the survey it is a “full service” city not only providing fire and police services which some jurisdictions contract but has kept garbage collection – the one service that’s typically contracted out – in house.
Manteca now is running with per capita expenses that are near the level in 2006 when there were 6,000 less residents and municipal services cost $484 per capita to run. They climbed to $559 per capita in 2007 that included the first six months of a four-year labor contract with the city’s bargaining groups that had built-in raises and then hit $559 in 2008 and dropped slightly to $555 in 2009. The 2009 figure reflected the decision to start leaving positions vacant when people retired or resigned in anticipating of dropping revenues.
Manteca revenue expected to drop to $403 per capita
Meanwhile, per capita revenue is expected to drop to $403 in 2010 to roughly 2000 levels when the city was closing in on 50,000 residents. Per capita revenue peaked at $532 in 2007 – the last time revenue exceeded expenses in a given year – and then dropped to $500 in 2008 and $463 per capita in 2009.Projections call for 69,200 residents in 2011 with per capita income of $394 versus per capita expenses of $536, Then in 2012 per capita revenue is expected to bounce up slightly to $397 while per capital expenses continue to climb to $542.
Personnel costs including salary are roughly 85 percent of the budget. Based on a reduced city staff that includes forgoing negotiated wages or – in the case of police 12 less positions – for the next two years along with spending down the reserves, Manteca was able to eliminate a $14 million deficit that they faced at the start of the current fiscal year that began July 1.
However other expenses such as electricity continue to climb. The expense projection anticipates hiring more people to meet the demands of growth but in reality the city will likely opt to do even more with less staff.
Revenue could also go higher if cost recovery proposals are put in place in the coming months. While some fire department cost recovery charges that could generate $60,000 plus in a year have already been adopted, the major ones that impact costs associated with planning for growth have to be verified by an exhaustive study known as a matrix to meet state legal requirements.
In an October presentation to the business community, Pinkerton noted that labor costs were the major factor in the city’s financial situation.
He pointed out:
• the majority of the budget gap was due to double digit annual increases in labor costs.
• those additional costs were due partially to increasing staffing to keep up with population.
• that increasing pension payments and health premiums contributed to the problem.
• labor contracts in comparison cities have put upward pressure on overall compensation.
Manteca may change comparison cities
Among the possible ways of further reducing the city’s susceptibility to labor cost fluctuation has been talk about changing the eight cities that Manteca compares itself with in salary negotiations by dropping Bay Area and Sacramento region communities and instead using cities in the Northern San Joaquin Valley. The out-of-region cities have per capita costs of running their cities that are $400 plus per capita higher than Manteca’s and in some cases such as Roseville are more than double.That isn’t expected to impact recruiting and keeping good employees over the next few years due to the state’s 12.2 percent unemployment rate.
The city took the stance that dropping revenues meant dropping employee compensation as well. They have also been guided by a need to maintain services which mean they couldn’t make all of the cuts through salary reductions.
After target numbers were set to make sure the budget deficit could be bridged, employee groups were given the option between layoffs within their groups or compensation reductions.
Furloughs resulted in a 3.8 percent across the board cut. All groups except for the police officers agreed to increase payments toward their own pensions and forgo cost of living adjustments they already agreed to in 2010 and 2011.
The bottom line is a 20 percent reduction in overall compensation from what employee groups had agreed to with the exception of the police department that opted for layoffs in order to keep back-to-back 5 percent pay increases in 2010 and 2011.
