Lathrop — by standards established by the state auditor — is the sixth most financially sound city in all of California.
Manteca was 136th in terms of fiscal soundness out of 471 cities while Tracy was 295th. Ripon was not evaluated as their financial numbers were not available.
In the report posted to the California State Auditor’s website this week, Lathrop came in at 465 out of 471 cities surveyed for overall risk – making it the sixth-healthiest city in the State of California when it comes to the 10 criteria set forth in the auditor’s assessment.
The fact that just 10 years ago Lathrop was facing budget deficits of more than $15 million, the turnaround wasn’t lost on Mayor Sonny Dhaliwal – who credited city staff with the remarkable turnaround.
“When I joined the council 2006, we were doing pretty well economically, but when we looked at the numbers in 2008, we were facing a $15 million deficit by 2013,” Dhaliwal said. “So the council made some difficult decisions – the furlough program, eliminating 10 open positions, and laying off 11 people, which is still the most difficult decision I have ever had to make as an elected official.
“By 2012 we had over $6 million in general fund reserves, which is a $21 million turnaround, and we have been making solid progress ever since.”
And Lathrop wasn’t the only local city that fared well.
Manteca, which came in at 335 out of 471, was also classified as “low risk.” Turlock, for example, while similarly sized, came in in the top 30 percent at 127 of 471 — meaning 126 cities were on less solid fiscal foundations than Turlock — to earn a “moderate” risk tag.
Out of a total score of 100, the California State Auditor assessed and assigned point totals to 10 categories including liquidity, debt burden, general fund reserves, revenue trends, pension obligations, pension funding, pension costs, future pension costs, other post-employment benefits (OPEB) obligations, and OPEB funding.
Lathrop scored a 95.27 out of 100 while Manteca scored an 80.47. Turlock, for comparison purposes, clocked in at 58.85.
While Lathrop has benefitted heavily from a booming residential growth sector and a number of large warehouse buildings in the last few years – including a Northern California distribution center for Ashley Furniture, which includes a point-of-sale outlet – the city has also relied on a number of sales tax revenue generating businesses like high-volume truck stops and diesel truck sales.
The one cent sales tax increase approved by voters in 2012 has since allowed the city to further grow its reserves while at the same time funding a number of public projects that wouldn’t otherwise be possible given the city’s fiscal restraints.
“We have Ashley Furniture and Wayfair is coming online and we have a lot of other irons in the fire,” Dhaliwal said. “Even after 2012 when things started to get better, we started looking at 5 and 10-year economic models so that we can look into the future and see how our income is looking and give consideration to the projections before we spend any money – we want to be careful about how we spend taxpayers hard-earned money.
“The council gets very good advice and it shows – these numbers show that the city is being run by a fiscally conservative council and is being advised by a fiscally conservative staff.”
To contact reporter Jason Campbell email email@example.com or call 209.249.3544.