The Ripon City Council approved the amended annual budget for 2020-2021 fiscal year that reflects a softer hit from pandemic lockdowns than expected.
With it was a projected $410,000 deficit caused by the losses in sales tax and recreation revenue during the COVID-19 pandemic.
Staff recommended using the prior year surplus to fund the projected deficit coupled with the use of CARES Act funds to replace the small business grant.
"In July, we projected a $610,000 deficit," said City Administrator Kevin Werner during an earlier glance of the amended budget halfway through the fiscal year.
That was based on information shared with him in a recent City Manager’s webinar. Itt was revealed that the U.S. Real GDP showed the economy is currently above the lowest point of the Great Recession.
"The labor market recovery was slower in California with a slow recovery projected through the 4th quarter of 2020 and the 1st quarter of 2021," said Werner, who's predicting possibly late 2022 for recovery in the job market based on coronavirus vaccination timing and public health policies.
For the current fiscal year, Ripon has been stable given the City is about 20 percent behind this year in sales tax revenue compared to that of the previous year.
"The next true-up sales tax payment will arrive in February and give a better picture of what the fiscal year will look like," Werner said.
He recommended that Council transfer the Mitigation Fund Interest for the current year to the General Fund – the General Fund's surplus last year of $1.4 million is available to mitigate the projected deficit.
In addition, the City received $196,690 in CARES Act funding. Werner recommended transferring the CARES Act money to the Litigation/Natural Disaster Contingency fund that recently funded the Small Business Grants. Many local businesses received much needed financial relief from the Paycheck Protection Program relief funds.
The original budget did not include Capital Purchases, which could be used on staff's recommendation on a patrol vehicle, public works truck and a computer server.
Another expense, from the General Fund, is hiring a temporary part-time dispatcher. Werner said that person will eventually replace the outgoing dispatcher on a permanent full-time position.