Manteca has spent the past five years doing what many families and business have done — paying off debt, shedding expenses, and rethinking how money is spent.

The result is a lean municipal operation that instead of teetering on the financial abyss such as Stockton tis on the edge of going a year without spending more money than it collects during the same time period.

The proposed $27,746,460 general fund budget to cover day to day operations such as public safety, parks, streets, and general government is the subject of a 3 p.m. City Council study session at the Manteca Civic Center, 1001 W. Center St.

The budget as presented by staff anticipates $27,877,975 in expenses. That reflects a structural deficit of $145,720 that is being covered by dipping into municipal reserves. But if county assessor projections are correct, Manteca might be a little too conservative in anticipated property tax revenues. If that’s the case there is a solid chance for revenues to exceed expenses slightly in the fiscal year starting July 1. If that happens, it’ll mark the first time in nearly a decade that the city hasn’t relied on bonus bucks paid for sewer allocation certainty or other non-earmarked reserves to cover revenue gaps in the general fund.

Another financial milestone will also be reached in the coming months. The final payment will be made on a 25-year loan from 1978 to cover the cost of converting the old wastewater treatment plant to expand the golf course to 18 holes and buildthe tennis courts along Union Road. The last payment will be made later this year to free the golf course of a $52,000 a year obligation. That debt accounts for 5 percent of the golf budget for the current fiscal year. Since the clubhouse was paid off when the last $175,000 annual payment was made almost three years ago, that means the golf, course will be external debt free. At one point debt service accounted for 22 percent of the golf course’s operating budget.

The proposed budget also calls for the golf course fund to repay a $28,000 inter-fund load made from the parks fee account in 2008 to pay for an irrigation project.

Five years ago, Manteca’s spending was on pace to have an outright deficit of $5.4 million in the coming fiscal year.

City leaders responded to that sobering news from city staff by forming a citizen’s blue ribbon panel to examine Manteca’s financial situation and to make recommendations. City leaders listened and acted.

They pared back the municipal workforce by almost 30 percent primarily through early retirements and not filing positions.

City workers agreed to take compensation reductions in excess of 20 percent.

Staff looked at long-range ways to save money by leveraging other money to make investments to reduce general fund expenses. The street light retrofit using federal stimulus funds, for example will cut the city’s PG&E bill for street lights by 40 percent.

At the same time, Manteca’s growth cap policy that gave birth to bonus bucks and development agreements set the stage for developers to continue building 300 homes on average a year since 2006 while building dropped to a virtual standstill l in neighboring communities.

All of that has resulted in a $5.4 million turn around in Manteca’s municipal fortunes.

Manteca has been able to balance budgets since 2006 by drawing on reserves, spending down bonus bucks developer spay for sewer allocation certainty, and slashing expenses.

Meanwhile, all other municipal funds are solid. In fact they are so solid that Standard & Poor  issued Manteca an improved rating going from “A+” to “AA-“on their outstanding water bond debt of $41.6 million. At the same time Manteca is spending more than $6 million on system upgrades while holding water rates unchanged for four consecutive years.

Fitch — another one of the big three credit rating agencies that also includes Moody’s — kicked up Manteca’s wastewater treatment bonds to “AA-“from “A+”. There is $45.8 million in outstanding wastewater bond debt. Municipal sewer customers have also gone four years without rate increases while the city has spent millions on upgrading sewer lines.