New budget squeaks into balance

SAN MARCOS — Despite the current economic crisis, San Marcos staffers managed to deliver a tightly balanced, $61.8 million 2009-2010 budget to City Council on June 9, which was approved 4-1.
Balanced budgets have been hard targets to hit lately. In February, the council approved a series of cost-cutting measures that suspended city purchases and renegotiated city employee salaries. This was expected to leave $518,035 in surplus for the next year. Instead, sagging revenues reduced that to $14,000.
The new year’s budget will be a tight squeeze, with a final balance of just $9,100. This is based on what Finance Director Liliane Serio said was a conservative estimate of the city’s financial future.
“We’ve assumed that the current year was the worst in terms of revenue lost and that these revenue sources will stay flat in fiscal year 2009-2010 with minor increases in the next two years,” Serio said.
San Marcos is somewhat shielded against the glum economic times by its sizable $53.3 million in reserves, largely a result of the banking of one-time revenues during the housing boom. Serio said the city could withstand a downturn at least through 2011-2012 so long as things don’t get much worse.
Under the new budget, park custodial, median maintenance and street sweeping services will all be contracted out to save money. On the other hand, the budget includes, for the first time, two storm water management employees. They were funded by an out of court financial settlement with the county.
The city is also paying approximately $200,000 to preserve one of the three School Resource Officers, or SROs, sheriff’s deputies assigned to the San Marcos Unified School District. This year, the district cut the SRO positions for lack of funds.
“We feel that it behooves us to have the SRO there because if the principal picked up the phone, if they didn’t have a safety officer, we’d be dispatching more sheriffs to them in any case,” Vice Mayor Hal Martin said.
Some heated debate was had over the fate of the Discovery Valley Utility, or DVU, a city-owned nonprofit energy generation company. The utility has not served any customers since being established in 2000, but $14,000 was initially allocated to it in the proposed new budget with similar amounts budgeted over following two years.
When Councilman Chris Orlando recommended reassigning the money elsewhere, Councilman Mike Preston protested, saying the council was conceding to pressure from SDG&E not to compete.
“They want to get rid of the DVU because it’s a utility,” Preston said. “It’s not about $13,000, trust me. It’s about SDG&E not wanting anybody out there with the name ‘utility’ attached to it.”
Martin said that although he supported the DVU, he agreed with Orlando’s sentiments.
“Why are we putting $14,000 as a set aside into it when we know we’re not going to spend anything?” Martin asked. He then moved to amend the budget to remove the DVU line item. The amendment passed as did the amended budget. Preston was the lone dissenter vote on both.

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