So, if we don’t pass this sales tax measure, we’d better brace for impact? Is that what you’re telling us? asked one city resident at the Susanville City Council’s special meeting on Measure N held at 3 p.m. Wednesday, Jan. 29.
Debi Savage, the city of Susanville’s finance manager didn’t respond with exactly those words during a 30-minute or so presentation, but she pointed out the huge budget deficits the city faces and the possible cuts that will follow if city residents do not approve the upcoming sales tax measure.
Measure N, up for adoption by the voters in the March 3 Primary Election, imposes a 1 percent sales tax increase with all the funds raised going directly to local public safety. Measure N is expected to generate about $1.8 million per year for public safety — mostly for the police and fire departments — and eliminate these huge budget deficits.
“The future of our public safety is looking bleak unless were able to find an alternative funding method to continue operations,” said Mike Wilson, city administrator. “Measure N is a special tax measure that requires a 2/3 majority vote to pass, and this measure is specific to the preservation of public safety in our community.”
“What we’re trying to do is really important for us to preserve our public safety,” Savage said. “Our brothers and sisters in blue (and) our fire brothers and sisters in blue. Without the passage of the additional 1 percent sales tax, the city will be facing some major cuts in services.”
Savage explained the city receives funding from sources such as taxes, grants and fees for services. Those funds go to either to the general fund or to restricted funds. Restricted funds can only be used for the purpose for which they were collected.
The budget deficits — due in large part to changes in the way the city must pay its share of its CalPERS retirement contributions — are both staggering and long term.
“CalPERS is hitting us and other cities and counties in the state pretty hard,” Savage said.
According to Savage’s budget projections, in 2019-2020, the city’s budget revenues were $17.7 million and its budget expenses were $18.3 million, for a deficit of $526,524.
The deficit budget projection for 2020-2021 is $721,994; 2021-2022, $883,241; 2022-2023, $1,026,639; 2023-2024, $1,138,869; 2023-2025, $1,256,710; and 2025-2026, $1,351, 673.
Along the way, the city’s general fund cash balance, $2.4 million as of June 30, 2019, would have been completely expended by the 2022-2023 year, and the deficit would have grown to $3.8 million by fiscal year 2025-2026.
Believe it or not more than 70 percent of the city’s 2019-2020 general fund budget already goes to public safety.
According to Savage’s presentation, Administrative Services receives 27.3 percent of the general fund budget ($154,744), the Susanville Police Department receives 50.6 percent ($287,869) and the Susanville Fire Department receives 22.2 percent ($126,298).
If the sales tax measure is approved, Savage estimates the city fire department would have a $172,424 deficit for the fiscal year 2020-2021 but the sales tax proceeds would offset the deficits beyond fiscal year 2021-2022.
If the sales tax measure is approved, Savage estimates the police department would have a $395,340 deficit in fiscal year 2020-2021, but the sales tax proceeds would offset the deficits beyond fiscal year 2021-2022.
Savage also said other cost-saving measures could be negotiated with the employees’ bargaining units to require larger contributions to health insurance and retirement benefits.
According to Savage’s projections, the annual increase to the city’s general fund to pay for the police department will increase every year through fiscal year 2046-2047 with a high of $142,892.23 in fiscal year 2037-2038.
Savage reported similar numbers for the fire department with a high increase in fiscal year 2036-2037 of $64,916.96.
Kevin Jones, Susanville’s chief of police, said when people ask him what happens if Measure N doesn’t pass, he said the department is already understaffed, so he responds, “I don’t know … I support it because this is something people in this community are going to see for years.”
Hard copies of Savage’s Jan. 29 presentation at the city council meeting are available at the Lassen County Chamber of Commerce or online at cityofsusanville.net/wp-content/uploads/2019/11/PublicSafetyPresentation.pdf.