By Phillip Pesola–
The days of budget cuts appear to be over in Citrus Heights, as the City Council earlier this month received a report showing a projected $8 million surplus this year.
During the March 9 meeting, the council was presented with a report showing a projected surplus of $8 million, with revenues projected to come in at $43.5 million — well-over projected General Fund expenditures of $35.5 million.
The presentation prompted positive comment from Vice Mayor Bret Daniels, who chaired the meeting in the absence of Mayor Tim Schaefer.
“You know, people need to understand where we are today, and where we believed we were just a couple of years ago when we were trying to pass the sales tax increase,” said Daniels, referencing the Measure M sales tax hike proposed in 2020, which he opposed. “It’s a remarkable contrast… for me, it’s an extremely pleasant item and forecast of where we are and where we’re headed.”
Daniels credited City Manager Ash Feeney and his staff with the city’s positive financial position. Feeney took the helm in January 2022, replacing Chris Boyd as the city’s top executive.
The surplus of $8 million is about $1.4 million above the prior surplus projected. The increase is primarily attributed to more revenue coming in from sales and property taxes, along with more than $700,000 in increased revenue coming from motor vehicle “in-lieu” fees.
While the budget has seen an increase in revenues, a budget adjustment to reflect an increase of $200,000 to expenditures was also requested. This change was due to a higher than expected CalPERS Unfunded Actuary Liability payment, which can be difficult to predict when the budget is initially created.
The report also covered American Rescue Plan Act (ARPA) funding, noting $5.7 million in remaining unallocated funds, from the city’s total $15.7 million allocation from pandemic relief funding.
For the city’s 10-year budget forecast, it was noted that the city’s cash reserve balance is projected to be $19.7 million by the end of June. This is well-above the minimum reserve required by city policy, as well as the City Manager’s reserve target, which are 17% and 25% of total operating expenditures, respectively.
City staff are in the process of preparing a new budget for the next two-year cycle, with the current cycle ending June 30. A preliminary budget is expected to be reviewed by the City Council in late April, with a budget workshop in May, and final adoption of a new budget by June.
The requested budget adjustments were passed unanimously by the three council members present. Mayor Schaefer and Councilwoman Porsche Middleton were absent from the meeting.
Detailed information concerning the city’s finances, including the current budget and financial reports for past fiscal years, can be found on the city’s website.
