Council approves lean budget

Is City Hall solvent, or risking fiscal collapse? That depends on where you stand regarding Chico’s budget deliberations—specifically, in relation to Larry Wahl.

For the better part of an hour Tuesday night (July 1), as City Manager Dave Burkland and Finance Director Jennifer Hennessy presented the City Council with updated figures, Wahl sat patiently. He contributed quick comments to tangential discussions (whether an art project ever got funded, and if the city clerk could put PowerPoint presentations online). Otherwise, he remained quiet during an encouraging staff report that drew celebratory interjections from a few of his colleagues.

Chico is solvent, Hennessy declared. Starting with fiscal year 2008-09, which coincidentally began Tuesday, the city will be in the black for the first six of the 10 years in its budget plan, albeit with less-than-optimal reserves. If negotiations with employee groups “go as planned,” further adjustments should balance the final quadrennium.

“We came very close to the target reductions,” Hennessy said. “It’s much more optimistic a picture than a few months ago.”

That’s when $55 million was the city’s mantra. Budget projections last year under Burkland’s predecessor, Greg Jones, suggested an average shortfall of nearly $6 million a year—double if the city continued along its staffing and compensation trajectory.

The Finance Committee spent 10 months considering ways to reduce the deficit, culminating in last month’s council vote to reduce spending 7.5 percent across the board in all departments and ask unions for concessions. Those and other measures impacted the general fund; for redevelopment funds, the city has reduced the red ink from $22 million to $5.7 million for ‘08-'09 and will hit the black in ‘10-'11.

Steve Bertagna, the longest-serving incumbent, couldn’t contain his enthusiasm. Like a giddy kid, he referred to an item later on the agenda about renegotiated agreements with two unions. And when Vice Mayor Ann Schwab moved to adopt the final budget, he seconded the motion. “We started out on the wrong foot,” he said of budgeting, “but we came around … and we’re heading in the right direction.”

That’s when Wahl finally spoke up. “I find the proposed budget flawed,” he began, in a strong, even tone. “I’d go so far as to say it’s built on a house of cards.”

Dissenting from the five progressives as well as Bertagna, Wahl detailed his concerns. The city still needs to reach agreements with six bargaining units in order to meet reductions upon which the budget balance depends. The projections for sales-tax growth are “shaky” in light of flat figures this past fiscal year.

As for the 7.5 percent cuts, which he and Schwab voted against because of the effect on the police and fire departments, Wahl decried how “public safety will suffer dramatically. It’s shameful that we’d balance this budget on the backs of public safety [employees] and jeopardize the safety of the community.”

The city should have considered other alternatives: changes to scheduling and overtime; two-tiered compensation, in which new employees get lesser benefits; a hiring freeze; looking at each of the 453 city jobs and deciding which to cut. He called the budget “a harbinger of a tax increase” in the next few years and concluded by saying, “I wish we could get the negotiations nailed down. There’s no assurance they will be by January.”

Mary Flynn, who serves with Wahl and Scott Gruendl on the Finance Committee, wasted little time in upbraiding her colleague—basically, the two seconds it took to say, “I respectfully disagree.”

“This is a two-year budget process,” she said, referring to the phased cuts in spending, “so the hard line you take tonight [in saying] that it’s doomed from the beginning is flawed logic in that, as we go forward, we’ll have the chance to revisit, and we’ll constantly reassess, assumptions.”

Flynn, who’s devoted much of her first term to the budget, didn’t single out Wahl when she asked: “Where was the financial stewardship that allowed us to get to this point? This didn’t just appear overnight.” She held the two-termer to the fire, though, in stating, “I’ve continually heard you criticize, but I’ve yet to hear you bring forward any tangible idea [with specifics as to] how it will actually save us money.”

The council adopted the proposed budget, 6-1, then unanimously decided to continue funding the local branch of the Butte County library so it will stay open an additional 25 hours a week.

Earlier, all seven councilmembers—acting jointly as redevelopment agency officers—approved Parkside Terrace, a complex with 90 units of affordable housing within the proposed Meriam Park development. They also delayed deciding on whether to charge nonprofit groups to meet in the City Council building, returning the matter to the Internal Affairs Committee.

Around 11:20, split along political lines, the council voted to hold a hearing on whether to petition Congress to impeach the president and vice president. Bertagna and Wahl cast the no votes, after Wahl capped the meeting by saying, “I support President Bush and Vice President Cheney in the war on Islamofascist terrorism.”