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City Council adopts ‘status quo’ budget using $39k in reserves
Ceres city seal new

The Ceres City Council adopted the city’s 2023-24 fiscal year budget in a special Monday afternoon session – a budget which depends less on city reserves than in past years.

Last year the council used $1.2 million of federal ARPA COVID relief funds and $51,000 in reserves to balance the budget, but the new budget is balanced by using only $39,415 in reserves. That leaves the city with a 25 percent reserve, which exceed the city’s established minimum standard of 18 percent.

The city’s overall budget contains $86.8 million in expenditures.

“We did not add any new positions and staff was asked to compile a status quo budget,” Dias told the council.

The city has budgeted 179 employee positions, which is down from 210 in 2021-22.

The General Fund, which is the only fund which the council has spending discretion, starts with a beginning balance of $6.86 million and project revenues of $27.21 million. Projected expenses are expected to be slightly higher at $27.27 million to end the fiscal year on June 30, 2024 at $6.81 million.

The rest of the budget is comprised of enterprises funds for such things as water and sewer operations.

City Finance Director Leticia Dias said that revenues for the current fiscal year came in slightly higher than originally projected while expenses were right on target. She said the city expects revenues to increase, mostly because of the increase in sales taxes. Expenses are also expected to rise due to the increased cost of goods, negotiated salary increases and higher costs for retirement, employee health insurance, workers compensation and liability insurance costs.

Revenues from the developer agreements with three cannabis businesses remain the same as last year, $1.38 million.

Property taxes are holding steady, about the same as last year, explained Dias.

The budget overview reflected the spending of Measure H revenues from the half-cent sales tax measure. It showed funds being spent on 10 police officer salaries, contract costs with Modesto Fire Department equivalent to seven firefighters or engineers, fire apparatus equipment, loan repayments, tools, ticket writing software, replacement fire hoses and portable radios.

The council heard from each department head who explained their budget requests and different aspects of their budgets.

Ceres resident John Warren was the only one in attendance and spoke to the near doubling of animal control costs and asked why.

Councilman James Casey was against the budget plan and cast the lone “no” vote.

He noted staff’s “casual mention” of the $2 million in accumulated debt on the operation of the Ceres Community Center. Dias said the center debt could be reflected in the general fund budget but past policy makers “wanted the accounting kept separately so we can keep track accurately.”

Casey also sounded a critical tone about how much the city is spending on travel and conferences.

“My calculations show we’ve budgeted over $400,000 in travel and training,” said Casey. “I’m not suggesting that we don’t need to continue to be current in things but I also think that we should not have a blanket spending the money. We don’t have it. It’s not necessary. In the past we’ve had employee issues where we’re shorthanded yet we still sacrifice that department so that we can do the travel and training.”

He also took aim at the council’s own expenses, including the nearly $100,000 in health insurance, noting that the neighboring cities of Oakdale and Turlock don’t provide such benefits to their elected officials. He also cited the cost of council travel.

“It think that we should look at our (council expenses) budget – nearly $200,000,” said Casey. He noted the money could be spent on needed things like parks.

Nobody on the council offered their opinion on Casey’s remarks.

Vice Mayor Bret Silveira congratulated the city staff for coming up with a spending plan that didn’t depend on ARPA funds.

“You got us to a point where a lot of cities would love to be,” said Silveira. “There’s cities that are a lot smaller than us that would love to have a $40,000 deficit and be able to bail it out with a half of one percent of your general fund.”