The city manager’s budget proposal for fiscal year 2011-2012,
which was published today, recommends the elimination of 18 Morgan
Hill staff positions and the addition of seven new ones due to an
extensive reorganization of some of city hall’s busiest
departments.
The city manager’s budget proposal for fiscal year 2011-2012, which was published today, recommends the elimination of 18 Morgan Hill staff positions and the addition of seven new ones due to an extensive reorganization of some of city hall’s busiest departments.
The budget, which will be the subject of a series of upcoming public meetings and council discussion, also warns that the city’s water and wastewater funds have become so cash-depleted that their recovery will require layoffs as well as rate increases, according to the budget message written by city manager Ed Tewes.
Those rates will have to go up by 10 percent each as of January 2012, though even that hike won’t solve the funds’ ills. “Either the council will need to consider a series of subsequent rate increases or a higher initial increase,” the budget message reads.
Three factors contributed to the water and wastewater funds’ ailments – the recent economic recession, weather-related cutbacks, and voluntary conservation, the budget says.
The six employees recommended to be laid off in the utility departments are a management analyst, four utility workers and a water quality specialist.
A recommended reorganization and consolidation of the gamut of development- and planning-related services will require the elimination of 11 jobs, but the creation of seven new ones, according to the recommended budget.
City departments long known as business assistance and housing services, public works and community development will be “streamlined and combined” into a new “community and economic development” department. The new department will be managed by assistant city manager for community development Leslie Little.
The proposal calls for the elimination of an administrative secretary, assistant to the city manager for downtown revitalization, redevelopment manager, business assistance and housing services director, housing program coordinator, housing rehabilitation coordinator, management analyst, municipal services assistant, office assistant II, planning manager and senior project manager.
Unrelated to these departmental changes, the budget also recommends eliminating an assistant to the city manager’s position which is currently vacant, and the police department’s animal control officer.
In all, more than 11 city employees could be negatively impacted by the proposed layoffs due to the city’s complex “bumping” policy that allows more senior employees to take existing lower-paid jobs.
The overall general fund is proposed to spend about $26.5 million for the fiscal year which starts July 1, which is higher than the $26.1 million projected to end the current year.
The proposal also assumes that the city’s redevelopment agency will remain fully intact, though it warns that the state budget could change that and potentially open up another $3 million hole in the general fund. Five of the positions already recommended for elimination are funded by RDA dollars.
Although city staff project sales tax revenues for the year – and each of the next five years – will be about 4 percent higher than projected this year, the city’s general fund will still suffer from a lag in revenues compared to their peak in 2007. This year’s projections see about $5.4 million in sales tax revenues in 2011-2012, while 2007-2008 brought the city about $7 million.
As a result, the budget will require spending of $1 million from the general fund reserve in 2011-2012. Tewes’ budget message says private economic development activity in Morgan Hill will have to rise in order to reach a balanced budget by 2013-2014.
“The effects of the recession will linger for years, yet the current costs, especially labor costs continue to increase,” Tewes’ budget message reads. “We must shrink city government to a level that can be sustained. This budget does that, if the clearly identifies assumptions in the forecast come close to fruition.”
