The preliminary operating budget for Fiscal Year 2017-18 presented by Assistant City Manager/Director of Finance Marisela Garcia was adopted by the Riverbank City Council a few days ahead of the July 1 start of the new fiscal year. During the presentation to the council on June 27, Garcia gave an overview of the General Fund, Special Revenue Funds, System Development Fee Funds, Housing Funds, Sewer Enterprise Funds, and Water Enterprise Funds.
“This has been a result of a lot of work,” stated City Manager Sean Scully. “As the council has discussed both in open and in closed session there is significant financial consideration this year specifically within the general fund so it has been a lot of work even to get to a preliminary operating budget.”
The State requires the City to have a budget prior to June 30 and due to negotiations of new labor contracts with the Riverbank Miscellaneous Bargaining Unit, the Riverbank Mid-Management Employees Association and Stanislaus County with their Deputy Sheriffs Union, the Operating Budget was presented as a preliminary budget basically meaning that it is on hold until the negotiations have concluded since the results will affect the budget.
Garcia explained that the beginning reserve estimated for the General Fund as of July 1 is approximately $1.1 million, which is at 12.8 percent. This is above the 10 percent required by the City Council. Projected revenues for the fiscal year are at $9 million and the expected expenditures are estimated to be about $9.4 million.
“So the reserve at the end of the fiscal year is estimated to be about $748,734 which is 8.3 percent, below our 10 percent required reserve,” said Garcia. “In order to get to our required reserve we would need an additional $155,666 whether that be in revenues or expenditures savings.
“Structural deficit is really the figure that you want to look at; it is $381,100 that is the difference between the revenues we are anticipating and our expenditures. So what that is telling us is that our expenditures are significantly outpacing the revenues that we have ongoing.”
One of the major revenues for the City, Garcia explained was the Sales Tax which is about 32 percent of the City’s revenue source and should be increasing by about 5 percent. This was an estimate that was given to her by the Sales Tax Auditor.
The other things she said would impact the city’s budget are stores closing like the Payless Shoe Store and more shoppers shopping online.
The major expenditures for the city includes the law enforcement contract is at $3,917,000 or roughly 42 percent; salary and personnel expenses at $3,170,500 which makes up 34 percent; and operating expenses at $1636500 accounting for about 17 percent.
The formal Operating Budget for Fiscal Year 2017-18 should be finalized by late August or early September, officials said.