Council Approves 2018 City Budget
Priorities include public safety, capital improvements and general services.
TEMPLE CITY, CA (July 1, 2017)—On June 20, Temple City council members adopted the city budget for fiscal year 2018.
The 2018 budget is set at $18.5 million, a decrease of $1.65 million from 2017. Over three-quarters of the budget—or $15.95 million—is allocated to the general fund, with the remaining $2.55 million assigned to so-called “special” funds.
The general fund, supported by sales and property taxes, provides a majority of city services and programs. Special funds, which are mainly voter-approved gas and road taxes, are set aside for designated uses.
The 8.2 percent decrease is largely due to a ramping down of the General Plan Update, which soon will guide the city’s future development. The 2018 budget also reflects some decreases in revenue. Statewide, there has been a decline in gas tax revenues due to lower prices at the pump, as well as a decrease in federal Community Development Block Grants.
Despite the decreases, the cuts only impact the general fund’s reserve—the “rainy day” fund—which is grown by investing annual budget surpluses. The 2018 surplus, projected to be $106,000, will be invested into the reserve as in previous years.
“Had revenues stayed the same or grown, we would have been able to allocate more to the reserve,” says city manager Bryan Cook, adding that, “as things stand, residents can be comforted knowing that they will enjoy the same level of services as always.”
The general fund reserve currently has $16.1 million, enough to fund city operations for more than a full year. “Most cities do not have this level of financial protection,” says administrative services director Tracey Hause. “While our reserve is at about 114 percent of operating expenditures, most other cities only have five to 20 percent.” The reserve is primarily used for strategic long-term investments and emergency purposes.
Law enforcement will continue to be the city’s largest expense at roughly $4.33 million, or one-third of the general fund budget.
The budget also calls for a number of public works projects including a $2 million repaving of Temple City Boulevard this fall, and a $3.8 million renovation and expansion of the Temple City Library. Both the city and county will share equally in the cost of the library project, which is expected to begin in mid-2018.
Downtown improvements will also continue, with construction ending soon for a new $500,000 public parking lot at Woodruff Avenue and Temple City Boulevard, and a $125,000 demolition of city-owned properties on Primrose Avenue, just north of Las Tunas Drive. According to Cook, the properties “will be readied for future development.”
Cook also noted that city officials will soon present recommendations to improve the Las Tunas Drive streetscape between Cloverly and Kauffman Avenues. Although the project is in preliminary stages and the cost unknown, “the improvements will only be aesthetic, such as new benches and flower pots,” says Cook. “It will not result in any road re-configuration, bike paths or narrowed lanes.”
Hause noted some trends that could affect the city’s long-term budget situation. “By no means are we dealing with a crisis, but we will definitely be financially cautious as we move forward into the next year,” she says.
The city is seeing a slight cool down in construction activity, which will affect its future property tax and permit revenues. “We’re continuing to monitor China’s possible restrictions on outgoing investment, which could significantly impact Temple City’s economic growth,” she says.
Gas taxes, which provide sizable revenue for road repair, will also decline in the future as car manufacturers continue to meet federal mandates for hybrids and electric engines.
“Like the private sector and other cities, we’re also dealing with rising healthcare and pension costs for employees,” says Cook. “But because we’re a contract city—meaning we contract out for core services such as law enforcement and public works—we don’t incur large, ongoing personnel, pension and equipment costs,” Cook explains. “We can enter into new contracts with other service providers to keep costs competitive.”
One positive trend is that a growing restaurant scene has increased the city’s sales tax base over the past six months. “There’s no doubt that the new restaurants opened in and around Camellia Square are generating healthy sales tax revenue,” Cook says. “So much so, that if Kmart was to go out of business tomorrow, these new restaurants would cover the loss in sales tax revenues.”
To view the 2018 city budget, visit templecity.us/budget.
—To view other City news releases, visit templecity.us/pr.—