State crippling the city
December 9, 2003
Marketing dollars may go out the window and vacancies may not be filled if the city’s dire budget situation continues at its current pace.
And that could be the least of it if South Lake Tahoe does not receive $910,000 from the state that it is counting on. This was the news coming out of the City Council meeting Tuesday. It adopted the 2003-04 budget, with the idea of revisiting the document if need be.
And even if the Vehicle License Fee money – referred to as backfill – does materialize, the city could face a $2 million shortfall for the 2004-05 budget because of rising health care and retirement costs.
“The city faces daunting challenges this next fiscal year even if we get through this backfill situation,” City Manager Dave Jinkens told the council. “These are not common times.”
For now, Jinkens suggested and the council adopted emergency measures to get the city through the next 30 days. The Legislature is not expected to vote on backfill bills until January. In the meantime, the city stands to lose $68,310 this month from the state.
El Dorado County is in the same boat with $5.1 million in VLF revenue losses. Supervisor Dave Solaro said the county will be exploring where cuts would have to be implemented in an all-day budget workshop next month.
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“It’s definitely going to make a dent in county services,” Solaro said Monday.
From the city’s standpoint, extra measures passed in the budget plan Tuesday include: placing subsidies usually earmarked to marketing agencies such as the Lake Tahoe Visitors Authority and South Lake Tahoe Chamber of Commerce on a month-to-month basis instead of their annual contracts. The local agencies would net about $62,000 and $11,000 a month, respectively, based on average room-tax averages. Last year LTVA received $846,191 and the chamber received $144,210.
LTVA Executive Director Bill Chernock asked if the council could give a further commitment because marketing decisions are often made well in advance. The council couldn’t make any promises.
Others came to the defense of marketing – including the South Lake Tahoe Lodging Association.
“Our members are extremely dependent on LTVA (efforts). We feel we’ve been there for the city. We’ve taxed ourselves. We’d appreciate you look long and hard before taking marketing dollars from us,” association President Jerry Birdwell said.
Councilman Hal Cole said subsidies to these agencies will be tied to the VLF revenue, and if it doesn’t come through, “all bets are off.” This is among other painful, proposed department cuts that have already saved $600,000.
City departments may have to dig deeper to find a way out of the financial crisis.
In addition, the city plans to save about $40,000 by suspending recruitment for eight positions. They include: police records supervisor, redevelopment management analyst, equipment mechanic, airport supervisor, assistant to the city manager, information systems technician and administrative clerk.
City management is also encouraging non-emergency workers to take a one- or two-day uncompensated furlough over the holidays as a means of saving money.
The 2003-04 budget also omits the street overlay program, funding for public service organizations and an expected hike in Lake Tahoe Airport tower operations imposed by the Federal Aviation Administration.
At the same time, the council saw a possibility for more revenue by approving a contract with an Alaska-based helicopter company to operate tours out of the airport. This is despite a few objections to the noise – one in particular from the League to Save Lake Tahoe’s Dan Sussman.
Airport Manager Mike Dikun said Era Helicopter pledged to fly between 1,200 and 1,500 feet under FAA standards. Projected revenues could range from $48,000 to $83,000.
The city also took steps Tuesday to boost revenue by adopting a 50 cent increase in the transient occupancy tax – which along with the 10 or 12 percent, plus $1 standard and redevelopment properties charge, will begin Feb. 1.
The council also raised fees for a variety of city services. They range from a $71 hike in the building code appeal charge, which now will cost $638, to a fire inspection fee now $208 – up $23.
– Susan Wood can be reached at (530) 542-8009 or via e-mail at email@example.com