2010 City of Berkeley Annual Report
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How are we doing?
This is a question I hear frequently. The economy has been front-page news for almost two years now, and people want to know how City services have been affected. Like many organizations whose mission is to provide services, most of our budget is personnel costs: garbage and recycling collection, fire response, police protection, road repair, swim classes, meal delivery, and health education and treatment.
When cities are forced to cut costs by reducing staff, it means reducing or eliminating some services. In the last two years, the number of non-uniformed personnel has decreased by about 10%. We have worked to spread these reductions across departments and prevent major cuts to frontline services, but there is still an effect on services.
Unfortunately, the need to reduce personnel costs and services is likely to continue. The economy is still volatile and tax revenues are not improving, making this the worst economic climate in 30 years. Because of this outlook, the only thing we can be sure of is that City government will continue to shrink to adapt to the changing times.
In 2008, when the recession started, many cities were forced to immediately cut staff and services. Berkeley’s budget was more stable, but we still instituted a hiring freeze and generally did not replace workers who resigned or retired. For the next two years, we were able to maintain services because of long-term planning, staff attrition, a reliable property tax base and voter support for City services. Other City revenues, however, have been less dependable, including state grants, property transfer tax, the utility users’ tax and sales tax.
By the beginning of 2010, the City had a projected $16 million deficit for Fiscal Year 2011. We expected to cut about 50 vacant positions and lay off about 30 people.
Using a variety of measures, the City Council adopted a balanced budget without having to impose those layoffs. The vacant positions were eliminated, and hundreds of City employees volunteered to cut their wages by working fewer hours: a give-back to the City of about $2 million.
While this agreement helped us close the budget gap, implementing the reduction in hours requires that the City be closed two days every month and the last week of December. This will have an impact on services, and we will be monitoring that throughout the year.
Planning for the Future
Cost control and service cuts will be a big part of the budget discussions going forward, but they are not the only solutions.
The City is working hard to develop creative ways to allow services to continue with fewer resources, including:
■ 311 Customer Service Call Center and the Online Service Center (www.cityofberkeley.info/onlineservicecenter/);
■ Refuse route optimization: A review of our garbage routes may mean new pick-up days, but more efficiency;
■ Police patrol redeployment: A reorganization of our patrol assignments, putting officers where they are most needed; and
■ Realigning our mental and public health programs to respond to changes in funding.
Despite the challenges ahead, we will continue to strive to provide the best services possible. I encourage you to keep reading for information about some of the City’s accomplishments this year. Please let me hear from you about how we are doing.
NOTE: The budget process for the FY 2012 & FY 2013 biennial budget will begin this October with discussions about the City’s funding priorities. Although this is an early start, it will enable us to respond more quickly to the changing economic picture. There is more on the City's budget on page 3, and at www.CityofBerkeley.info/budget.
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