City boosts reserves, grows budget

Increased revenue and FEMA reimbursement lets officials save and spend more.

April 14, 2011|By Joe Piasecki,

A quick look at some of the key figures driving revisions to the city budget on Thursday might leave a person wondering whether the economic recession is behind us, at least in La Cañada Flintridge.

On the strength of unexpected growth in sales tax and business license fee revenues collected from July through the end of last year — indicators of increasing local economic activity — City Council members voted to extend La Cañada’s 2010-2011 budget , roughly $12 million, by another $147,400.

But by the time the budget bump made the books, it was basically money already spent.

Council members used $67,000 of the surplus to cover unexpected costs that include computer system upgrades and street improvements approved earlier this year.


The remaining $80,400 was also immediately allocated to new projects such as increased traffic engineering services, plumbing repairs at Mayor’s Discovery Park and plans to make City Hall more user-friendly for residents.

Perhaps even more remarkable in these tough economic times, city Finance Director Daniel Jordan now expects that the city’s already mighty fiscal reserves will grow this year by another $414,000 to a total of more than $14.1 million by July — a rainy day fund larger than what the city spends in an entire year.

That isn’t news you’re likely to read about in other cities.

“Honestly, I don’t know of one [city currently increasing reserves]. The bigger picture is salary freezes, furloughs, layoffs, and drawing down reserves,” said Jordan. “The mid-year budget is a positive story for the city’s financial position.”

According to documents, the increase in reserves is possible due to a $1.2 million reimbursement to the city by FEMA for costs born during the February 2010 mudslides.

Without that federal reimbursement, reserves might have declined by $800,000 — a point not lost on resident James Stoker, who said he believes City Council members are spending too much.

Stoker was critical of largely grant-funded projects, such as the recent installation of bike lanes and upgrades to the back slope of Memorial Park, that he described as unnecessary expenditures. He also expressed some worry that council members are budgeting for receipt of grant money before they receive it — essentially counting chickens before they’ve hatched.

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