Sunday, 14 April 2024

Neiman's midyear budget review to council contains dire warnings

CLEARLAKE – Clearlake's city administrator is painting a bleak picture in the city's midyear budget review, and suggesting that the city may need to look at options like bankruptcy or divesting itself of parts of its jurisdiction in light of what could be ahead.


City Administrator Dale Neiman will make the presentation to the council at its meeting at 6 p.m. this Thursday, Feb. 11, in the council chambers at Clearlake City Hall, 14050 Olympic Drive.


In his report to the council, Neiman recommends the council provide comments and direction “on the serious financial issues” the city is facing and direct staff to evaluate the process for filing bankruptcy or detaching areas of the city to return to the county's jurisdiction.


He reported that the city has reduced staff by 30 percent and cut services. “Unfortunately, there is no way to provide appropriate services and make further cuts,” he wrote. “Without additional revenues, there is no way to solve the budget crisis.”


General fund revenues are 10-percent below budget projections, a trend that could result in the general fund being down by $356,755. That will leave the general fund with either a very small balance or a negative balance at year's end, according to Neiman.


The city's Proposition P police fund had a negative balance at the start of the year, and is projected to be in the red by $204,161 by July 1, for a total negative city cash balance of $428,630 at the end of the year, he said.


Redevelopment bond funds have been used to cover negative cash balances, but Neiman said redevelopment is supposed to have $373,000 less than the budget estimated.


He said the city receives less revenue than cities of similar size, with services costs that are much higher that similarly sized cities.


Neiman's report suggested that, if the funding trends continue, major issues will be facing the city, among them reduced policing and higher crime rates, degradation of paved streets and failing infrastructure, and citizen demand for services the city can't afford.


Beyond the initial mention of seeking bankruptcy or divestiture, Neiman's report does not go further into those proposals.


The other business item on the agenda for Thursday is consideration of confirming assessments for administrative penalties for failure to abate a public nuisance.


Also on the agenda for Thursday is the Anderson Marsh Interpretive Association's information report on the 2009 Old Time Bluegrass Festival, and the National Association for the Advancement of Colored People's presentation of an autographed photo of President Barack Obama to the city.


E-mail Elizabeth Larson at This email address is being protected from spambots. You need JavaScript enabled to view it. . Follow Lake County News on Twitter at http://twitter.com/LakeCoNews and on Facebook at http://www.facebook.com/pages/Lake-County-News/143156775604?ref=mf .

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