LONDON: Port Hueneme is expected to have a small surplus for fiscal year 2016-17, but the city still faces numerous challenges to avoid long-term insolvency, according to Interim City Manager John Baker. The City Council took its first swipe at the budget at a special meeting Wednesday, where council members were asked to provide input for Baker to incorporate into a final document.
According to the preliminary budget presented Wednesday, the general fund will end fiscal year 2016-17 with a $272,694 surplus that’s buttressed by a one-time $700,000 insurance reimbursement for work on the Hueneme Pier in 2014, creating a final surplus of $972,694. This will bring the general fund’s reserves to $5.48 million. In 2010-11, the reserve fund was $21.3 million.
The general fund revenues were $16.3 million in 2015-16. They will be $16.1 million in 2016-17, according to the preliminary budget. Expenses were $17.9 million in 2015-16, leaving a deficit of $1.7 million, which was covered by the reserve fund. But to create a balanced operating budget will require staff shuffling, elimination of positions and contracting of departments, Baker said, adding that in the long term, the city needs to find ways to increase revenues.
The entire Port Hueneme budget is $50.8 million for 2016-17, with the general fund at $15.8 million. Other separate budgets include the city’s Housing Authority, the Surplus Property Authority and various special revenue and enterprise funds. Baker said that after this year’s budget is finished, he and the rest of the finance department, which is headed up by Interim Finance Director Al Burrell, will start working on a two-year budget, which will allow for better long-range planning. Among the long-term issues to be hashed out will be a review of special assessment districts and enterprise funds to make sure each department — water, wastewater and solid waste — is collecting enough to cover expenses and set aside money for system repairs.
Councilman Tom Figg said he has been asking about an investigation of water rates, which are among the highest in Ventura County. Figg also questioned what he said was an increase in city attorney fees. But Baker noted that the preliminary budget proposes a complete study of those rates. The contracted city attorney fees have actually been reduced, Baker said, adding that contracted fees that are also listed in the budget are for the city manager search. Figg again proposed a parcel tax that would benefit public safety — police, crossing guards and lifeguards. Baker noted that it is too late for such a measure to be added to the November ballot.
Mayor Doug Breeze said the council will look at various proposed tax measures, agreeing with Figg that a new business tax measure needs to be formulated. Baker did note that the city has received an additional $40,000 in business taxes by approaching various contractors that do business at Naval Base Ventura County, Port Hueneme. Among the various personnel changes proposed in the budget are the elimination of the community development director’s position, with Deputy City Manager Carmen Nichols heading up the Planning and Zoning Department, which will incorporate many of those duties, as well as the Recreation Department.
According to actions taken in March, the landscaping and maintenance functions will be eliminated and those services will be contracted. The council also eliminated its own health insurance, as well as some other payments. The Hueneme Beach Festival was canceled in March, and several community recreation programs were eliminated, although the Port of Hueneme has said it will pick up the tab for summer movies in the park, according to CEO Kristin Decas, But Breeze bridled at eliminating the Chamber of Commerce stipend of more than $5,000. And Councilman Jon Sharkey opposed pulling out of Beach Erosion Authority for Clean Oceans and Nourishment. BEACON is the regional joint-powers agency designed to preserve beaches and waterways.
Both issues will be addressed at the next council meeting June 6. Among the issues on the horizon are the resolution of the U.S. Department of Housing and Urban Development’s demand that the city reimburse about $2.4 million in improperly claimed costs. Baker said the city has responded to the HUD demand and explained its accounting practices, and is waiting for a response from the agency. He did note that if the city should still be required to repay the money, it would do so over a period of time.