California
With City’s Finances Uncertain, Brand Calls for Budget Delay
The COVID-19 pandemic may have claimed a new victim — the city of Fresno’s budget process.
Mayor Lee Brand wants Fresno’s budget to remain status quo beyond the June 30 deadline to pass the spending plan for the next fiscal year.
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“The decision to propose a continuing resolution was not an easy one and was taken with a great deal of thought and consideration, with the overriding concern to minimize the impacts of this crisis on the critical services the city provides to our residents and our employees.” — Fresno Mayor Lee Brand
On Wednesday, Brand announced his plan to submit a continuing resolution to the council that would “roll over” the prior year’s $1.189 billion budget through at least September. If the continuing resolution is approved by the council, it would bypass the deadline.
“The decision to propose a continuing resolution was not an easy one and was taken with a great deal of thought and consideration, with the overriding concern to minimize the impacts of this crisis on the critical services the city provides to our residents and our employees,” Brand said in an email statement. “I believe this is the correct path to ensure the city of Fresno can fulfill its responsibilities, and I firmly believe that as a community we have demonstrated that we have the courage and dedication to weather this storm and emerge a better and safer city.”
The proposed change to the budget process would be the first in the 23-year history of Fresno’s strong-mayor format. According to the city charter, the mayor submits a budget to the city council by June 1. The council can then seek to amend it before a final vote.
According to city documents, Brand was supposed to roll out the budget on May 20. The city council set seven hearing dates in June for debate and voting.
Related Story: $32 Million Deficit: Fresno’s Doom and Gloom Budget Projection
Why the Delay
In a news release, the Brand administration said the delay would “provide a bridge that would allow the city of Fresno to continue to provide essential services to the community and pay its employees until the fiscal picture becomes clearer.”
Brand is pushing for this change “due to the uncertainty over the full financial impact of the COVID-19 pandemic on the City’s operational funds, making it virtually impossible to estimate revenues for the next fiscal year around which a budget can be built.”
“We will have to make budget adjustments no matter what the scenarios are. We would rather do that sooner than later.” — Fresno City Council President Miguel Arias
At an April city council meeting, assistant city manager Jane Sumpter said the FY 2021 budget could take a $32 million hit because of lost revenues from the pandemic.
That uncertainty, City Hall says, makes it “virtually impossible to estimate revenues for the next fiscal year around which a budget can be built.”
The Brand administration has taken steps to tighten the budget. Among them: hiring restrictions, seeking alternate funding sources for capital projects, and restricting operational expenses to those deemed necessary to maintain core or health- and safety-related services.
The mayor said that he anticipates proposing a budget in the fall.
In November 2018, Fresno voters passed the Balanced Budget Amendment, approving a change to the city charter mandating a balanced budget by June 30 of each year. However, there is no penalty for not passing a budget on time.
Council Reacts
“This is a very complicated budget season because of COVID-19. There are many questions and not a lot of answers. We want to continue to provide a level of services,” said councilman Paul Caprioglio, who serves on the council’s budget subcommittee.
Council president Miguel Arias says he has spoken to the mayor about his request.
“We have to balance our fiduciary duties under the charter and the Balanced Budget Act to pass a budget by June 30, with the staff’s request for more time. We will have to make budget adjustments no matter what the scenarios are. We would rather do that sooner than later,” Arias said.
Councilman Mike Karbassi says he’s considering Brand’s idea.
“COVID-19 has created a lot of uncertainty and we need time to be able to assess the true impact to our economy,” Karbassi said. “A continuing resolution may be a useful tool so long as it includes hiring freezes for non-critical positions and a freeze on salary increases, etc.. But I am also interested in the input of my colleagues and other preventative steps we can take early on so we can have a balanced and responsible budget. My biggest priority is avoiding negative impacts to public safety and other services which are essential for our residents.”
