City of Lodi employee medical costs have risen less than expected so far this year, providing some positive news for a budget that continues to be under pressure.
The medical costs were reviewed as part of the Lodi City Council's mid-year budget review on Tuesday. The fiscal year ends June 30.
Other bright spots were savings in the Lodi Electric Utility because of vacant positions and savings in the transit divisions because two projects costs came in lower than estimated.
At a meeting in January, the council reviewed its revenues department-by-department. The council is tentatively scheduled to make any mid-year adjustments to balance the budget at its 7 p.m. meeting on Feb. 15.
The city's General Fund balance, which pays for services like police, fire and the library, will be a little more than a quarter million in the black, Deputy City Manager Jordan Ayers said. Revenues were about $72,889 less than the budgeted estimates for the fiscal year, but expenses were also down by $325,180.
Almost all of the city's departments are showing savings in this fiscal year, with the exception of Economic Development.
Below are some tidbits from the meeting:
Medical costs: Many departments saw a savings in medical costs, Ayers said. The city had estimated a 12-percent increase in medical expenses, but the average increase ended up only being 6 or 7 percent, he said.
"Believe it or not, medical costs came in lower than expected," he said.
During the last decade, City Manager Rad Bartlam said medical costs have usually increased by 16 percent each year.
The other main savings come from bargaining groups' agreement to cap the city's medical costs or take the lowest cost plan available, Ayers said.
Economic Development: This is the only department that is over budget. It is $20,000 over estimates, in part, because of unbudgeted costs from the Fireworks Task Force. Those costs were paid for with fees assessed to the nonprofits that run the booths. When the Lodi City Council approved the fireworks ordinance, the council required the fee to pay for extra police and fire patrols looking for illegal fireworks.
"At the time that was put together, it was just after the budget was put to bed," Ayers said. The department is also about $9,000 in the red because of a catch-up payment to Visit Lodi!
Internal Services: The department is down by almost $104,000 compared to the budget. There are vacancies in the Information Systems department and there are some employees on short-term disabilities, so they are taken off the payroll and paid through insurance.
"From a budgetary perspective, it's a great thing, but it does mean we have someone out," Ayers said.
Internal Services also saved money by paying off a computer system and because employees took lower cost medical plans.
Police: There are savings of $73,747 from a vacant captain position that will remain open. City staff recommends that the extra money is put into the vehicle replacement fund to replace six vehicles.
Public Works: Employee concessions offset some unexpected building maintenance, so the department came in $32,532 under budget.
Library: The department's expenses and revenues came in $11,050 higher than expected because they had received money to buy books through outside grants.
"The library has lost city funds and done a great job getting grants and other donations and sponsorships," Ayers said.
Parks, Recreation and Cultural Services: This year was the first that the departments were merged into one fund, Ayers said.
The revenue is coming in on target, but the expenditures are higher than expected by $140,000, Ayers said, Those expenses are still covered by the revenue, Ayers said.
The increase in expenses came from city staff not budgeting for the costs of recreational instructors, which was $85,000, and part-time staff was over budget by $109,000. At the same time, the city had savings in employee medical costs and fuel and lubes for equipment.
Transit: The department had significant savings from two of its large projects, Ayers said. The bids from contractors came in lower than expected, so the city saved $350,000 on a solar project at the Municipal Services Center and $383,000 for a security systems project at the parking garage in Downtown, Ayers said. The city also saved $97,000 from revising equipment replacement plans.
Lodi Electric Utility: The city has saved $3.4 million because of reduced power purchases, which has also corresponded with less revenue.
The department is also saving $470,000 in salary and benefits from vacant positions, at least one of which they are trying to fill.