The City of Lodi has posted its draft 2020-21 budget on its webpage, and in the document’s introduction page, city manager Steve Schwabauer said staff has never prepared a budget in more uncertain times.
The COVID-19 pandemic and government response to it have placed unprecedented strains on the economy, he said, and several assumptions made in the upcoming budget remain unpredictable.
However, staff was able to balance the budget, made possible by cutting more than $2.1 million in expenses, he said.
“We’ll get by through leaving several vacant positions unfilled,” Schwabauer said. “We’ve reduced planned acquisitions of vehicles, equipment and capital materials, and we’ll also be reducing the amount of capital projects we had planned for the coming year.”
Prior to the COVID-19 pandemic and resulting state shutdown, the city had planned to replace seven patrol cars at the Lodi Police Department, Schwabauer said. Now, with an uncertainty as to how much funding will be available to make those purchases, the city might only purchase as many as three.
In addition, the department planned to replace the computer systems and radios in its patrol fleet. About two-thirds of the equipment had been replaced prior to the pandemic, and Schwabauer said the plan is to now only upgrade about a third of the one-third remaining.
Along with not purchasing all seven new patrol cars, the city will not be filling seven vacant positions in the department.
Schwabauer said positions will remain unfilled for some time, unless a new police academy is conducted and new graduates emerge from it.
Because of the hiring freeze and reductions in purchases and projects, the city is anticipating both revenues and expenditures to both somewhat mirror last year’s numbers, as well as remain stable for the next few years, excluding any major catastrophes, he said.
Revenues for 2020/21 are expected to be nearly $59.7 million, while expenditures look to be about $59.9 million. Despite the more than $293,000 shortfall gap, the city anticipates an ending general fund balance of nearly $21.5 million by June of 2021.
The city’s two largest sources of revenue are sales and property taxes, and with the former expected at $12.8 million, Schwabauer said that is an 11.8% reduction from what was anticipated during a mid-year review six months ago.
Property taxes are estimated at $11.7 million, an increase of about $650,000 from last year.
Also anticipated to drop from the mid-year budget expectations are business license taxes and hotel occupancy taxes, the former of which is expected be nearly $1.16 million, a decrease of 21.6% from last year.
The hotel occupancy tax is expected to drop by 47.5%, from $1 million in 2019-20 to $525,000 in 2020-21.
While a balanced budget will be presented to the council on Wednesday, many uncertainties lie ahead for the city, Schwabauer said.
More information detailing the impacts of the COVID-19 pandemic most likely won’t be available until later this summer, he said, and staff will present an update to the council in September.
“Obviously there will be some pain out of this, unfortunately,” he said. “However, we’re not proposing any drastic service cuts because the council has been disciplined to expect a moment like this. I’m pleased we didn’t have to make any cuts that affected our residents.”
To view the draft 2020/21 budget, visit www. lodi.gov/ArchiveCenter/