City Manager Gary Pokorny confirmed in an e-mail that these private meetings have been taking place, and provided some background on what city staff have been doing to deal with a serious drop in revenues from the recession-driven decline in retails sales and auto sales taxes.
UPDATE: According to a city report released Friday afternoon, the city needs to cut $20 million to balance its $116 million 2010-12 budget. Sales tax revenue, hit the hardest, is expected to drop 11 percent during the current fiscal year and then another 3 percent during the 2010-11 fiscal year. Parking meter and garage revenue also dropped 9 percent this fiscal year, and property tax revenue declined 6 percent.
"What we have done is give a 'heads up' to a number of folks who might be facing a layoff," he said. The city will release its proposed budget late next week and the City Council will discuss it at its May 4 meeting. These layoffs will take place, Pokorny said, if the recommended budget is approved. "We have shared this information with [employees] in advance of an actual layoff notice to give them the longest advance warning of where we are proposing to make cuts in our programs and expenditures."
Any layoff notices would not be issued until after the council adopts a budget. Until that happens, the city won't know how many people will face layoffs and in which departments.
"We will know where we will actually be making changes and then we would give written layoff notices if we need to," he said. "I say "need to" because there is yet another caveat."
The city will try to save jobs by giving employees the option of retiring by July 30, Pokorny said. The incentive is that eligible employees (50 years and older and with five or more years of service) would be eligible to receive a medical spending account to help them pay for medical insurance and medical expenses for up to three years.
With Walnut Creek facing revenue drops that take the city back to go back to 1999 levels, and the city caught in the same economic downturn that affects the rest of the country, Pokorny said the city is having to make "significant and ongoing structural change in our organization."
In attempting to draft a balanced budget, city staff were very mindful of programs that residents put high on their list to save during a series of Community Conversations the city hosted back in the fall. Residents were asked to come up with their list of priorities, by designating how they would spend a theoretical amount of money on different programs.
In his column in the May/June issue of In the Nutshell, Pokorney said that programs that promote "Culture, Recreation and Learning Opportunties" received 24 percent of the virtual dollars, followed by programs that serve "A Safe Community." "Economic Vitality" programs would receive 18 percent. Coming up behind were programs that support "Strong Neighborhoods," and "Transportation." One hundred seventy residents participated.
"The budget that we are offering is a balanced approach in both senses of the word," Pokorny said. "That is, it is balanced between resources and expenditures, and we have used a mix of program cuts, restructuring, service reductions as necessary, some one-time money to ease the transition, and fee increases for services. All employees have also been asked to contribute through increased contributions to various benefits out of their paychecks, and most have seen a significant reduction in their take-home pay. And a few have been laid-off or had their jobs reduced to half-time this past year."
Pokorny added: "This process is difficult for everyone involved, it is not something taken lightly. It affects the lives and services of people living in this community, it affects the lives and jobs and income of the employees delivering the services."