Sunday, September 14, 2014
FAIRFIELD-SUISUN, CALIFORNIA
99 CENTS

Suisun finances look better, but still face challenges

By
From page A8 | February 19, 2014 |

SUISUN CITY — City Council members heard good news tempered by caution Tuesday while reviewing the midyear budget.

Jason Garben, the city’s economic development director and chief financial officer, said halfway through its budget year, the city is seeing $689,100 more in revenue than it anticipated in the 2013-14 fiscal year budget flowing into its coffers. But Garben warned the council not to rest easy because of two fiscal challenges that could drain that money away – and more.

One is a year-long delay in the opening of the Walmart supercenter that’s planned for the east side of Suisun City, which is delaying an anticipated inflow of sales tax income from the store. The other is the yet-to-be determined outcome of a legal battle between Suisun City and the state Department of Finance over a $1.75 million repayment to the city from its former redevelopment agency.

Garben’s report was a midyear budget review to show the council where it stood financially.

According to Garben’s report, the city started its 2013-14 fiscal year with $3.3 million in the bank and is now estimated to collect a total of $9.15 million in income, a considerable jump from the originally estimated $8.46 million in the budget. It is spending $9.9 million this fiscal year, which is $165,300 more than it initially planned.

“The bulk of this is in personnel services,” Garben said.

Last fiscal year, Suisun City got $253,500 less than it expected, partly due to the delay in building the Walmart. It also spent $273,600 more than initially budgeted, largely due to turnover in the Police Department and legal expenses.

The city experienced declining revenues for the past five years due the recession and the loss of redevelopment. It spent that time cutting expenditures and slowly spending down the money it got from selling land on Twin Sisters in a bridging strategy that counted on Walmart opening this July.

Walmart’s opening has been delayed until 2015, and so has the start of a predicted $1.1 million in annual sales tax income. A recovering economy has allowed Suisun City to get more revenue in other areas, which has offset the increased costs of paying for employee health care and retirement costs, and city utility costs.

At present, Walmart is expected to award construction bids by the end of this month with the opening date for the store pegged for spring 2015. Every month Walmart is not open, the city estimates it will lose $92,000 in sale tax income.

Suisun City is also battling in court with the state Department of Finance over the city’s $1.75 repayment of a loan from the redevelopment agency to improve the streets at Harbor Center. If the state wins in court, Suisun City will get $262,500 of that loan, losing $1.49 million, which represents most of the city’s general fund emergency reserve.

“Taking these two worst-case scenarios together, current reserves basically cover both risks, leaving the city with no reserves,” Garben wrote in his report to the council.

Garben wrapped up his report by saying the city will have a clearer view within a month’s time of what will happen with Walmart and the outcome of the legal struggle with the state.

“These are things we certainly need to keep an eye on,” Garben said.

Reach Ian Thompson at 427-6976 or ithompson@dailyrepublic.net. Follow him on Twitter at www.twitter.com/ithompsondr.

Ian Thompson

Ian Thompson

Ian Thompson has worked for the Daily Republic longer than he cares to remember. A native of Oregon and a graduate of the University of Oregon, he pines for the motherland still. He covers Vacaville and Travis Air Force Base for the Daily Republic. He is an avid military history buff, wargamer and loves the great outdoors.
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Discussion | 1 comment

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  • Rich GiddensFebruary 19, 2014 - 1:43 pm

    ''What will happen with WalMart''----yeah right! If WalMart was going to build a neighborhood denigrating Superstore in our midst then they would have done it by now! What business sense does it make to build 2 big box stores within 3 miles of each other? Soon the logical question will be ''how long has the city and its horrible officials known that Walmart got cold feet and decided against building?" Will the news be released late on a Friday afternoon at the start of a 3 day holiday? I believe so, but as long as I'm stuck in this foul state of blighted neighborhoods and lying government officials, you will not hear silence from me!

    Reply | Report abusive comment
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