How to make a payment they don’t have the money for greeted Oakdale City Council members at their Monday night meeting, with the pending wastewater loan payment the main topic of discussion at the Aug 20 session.
With its first installment due at the end of this month and the city’s coffers strapped, Interim City Manager Stan Feathers presented a proposal seeking authorization to make an interest only partial payment of $364,698 of the approximately $850,000 original amount.
The state water resource board is aware and has already agreed to the finance plan.
Feathers also reported that the city was short in building a reserve fund of one-year’s payment. City reports by Feathers cite a “distinct lack of coordination between the public works and finance departments” as a reason for the account not being properly funded.
Feathers informed the group that significant effort has been given to the city finances and bond obligations by city staff over the past few months and will go into the future.
“Tonight will not be the last we review this fund and service to the community,” Feathers told the group.
Initial projections by the city failed to bring in the needed revenue for the sewer fund. In 2009, the city resorted to a 10 percent rate hike on top of the flat rate already imposed, expecting obligations to be met.
Feathers speculated that the shortfall could have occurred due to foreclosures, residents tailoring usage during winter months when rates are set, or the city not growing as expected.
“We are extremely sensitive that ratepayers have had increases over the last few years,” Feathers said regarding ideas to make up the amount. “Any rate increase will have to go through the Prop 218 process.”
In November 1996, California voters passed Proposition 218 to establish rules for raising fees and taxes in the state.
From the public podium, former mayor and current city council candidate Farrell Jackson stated he believed previously agreed increases had not been imposed and if they had been properly assessed the fund would be at a better status. He also asked Feathers about a flat-rate assessment being a better option for any increase in the future.
Feathers agreed, stating that a flat rate gives the customer continuity and a better picture to budget.
As part of the proposal, Feathers was also asking for two financial advisors, at $25,000 each, for analysis, bond options, debt disclosure, and advice on city issues.
City Treasurer candidate Michael Ward asked Feathers about the city’s vulnerability of being taken advantage of by excessive billing by the proposed advisors.
Feathers told the group he was confident the advisors would be a benefit to the city. He described himself as “the most penny-pinching cynical person” and assured Ward and the council that the advisors’ work would be scrutinized.
The council voted 4-0 to pass the measure.
In other actions, the council agreed to restructure the city’s youth commission into a youth advisory council.
According to Recreation Supervisor Linda Royalty, because of the removal of the city’s volunteer coordinator through budget cuts, the Commission has not met since June 2011. The move allows more freedom from meeting formalities and allows them to operate more efficiently.
As part of their efforts to keep their jobs due to the city’s consideration of privatization of public works, the city employee union, Operating Engineers Local 3, had a large portable billboard parked adjacent to the North Second Avenue council chambers. The message stated, “Oakdale stop the outsourcing of city jobs.”
Union officials said the billboard was driven around the city on Monday and they had received a positive response from citizens.