Atwater passes balanced budget, no job cuts despite COVID-19’s impact to Valley economies
Congratulations all around were given at Atwater City Council this week, as the city passed a balanced budget for just the second time in a row in recent years — despite economic loss due to the coronavirus pandemic.
Atwater’s adopted fiscal year 2020-21 budget for all funds comes to about $77.8 million. Officials described the budget as sustainable, as it doesn’t touch the city’s reserve funds and includes no job cuts.
“I am excited to see there are no furloughs,” said Councilmember Danny Ambriz. “No one is losing their job,”
Revenues for the 2020-21 general fund budget tally about $13.88 million with appropriations of $13.85 million, estimating $35,713 in surplus revenue. The prior fiscal year opened with a general fund positive fund balance of $705,166 and is projected to end on June 30 with a positive balance of $1.2 million.
“This is the second consecutive year that the City of Atwater has enjoyed the pleasure of having a general fund positive balance,” said Finance Director and Treasurer Kellie Jacobs-Hunter.
Atwater’s general fund balance for the preceding eight fiscal years had been in the red. The city struggled financially for several years, to the point of considering filing for bankruptcy in 2012.
In October of last year, Atwater was listed by the California State Auditor’s Office as the second most financially distressed city in the state.
Data from the 2016-17 fiscal year showed Atwater to be high risk in the categories of liquidity, debt burden, general fund reserves, pension funding and post-employment benefit funding.
City leaders have said recently that Atwater never truly recovered from the recession 10 years ago, compounding their fear of what COVID-19 related business closures could mean for the local economy in the short and long term. Such concerns drove the city to allow all its businesses to open in May ahead of state approval and in defiance of Gov. Gavin Newsom’s staged reopening guidelines.
Revenue lost on account of state-mandated closures are projected by city officials to be around 20%, or about $640,000 less.
Despite the “drastic” reduction in economic activity, City Manager Lori Waterman expressed optimism.
“I’m confident that Atwater will emerge and recover from this global health crisis,” she said.
In light of Atwater’s issues, each councilmember Monday praised city staff on working toward turning the financial situation around.
City officials noted that other budgets locally have not been as fortunate, like the eight occupied jobs cut at the county level to cut expenses after economic stress from the pandemic.
“Your council’s listened to everyone, we’ve heard you loud and clear the last few years,” Mayor Paul Creighton said to Atwater residents at the meeting. He added that the city has put money away for a “rainy day,” while also working on projects like paving Winton Way, building a splash pad and opening new businesses.
Over half of the general fund budget is slated to go toward police and fire, with allocations of about $5.4 million and $2.2 million respectively.
The total budget also includes $25.3 million appropriated for remediation of the carcinogenic chemical 1,2,3-Trichloropropane (TCP), which was found in several city wells.
Restoring the wells was formally declared as one of the city’s top priorities earlier this year. Officials took steps to ensure the $43 million received in settlement from oil giant Shell and chemical company Dow is safeguarded for the sole purpose of TCP remediation.
This story was originally published June 24, 2020 at 1:08 PM.
