Strong Fiscal Management and Infrastructure Maintenance and Repair

By Carol J. Federighi

Lafayette is fortunate to be fiscally healthy. The Council has budgeted conservatively, allowing us to maintain a healthy reserve (50% of our annual General Fund budget). As a result, we enjoy the highest bond rating of any city in Contra Costa County.

We face some severe challenges to our fiscal health, however. A very challenging business climate and State budget deficits threaten our revenues. Although home values in Lafayette remain high, we have fewer sales than in the past, and sales tax revenues have gone down. We expect the State will be taking away $230K of our 2008-2009 Redevelopment Funds to help meet its budget.

We must continue to spend our limited dollars prudently and make certain that the uses to which we put them are cost-effective. I support long-range planning, strong fiscal management and retention of a healthy reserve. The Council has appointed a volunteer Blue Ribbon committee charged with examining our budgets carefully and making recommendations to us as to where we can safely economize and where we might be able to obtain other revenues. We should be getting a report soon. Our Parks and Recreation program already pays for itself, and planning fees have been raised to better reflect the cost of planning services. In addition, the Council is increasing some impact fees. We anticipate that our General Fund revenues for 2008-2009 will be $11.5 million. Expenditures will be closer to $13.9 million, only because we had excess reserves to which we are largely allocating to roads. Over 33.2% of our budget goes for police services (and we have the lowest per capital expenditure for police of any incorporated city in Contra Costa County,). An additional 36.2% of the budget goes for capital improvements (and public works. The remainder of the General Fund supports administration, planning and engineering, rent and expenses, Council/commission support, and other needs.

Road maintenance, repair and reconstruction of our public roads is a top priority for me. The Council has allocated excess reserves to roads in several of the last few years. I believe this was an excellent investment: the cost of totally reconstructing roads can run as much as ten times the amount required to maintain a road. We also take advantage of grant funding where available. Ninety percent of the funding required for the recent repair of Mt. Diablo Blvd., the most highly used local road in Lafayette, came from state and federal grants. Because of our investment in infrastructure, we have reduced what was a $29 million dollar gap in 2004 (between revenues and expenditures needed to bring all public roads up to a good condition) to an $18 million gap today. I will continue to work to narrow the current funding gap. But we must be clear: current revenue streams simply will not produce the revenues needed to bring all of our roads up to a good condition any time soon.