Berkeley City Manager Phil Kamlarz told councilmembers Tuesday night that the city was prepared to absorb the hits that are the result of the recent adoption of the State of California’s 2008-09 budget. Possible further cuts to Berkeley’s $321 million city budget, stemming from the state’s ongoing financial crisis, may be another matter, however.
Kamlarz said that the $1.7 million in cuts made necessary by the final state budget agreement last month was offset by a $1.8 million contingency amount “we already set aside in the budget” for possible state cuts.
The city manager added, “We can deal with it.”
Those state cutbacks include $80,000 in health care services and another $400,000 in mental health services.
Following the meeting, Kamlarz also said that, unlike neighboring Oakland, Berkeley will not take a large state hit to its redevelopment funds because the city has such a small redevelopment district. Oakland officials reported this month that the city will lose $8.7 million in redevelopment money, which will have to be paid to Sacramento to help balance the state’s budget. Berkeley’s hit on redevelopment money will be $135,000.
But with the Sacramento Bee reporting that State Senate President Don Perata is estimating that the recently passed ’08–’09 budget may be $3 billion to $5 billion out of balance—with the strong possibility that the legislature may have to make further cuts before the first of the year—Kamlarz said that Berkeley officials will just have to wait and see if there are further impacts on city funds.
Kamlarz also said that city staff was still analyzing the effect of “a number of vetoes [by the governor at the end of the legislative session], which may also have an impact” on Berkeley’s budget.
Berkeley Mayor Tom Bates called the announcements “not great news.”