“Four-day work weeks,” “special no-parking-fee days,” “bi-weekly refuse pick-ups.”
At Tuesday’s City Council special budget workshop, some Berkeley councilmembers suggested various strategies to close the city’s staggering budget deficit, strategies that City Manager Phil Kamlarz promised to explore before returning to the council March 23.
Although the city has been able to fix a $3.8 million deficit in the current fiscal year by shifting funds around—a feat Councilmember Kriss Worthing-ton described as Mayor Tom Bates’ 72nd birthday present—it still faces a $10 million shortfall in 2010-11.
The city has already implemented hiring freezes, deferred capital projects and restructured benefits to address the budget crunch.
Revenue losses include $4 million in refuse funds, $2.7 million in public health, $500,000 in Measure B transportation funds and a $2.1 million shortage for the new Berkeley Animal Shelter project.
Although refuse funds make up the biggest chunk, Kamlarz said that a decrease in public and mental health funds was far more serious because it would have dire consequences for the city’s poorest residents.
“We have four major problems with the budget. Two of them are for mental and public health,” Kamlarz said. “None of our revenue sources has gone up. We’ll have to do the best we can and hope we don’t have to do layoffs.”
Bates asked everyone to brace for “hard times all across the board,” which could last for the next two years or more.
City Budget Manager Tracy Vesely said that since the council raised garbage collection rates last July, there has been a dramatic drop in revenue for both residential and commercial recycling and transfer stations.
Vesely said the city was discussing ways to balance the refuse budget with the Zero Waste Commission and would present more information at a Feb. 23 Refuse Fund Operations workshop.
Dan Knapp, who owns the West Berkeley recycling company Urban Ore, criticized a Feb. 9 article in the San Francisco Chronicle that singled out residential recycling and smaller, cheaper garbage bins as principal reasons for the decline in refuse revenue.
Unlike some cities which contract with private companies, the City of Berkeley hires its own employees to collect trash.
“It’s not just residential,” Knapp said. “The refuse fund deficit can be broken down into four different sections.”
Knapp pointed out that only $1.36 million (35 percent of the deficit) was from a drop in residential recycling revenue. The biggest loss, $1.42 million (37 percent), was attributed to the transfer station, followed by reductions in commercial recycling and franchise haulers.
Knapp also took issue with the article’s suggestion that a sagging construction industry had resulted in less debris at the transfer station.
“There’s lots of construction going on,” he said. “Urban Ore is booming—we’ve been since mid-2009. In fact, we are so busy that we are thinking of staying open later at night.”
Mary Lou Van Deventer, Urban Ore operations manager and president of the Northern California Recycling Association, urged the city to think of a new financial model that would provide for “resource pricing instead of garbage pricing.”
“The refuse fund has been a cash cow for the city until recently and it can be again,” Van Deventer said. “One problem in its structure is that it taxes the devil (garbage) to finance the angels (recycling). In that case, the angels don’t have sustainable financing without the devils, so if the angels do a really good job, you need more devils. That’s a bad position to be in. The angels need their own self-sustaining financing.”
Mark Gorrell from the Ecology Center and his wife Nancy from the Community Conservation Center urged the council to preserve recycling.
“What about refuse pick-up every other week instead of every week?” asked Councilmember Susan Wengraf. “I have talked to several constituents and they have told me that their cans are never full.”
Kamlarz said he’d have to look into the health and safety issues involved in that idea.
Van Deventer said the City of Berkeley had considered the plan in the past before abandoning it. She said the city could follow the example of Toronto, which had figured out a way to do it.
As for dealing with other parts of the budget mess, Councilmember Darryl Moore suggested that shorter work weeks might be a better trade-off than furloughs or voluntary time off for city employees
“Figure out how to get people to the city to spend their dwindling money,” proposed Councilmember Max Anderson, calling for a highly publicized day of free parking in the city to boost sales tax.
Kamlarz cautioned the council that the city’s attempt to attract more shoppers by hosting free parking days in the past had met with little success.
Despite protests from some members of the Humane Commission, the City Council voted to approve a funding mechanism concept for the new Berkeley Animal shelter.
Because construction bids came out a lot higher than expected, the project —which would relocate the existing operation from 2013 Second St. to a new two-story, 100-animal-capacity shelter at the northern edge of Aquatic Park—is facing a $2.1 million deficit.
The city has recommended selling certificates of participation to investors for a higher interest rate to fund the shortfall so that there is no urgency to sell the current site at a lower price during a weak real estate market.
However, humane commissioner Jill Posener asked the council not to rush into the building project, instead requesting a re-evaluation of the building’s seismic safety standards and other features.
Kamlarz responded, “The longer we wait, the more it’s going to cost.”
He stressed that the budget for the shelter had grown from $7.2 million to $12.5 million over the last seven years.
“If we wait till 2012, it will grow to $13.5 million,” he said.
Councilmember Linda Maio said that although the shelter was not perfect, “there was no really good reason to hold it back.”
Kamlarz indicated that he was open to addressing any outstanding concerns as the project moved forward.