Today marks the official start of a new fiscal year, and recently the Modesto City Council adopted a stable, balanced budget with the intention of providing for critical infrastructure and services. The budget was adopted with confidence that our city is making great economic improvements, and with caution due to the fiscal challenges we face this next year and in the years to come.
Our local economy is improving, and we continue to see an increase in revenue from property, business license and sales taxes, which account for 59.2% of General Fund revenues. During fiscal year 2018/2019, the city council approved the sale of Cannabis within city limits. Eight dispensaries were approved to sell cannabis, and the Cannabis Tax will provide the city with a new revenue source in this and future fiscal years.
Our initial projections show significant increases in CalPERS - city employee and retiree retirement program - contributions for this upcoming fiscal year, and the increases will continue in subsequent years. In short, pension costs, among overall expenditures, continue to outpace the growth in revenue.
We have a strong team in place that will reimagine the way we provide the same level – or better – of service to our community despite the budget challenges.
A few consistent themes you will notice in the upcoming budget year:
- Public safety will remain our priority, and that also means addressing the well-being of those experiencing homelessness.
- We want to be known as an organization focused on the customer experience.
- We will align resources to be an innovative and solutions-oriented organization.
- The city is finalizing a refreshed Strategic Plan to guide staff on priorities of the city council.
- Staff will actively manage vacancies, as they occur, to ensure resources are available to meet future budget challenges.
- We will work toward an aggressive pro-business approach to expand existing businesses and attract new businesses.
- We will invest in collaborative partnerships with other jurisdictions, business community, our neighborhood groups and faith organizations.
- We will strive for an open transparent government and will make decisions based on data and evidence.
Be on the look out for a new Citizen's Budget Guide, which will be unveiled within the next few weeks. This guide, the first of its kind for Modesto, will creatively position the city's budget numbers and process in such a way that gives our residents and stakeholders a simple way of understanding where their taxes and fees go.
I'm excited about this new tool, and I'm excited about what we will - together - accomplish this new year.