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HomeMy WebLinkAboutRES NO 014-10 RESOLUTION NO. O 14- 10 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF BAKERSFIELD DECLARING A SEVERE FISCAL HARDSHIP. WHEREAS, the current economic crisis has placed cities under incredible financial pressure and caused city officials throughout the State to reopen already adopted budgets to make painful cuts, including layoffs and furloughs of city workers, decreasing maintenance and operations of public facilities, and reductions in direct services to keep spending in line with declining revenues; and WHEREAS, in light of these circumstances, the City of Bakersfield has been instituting budget reductions measures on a continual basis, The adopted 2008- 09 City Budget included 60 frozen positions and 5 displacements. Further mid- year budget cuts resulted in the elimination of 106 vacant positions; and WHEREAS, the adopted 2009-10 City Budget included a reduction of 141 positions and $15.8 million from the General Fund compared to FY 2008-09; and WHEREAS, the Bakersfield City Council adopted Resolution No. 059-09 on May 12, 2009 declaring that if the State of California "borrowed" $2 billion in local property tax funds from local governments that the City of Bakersfield would experience a severe fiscal hardship; and WHEREAS, the State of California did include a borrowing of local property taxes in their FY 2009-10 budget, capturing $6.7 million in revenue from the City of Bakersfield's General Fund; and WHEREAS, due to the continued financial downturn in the national and regional economy, the City has experienced unprecedented declines in sales tax revenues, including significant declines in eleven of the last twelve quarters, as compared to the same quarter of the previous year; and WHEREAS, due to recent investment losses by the Public Employees Retirement System (PERS), the City's PERS rates are gradually increasing, (beginning in FY 2011-12) and reaching an estimated annual increase of $7,5 million in FY 2013-14, which will continue for the next thirty years; and S:\Steve 7eglla\Resolutions\Fiscal Emergency_StBV@ VerSIOr1.dOCX Page 1 of 3 Pages - c.; ,r"P!G!N- 0J WHEREAS, the City of Bakersfield currently faces an approximate General Fund deficit of: $8.7 million for the 2010-11 fiscal year, and $14 million for the 2011-12 fiscal year, and WHEREAS, on January 27, 2010, the Bakersfield City Council adopted mid- year budget adjustments for the FY 2009-10 budget which included significant reductions in Property Tax, Sales Tax, and permit fee revenue estimates, as well as an $8.07 million reduction in General Fund Appropriations; and WHEREAS, the State of California is considering multiple revisions to the State budget which may result in further reductions in City revenues; and WHEREAS, the combined effects of the seizure of the City's property taxes, increasing unfunded state mandates, and the revenue losses due to the economic downturn have placed the City's budget under continued serious fiscal pressure; and WHEREAS, the Bakersfield City Council and City Staff have instituted various austerity measures including severe controls on hiring and multiple financial expenditure and operating cuts; and WHEREAS, immediate and comprehensive action to reduce current spending must be taken to ensure, to the maximum extent possible, that the essential services of the City are not jeopardized. NOW, INCORPORATING ALL OF THE ABOVE RECITALS HEREIN, THEREFORE, BE IT RESOLVED by the Council of the City of Bakersfield as follows: 1. The City is in a state of severe fiscal hardship; 2. The above recitals are true and correct; and 3. This resolution shall take effect immediately upon its adoption by the City Council, and the City Clerk shall certify the vote adopting this resolution. ---00000--- S:\SteveTeglla\Resolutlons\Fiscal Emergency_steve verslorl.docx f- Page 2 of 3 Pages •J '1Ft~r,~i~ft~.1 HEREBY CERTIFY that the foregoing Resolution was passed and adopted by the Council of the City of Bakersfield at a regular meeting thereof held on FEB 17 201a , by the following vote: AYES: COUNCILMEMBER: CARSON, BENHAM, WEIR, HANSON, SULLIVAN, SCRIVNER COUNCILMEMBER: COUNCILMEMBER: ABSENT: COUNCILMEMBER: ROBERTA GAFFORD, C CITY CLERK and Ex Officio Clerk of the Council of the City of Bakersfield APPROVED: FEB 17 2010 By , 9 at HARVEY L. HALL Mayor APPROVED as to form: VIRGINIA GENNARO City Attorney By: IN A. CRUMLEY Associate City Attorney JAC Asc }S:\Steve Teglla\Resolutions\Fiscal Emergency_StBVe VerSIOn.CIOCX O= Page 3 of 3 Pages