Community Conversations searching for solutions to Morgan Hill’s
financial woes
– a $1.3 million deficit
Morgan Hill – With the city’s budget deficit projected to grow through 2011, council members say they’ll recommit themselves to fiscal discipline.
“We know we’re going through difficult times,” Councilman Larry Carr said.
The city has a projected $1.3 million deficit for the year that ends June 30 and expects an annual shortfall that reaches as high as $2.4 million in the year ending June 30, 2011.
Jack Dilles, Morgan Hill’s finance director, said the deficit will grow even though the city will add virtually no new staff or services in that time. The city will add two new police officers next year, and a third after the recently-approved 650,000 square-foot shopping center opens on Cochrane Road, east of U.S. 101.
“This [forecast] is not counting on any new growth in revenue or slashing expenditures,” Dilles said. “We’re just going to continue doing what we’re doing.”
In an effort to gauge support for new expenses, such as a fire station and expanded parks maintenance, the city has just kicked off its community conversation, a two-month series of discussions among residents and city staff.
At the meetings, residents will be given descriptions of three possible ways to erase the city’s $1.3 million budget deficit.
One would raise city taxes by $325 to $425 a family to pay for increased city services such as police and parks; a second raises taxes about $125 a family to maintain current services; a third would not raise taxes but cut services.
Those who agree that new taxes are necessary will be asked whether they prefer a new sales tax, a parcel tax or increased development impact fees.
While waiting for the results of those meetings and a possible November ballot measure, Carr said that it’s important that the council is mindful of not worsening the deficit through the year.
Earlier this month, Carr was the lone councilman to vote against a rebate for every resident who paid fees to install solar panels last year, a vote that will cost the city $9,533.
“Obviously, things are going to come up,” Carr said. “We need to look at as many things up front as possible. We need to be real circumspect and real sure about things we’re doing outside of our budget strategy.”
And that means there will likely not be funds for Mayor Dennis Kennedy’s wish to restore city-funded after school programs.
“In light of the fact that we’re operating in a budget deficit, I just don’t see how we can do that,” Kennedy said of programs that would provide tutoring, homework centers and recreational activities for the city’s school kids.
