The Police Department saved almost $250,000, much of it unintentional — jobs were unfilled. The Fire Department saved $265,000, primarily by reducing overtime costs. Unfilled vacancies in Public Works saved $220,000.
Not only the General Fund showed improvement, Frank said.
Other funds also ended up healthier. The Capital Improvement Fund was $470,000 higher. The Sewer Fund was pumped up by an additional $1 million when 30-year bonds to fund facilities in Aliso Canyon were retired and the reserve fund paid more than expected.
The bad news is that similar departmental savings won’t be repeated in the current fiscal year because most police vacancies have been filled, departments have already pared their 2009-10 budgets and other agencies are not hiring, so there is less attrition.
A lower-than-expected Insurance Fund balance also has Frank concerned. Higher claims reduced the fund $140,000 less than was projected, which is a little worrisome, Frank said, because the 2009-10 budget pared the allocation for workers’ compensation.
The “terrible” news came from the California Public Employees Retirement System.
“It is excruciating,” Frank said. “PERS has promulgated projected rate increases based on a 28% investment loss in fiscal year 2008-09.
“CalPERS is doing everything possible to juggle the books and lessen the horrendous rate increases, which are coming.”
Laguna Beach is facing increases beginning in July of each fiscal year of $470,000 in 2011, $790,000 in 2012 and $830,000 in 2013.
Frank foresees massive city deficits in the coming years: jumping from $1.2 million this fiscal year to $4.1 million in 2013-14.
