Oakland’s Biennial Budget Process Starts Wednesday – And It Won’t Be Easy

For the past six years, Make Oakland Better Now! has aimed to provide  citizens with information about the Oakland budget process. Budgets reflect government priorities, and we think that fact makes them pretty important. With the first public  budget hearing tomorrow, we begin our posting about the process today.

As most people who follow Oakland government know, Oakland enacts city budgets in odd-numbered years for two fiscal year periods. As the next fiscal year starts on July 1, 2015, the process of developing the 2015-2017 city budget has already started in the City Administrator’s office, and public hearings need to start now. In fact, the first public hearing is tomorrow, Wednesday, January 28 at 9:00 a.m. at a special city council meeting at City Hall. (Also available live at KTOP, Comcast Channel 10 / ATT U-Verse Channel 99, or streaming on line here.) This will be the start of a five-month process.

In 2013, Oakland’s City Council enacted an ordinance establishing procedures for its budgeting process, and last month, this was made a part of Oakland’s new Consolidated Fiscal Policy, which combined a variety of previously passed ordinances relating to reserves, a “rainy day fund,” use of one time sources of revenue and other budget policy matters. Part of this policy ordinance sets out a timeline for the budget process, and based on the timeline, the Budget Office is proposing the following schedule:

  • January 2015 – Council Meeting on budget priorities
  • Feb 24, 2015 – Release of Public Poll on Budget Priorities
  • February 24, 2015 – Release of the FY 2014-15 2nd Quarter R&E [Revenue and Expenditure] Report and Five-Year Forecast
  • March 15, 2015 – Statement of Councilmember Priorities
  • April 15, 2015 – CAO [City Administrator’s Office] Budget Outlook Message & Calendar Report
  • Late April 2015 – Release of the Mayor’s Proposed Budget and Fact sheet
  • May 1 to June 10, 2015 – Community Budget Forums
  • May 26, 2015 – Release of the 3rd Quarter R&E Report
  • June 1- Budget Advisory Committee’s Report
  • June 2015 – Council Deliberations, Budget Amendments, and Budget Adoption by June 30th

Budget debates are always volatile, and there is no reason to think this will be otherwise. Every city union contract other than Firefighters expires June 30. The mayor has promised to increase the size of the police department, department attrition seems to be on the rise (and it costs about $100,000 to recruit and train each new officer), and there are a significant number of current or upcoming expenditure increases over which the city will have no control. Among these are:

Escalating retirement costs ($13.4M), Grant expirations for police ($8.4M),  Match for new COPS grant ($2.5M), Public Ethics Measure ($0.6M), Fire contract cost increases ($1.7M), Minimum wage measure ($0.3M), Technology – Radio financing ($2.7M)   Technology — IT internal service fund ($9M)  Affordable Housing Trust Fund ($4M)

Oaklanders who follow budget matters also know that Oakland has a General Purpose Fund, comprising slightly less than half the city’s budgeted revenue and expenditures, and a large number of other funds, use of most of which are restricted. The budget office’s preliminary baseline for the General Purpose Fund and for all funds shows significant deficits, even before anything is added:

2015 Baseline budget overview

Long story short:  before the city even gets to questions of what more needs to be done and how to do it, and before it addresses its backlog of road repairs, building and other infrastructure repairs and unfunded or underfunded benefits, Oakland faces a deficit for the coming fiscal year of about $51 million.

The only report posted for this meeting is a short memo with a Power Point presentation, available here.

MOBN! will be closely following and writing about this entire process as it develops, as the Council and Mayor express their priorities, and as those priorities are translated into dollars and cents.

Make Oakland Better Now!

OakTalk Here is the blog of Make Oakland Better Now!, an Oakland community grassroots group of a grass-roots group of voters, volunteers, and policy advocates committed to improving the City of Oakland by focusing on public safety, public works, and responsible budgets. Founded in 2003, we’ve researched, lobbied, and successfully campaigned for a number of new, impactful policies, including the city’s Rainy Day Fund, Measure Z and Operation Ceasefire.

This Post Has 4 Comments

  1. Len Raphael

    Your post answered my question about who paid for the budget oriented telephone poll that was conducted recently. One polled subject told me that there were quite a few questions probing support for higher taxes vs cuts/increases to specific services.

    But there were no questions about pay or benefit raises, freezes, or cuts.

    Maybe the unspoken responses to those unasked questions can be derived from the respondents who oppose both tax increases and service cuts.

    How politicians frame policy alternatives is a large part of their power/leadership.

    Since our elected officials have delayed sustainable fiscal solutions for so many years, it’s long overdue for them to start conversations with residents that include compensation/benefit freezes and cuts instead of just service cuts and tax increases.

    Len Raphael, CPA

  2. Joe B.

    Where do I join the effort to use this opportunity to normalize staff budgets that have gotten out of control? Oakland gives away so much more than other cities to our employees and gets back less in services. For example, police officers can retire at age 50 here, even if all they did was push paper the whole time. That’s outrageous!

    We are running a huge deficit when the local economy and real estate is largely good. Guess what happens in the next downturn, which has historically happened every 5-10 years?

    My thanks to MOBN for your continued efforts at good government.

  3. Hobart Johnson

    I’m certainly looking forward to Oakland’s coming failures to meet budget schedule deadlines.

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