(Dec. 23, 2008) -- A meeting of the City Council's Budget Oversight Committee, scheduled for 5 p.m. Dec. 22, drew a crowd that filled nearly half of the Council Chamber...during which city management confirmed that it was undertaking a number of measures (previously reported by LBReport.com) hoping to avoid midyear budget/service cuts...but with no guarantees.

The Committee (chair DeLong, vice chair O'Donnell, member S. Lowenthal) heard a Power Point presentation by Financial Management Director Lori Ann Farrell whose data indicated that an unplanned surge in oil revenue (from record oil prices) plus pipeline franchise fees prevented the General Fund from ending FY 08 (Sept. 30/08) with a $10 million deficit (which would have required $10 million in cuts or replacement revenue on top of $16.9 million made in Sept. 08 ini adopting the FY 09 budget).

LB City Hall's FY 08 savior: oil revenue plus pipeline franchise fees brought City Hall's General Fund roughly $14 million more than planned...producing a closing FY 08 surplus of a little over $4 million ($3 million of which management recommended putting aside in a previously established "budget stablization fund.")

However, oil prices are now significantly below the $85/barrel level management conservatively budgeted when FY 09 began (Oct. 1), and City Hall's other General Fund revenue sources are continuing to trend downward. Accordingly, management recommended (and no Committee member publicly opposed) measures outlined in Ms. Farrell's memoranda of Oct. 23 and Dec. 9 (previously detailed by LBReport.com) including a hard hiring freeze...and "exploring" furloughs for some city employees.

On questioning by Councilwoman Suja Lowenthal, Human Resources Director Suzanne Mason indicated (as also previously reported by LBReport.com) that she had begun a dialogue with city employee union reps, formal discussions on the matter hadn't yet begun pending specific instructions from her superiors.

As previously reported by LBReport.com, in Sept. 2008 Councilwoman Gerrie Schipske suggested exploring a furlough of certain management level personnel (there's no public indication that this has been discussed).

Ms. Farrell indicated that the following General Fund revenue sources ended FY 08 (Sept. 08) producing less revenue than had been planned (figures below rounded by LBReport.com):

Revenue Source	FY08 Adj Budget (millions)	FY 08 Actual Year End (millions)	Less Revenue Than Budgeted
Parking citations	$16.3	$14.0	<$2.3>
Secured property tax	$67.5	$65.4	<$2.1>
Utility Users Tax	$43.1	$41.1	<$2.0>
Motor Vehicle In Lieu (VLF + Prop Tax In Lieu)	$40.8	39.3	<$1.4>
Real Property Transfer Tax	$2	$1.1	<$.9>
Emergency Ambulance Fees	$9	$8.4	<.6>
Transient Occupancy Tax (hotel rooms)	$9.5	$9.1	<.4>

Despite this, City Hall ended FY 08 (Sept. 08) with a surplus due to the following revenue sources delivering more revenue than had been planned:

Revenue source	FY08 Adj Budget (millions)	FY 08 Actual Year End (millions)	More Revenue Than Budgeted
Uplands Oil Transfer	$12.3	$21.5	$9.2
Pipeline Franchises	$7.0	11.9	$4.9
Sales/Use Tax (incl. Triple Flip)	$52.4	$52.8	.35
Business License Tax	$11.27	$11.3	.03

With oil revenue currently at roughly $30/barrel (less than half the $85/barrel amount budgeted during the summer when oil was at over $130/barrel), management recommended placing $3 million of the FY08 roughly $4 million surplus in the "budget stabilization" fund (contains roughly $6 million from the Sempra Energy lawsuit settlement; with the FY 08 surplus, fund would total $9 million).

As previously reported by LBReport.com, city management advised the Council in November that its FY 09 budget (enacted in Sept. 08) might end up $8-$10 million in the red.

Among those present at the Budget Oversight Committee meeting: members of LBPD and LBFD command staffs, members of senior city management, City Auditor Laura Doud, Asst. City Auditor James Johnson, City Prosecutor Tom Reeves, Councilwoman Rae Gabelich, LB Firefighters Ass'n president Rich Brandt, LB Machinists Union Business Rep. Janet Janet Wright-Schabow (along with a sizable number of IAM non-public-safety city employees).

At the speakers' podium, IAM Business Rep Wright-Schabow said she wouldn't use the venue to comment on the furlough proposal directly but voiced concern over its possible tax consequences for employees. Another IAM represented employee said that if a furlough is instituted, it should affect all levels of city employees: rank and file, management, and public safety.

Councilman DeLong said that all city departments may be affected...and nothing should be off the table.