SH City Council agrees to save budget surplus of $1.07 million

Graph discussed at the Signal Hill City Council meeting Jan. 22 showing municipal revenues as higher than expenses for fiscal year 2017-2018, resulting in a $1.07-million budget surplus that the council agreed to add to its reserve funds

During its Jan. 22 meeting, the Signal Hill City Council discussed a municipal financial report for the fiscal year 2017-18, now audited, which shows a budget surplus of $1.07 million. The council agreed to transfer the entire amount– a result of higher than expected revenue and lower than budgeted municipal expenses– to the city’s reserve funds.
Financial report
Finance Director Scott Williams presented the council with the comprehensive annual financial report (CAFR) for Fiscal Year July 1, 2017 to June 30, 2018, noting that its purpose is to inform not only Signal Hill leaders and residents, but also creditors, investors and rating agencies.
“The CAFR is the year in review,” he said. “This is an opportunity to fully understand how the organization performed this last fiscal year. […] Standardization, transparency and full disclosure– that’s the purpose of this.”
The audited report shows a general-fund operating-budget surplus of $1,071,008. Williams said that the surplus was mostly a result of revenues– primarily property-tax revenue– that had come in higher than budgeted two years ago, with total revenue at $21.8 million compared to $21.4 budgeted. Plus, City departments had kept expenses at about $400,000 below a budget of $21.2 million.
Sales-tax revenue accounted for nearly 70 percent, or $15.1 million, of total revenues, with property taxes accounting for 10 percent, or $2.2 million, Williams said.
Of expenses, the police department accounted for 45 percent of the total, or about $9 million, with the public-works department accounting for 20 percent, or about $4 million, and general administration at 22 percent.
“What occupies a primary place for the City’s general-fund expenditures is our safety and infrastructure, and that is as expected,” Williams said.
Williams also broke down the City’s long-term liabilities, of which 76 percent, or $28.4 million, are for pensions, with another $9 million for other retirement benefits, especially medical insurance.
“The funding level of our pension is at or slightly above average,” Williams said.
The council agreed to distribute the $1.07-million surplus among several reserve funds. City Manager Charlie Honeycutt said that the distribution is based on the short- and long-term fiscal needs of the city.
About half of the total, or $500,000, will be added to the City’s economic reserves.
“We haven’t changed the economic-uncertainties fund in a couple of years, so we’re recommending $350,000 be added to that,” Williams said. “The year before, we started the new economic-development fund and funded it with $500,000 from last year’s budget savings, and we’re recommending another $150,000 be added to that.”
Of the remainder, Williams said that $100,000 will be added to pension reserves and $150,000 allocated to an ADA (American Disabilities Act) study. Another $155,000 will be reserved to replace the City’s and police department’s data servers.
Vice Mayor Larry Forester commended City departments for watching expenses.
“There are other cities that would have seen that money as a million dollars to spend,” Forester said.
“We see it as a million to save,” Mayor Tina Hansen added.
The council then decided on May 30 as the date it will conduct its annual budget workshop to decide on the 2019-20 Fiscal Year budget, scheduled for adoption by June 25 and implemented July 1.
Three presentations
Hansen and Williams introduced Cristal Martinez, a new account specialist with the finance department. Martinez is working on her master’s degree in accountancy and has six years of accounting experience, Hansen said.

Photos by Anita W. Harris | Signal Tribune
During the Jan. 22 Signal Hill City Council meeting, Mayor Tina Hansen (center) and Finance Director Scott Williams (right) introduced Cristal Martinez, a new account specialist with the finance department.
“Working with such a team that is looking to move forward has been […] really inspirational,” Martinez said.
During the council’s “small-business spotlight,” Marcelo Perdomo promoted his martial-arts studio, called Brazilian Top Team, located at 2680 Dawson Ave.
He said that anyone 4 years and older can enroll. And, as head coach, he said he has seen women learn to defend themselves and men grow in confidence.
“We are one of the most successful schools in the world for Jiu-Jitsu and MMA (mixed martial-arts),” Perdomo said. “We have created many champions […] but the thing we’re most proud of is creating better citizens.”
During the Jan. 22 Signal Hill City Council meeting’s “small-business spotlight,” Mayor Tina Hansen (right) presented a certificate to Marcelo Perdomo, owner of martial-arts school Brazilian Top Team, located at 2680 Dawson Ave.
Kelli Tunnicliff, public-works director, thanked a team of public-works employees– five of whom attended the meeting– for installing material at nine sites around the city to facilitate cleaner stormwater runoff.
Such materials include gravel, straw-waddle and wood-fiber hydraulic mulch, and are required to comply with a vacant-parcel ordinance the council approved last year to reduce pollutants running into local rivers, Tunnicliff said.
“The sites have held up well in the recent rain events,” she said.
Sanitation workers
During public business, engineer David Walbeck, a member of the union representing Los Angeles County Sanitation Districts (SD) workers, asked the council for help preserving sanitation-worker compensation.
“The sanitation districts are embroiled in labor-management turmoil,” Walbeck said. “Our long-standing impasse in negotiations can spill over to the communities we serve, including Signal Hill.”
He added that sanitation union members are demoralized and willing to strike if necessary.
Union members had also approached the council last month, as reported in the Signal Tribune. This time, Walbeck asked the council to sign a letter asking SD management to back down from cutting worker compensation.
He said that council members can help since they are also board members of the Signal Hill sanitation district and Hansen is on SD’s personnel committee.
“We ask you to exert your influence,” Walbeck said. “This has been very frustrating for the employees,” he said. “We feel like we don’t have a voice in this process.”
Councilmember Lori Woods later said that the council is cognizant of the sanitation workers’ plight.
“Now that they’ve come twice to council,” Woods said, “I want the public to be aware that we are very familiar with the situation and the whole council is of the same agreement as to how to move forward with the employees.”
The next Signal Hill City Council meeting will take place Tuesday, Feb. 12, at 7pm in the council chamber at 2175 Cherry Ave.

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