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Riverside Sees Sunny Budget, With Caveats

With new projects planned, the general fund and state financial crisis are caution factors.

May 14, 2003|Seema Mehta | Times Staff Writer

Riverside's city manager laid out the details of the city's proposed $565-million budget Tuesday night, saying the city has healthy reserves and plans to move ahead with a list of new projects.

Still, City Manager George Caravalho told City Council members that there are budget challenges because Riverside, in the past, has spent more than it collects in revenue.

"We are like multiple businesses.... Some are doing well; others are not doing as well," Caravalho told the council.

Despite the uncertainties, the proposed budget is rosier than in many other Southern California cities, and with a $22-million reserve the city has a greater ability to absorb the fallout of the current state budget crisis.

While many cities in Los Angeles and Orange counties are slashing budgets and cutting services, Riverside's proposed budget is an increase of about 11% over the current year's and will fund construction of a power plant, beautification projects and athletic fields for children.

Caravalho said the city's brighter economic picture stems from strong development and job growth throughout the Inland Empire.

Still, some council members remained cautious and were recommending a high degree of caution, especially with the looming fiscal crisis in Sacramento.

"We need to look at some cuts with the budget. We don't know what the state is going to do," Councilman Ed Adkison said shortly before the budget proposal was presented to the council Tuesday night.

The state's budget problems could mean millions less for the city. But city officials have bulked up their reserves over the last three years and don't anticipate layoffs or shortfalls. They also plan to save money by eliminating vacant positions.

The general fund, which covers core city services such as police, firefighting, parks and streets, would grow 3.8% to $148 million.

But in recent years, general-fund spending has outpaced its revenue. Previously, the difference was made up using money left over from earlier years. To help cut the difference in half, this year's proposal eliminates nearly 17 full-time positions by leaving vacancies unfilled or funding them from sources other than general revenue.

The City Council has scheduled a public hearing on the proposed budget for June 10 and adoption of a budget for June 24.

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