Atwater City workshop: Officials say reserves are healthy but budget choices remain as pension and staffing requests loom

Atwater City Manager (speaker S2) opened the budget workshop with a fiscal overview, saying the city's adopted fund-balance policy targets at least 25% of operating expenses and that staff's budget projections show reserves well above that target while the draft budget carries a modest structural deficit estimate.

The city manager said the budget was adopted with a policy to hold at least a 25% operating reserve and that the adopted forecast showed a significantly higher cushion. "Our rainy day fund is pretty healthy," the city manager said. She cautioned, however, that the presence of reserves does not eliminate choices about ongoing costs, and that departments have been submitting requests for new positions and programs.

The workshop included a presentation on pension liabilities. Anna (speaker S6), who led the follow-up on February workshop questions, summarized CalPERS figures and related budget impacts. Anna said the total combined unfunded accrued liability (UAL) for city plans as of 06/30/2024 was reported as $29,700,000. She told the group that the amount the city must budget for FY26'27 to cover the scheduled UAL payment is $1,500,000, and that the city typically takes an annual prepayment option (about a 3.2% discount) that would require approximately $1,460,000 cash flow in July.

Public-safety staffing and facility costs were raised as immediate trade-offs. The police chief (speaker S5) gave a per-officer estimate: one officer's salary plus benefits would cost under $81,389; adding two officers was estimated at a little over $362,000. The chief also noted a sign-visibility issue at the police building and said illuminated signage would cost between $20,000 and $25,000 depending on options. "We're working with a local sign company to get [signage] visible for both directions," the chief said.

City staff described the budget workflow: department heads submit worksheets and requests, the city manager and staff (including Anna) compile a proposed draft, then the draft goes to the city council for amendment. The city manager said the draft budget presentation is scheduled for May and final adoption for June 8.

What happens next: staff will review requests and present a draft budget to council in May; council action on the final budget is scheduled for the June 8 meeting.