Budget: Antioch City Staff Says Council Has A Spending Problem

On Tuesday, the Antioch City Council will host a study session to discuss its budget where staff outlines a spending problem by the City Council.

During the study session, the council is being tasked to provide input and direction on the draft mid-year budget options and adjustments to the fiscal year 2023-25 budget.

According to the staff report, the city is utilizing $6.32 million in budget stabilization fund to ensure a balanced budget for the Fiscal Year 2024-25. However, by fiscal year 2027-28, staff anticipates a $13.95 million deficit. Staff also says by Fiscal Year 2027-28, it anticipates the city burning through its budget stabilization funds and it will be fully depleted.

The staff report also shows that there is a projected $950,000 decrease in sales tax. The council is also being asked to discuss a possible 1-year extension for the crisis response program with the Felton Institute for the AQCRT through November 1, 2025 in the amount of $2.1 million.

History of Warnings:

• June 2019, then councilmember Joy Motts warned the City of Antioch was going to be $12.56 million in deficit spending within the next several years.
• May of 2020, Finance Director Dawn Merchant warned the council of using Budget Stabilization fund to balance Fiscal Year 2021.
• February 2023, Merchant again sounded the alarm on deficit spending in which the city had already moved over $9 million from the budget stabilization fund which is why the city is not showing deficit spending this year.
• January 2024 – Antioch City Treasurer Lauren Posada warned on city council spending as Antioch looked at potential ballot measures to fund programs that were created using one-time monies.

The following is the Antioch Budget Summary which does not include staffing and other budget requests

City Actually Sees Increase in Revenue

• 2024 – projects increased by $362,636 for $94,935,121: The increase in fiscal year 2024 is mainly attributable to $1M increase in projected interest income and $575,000 increase in business license revenues netted with $950,000 projected decrease in sales tax (including Measure W), and $310,818 decrease in PG&E electric and gas franchise tax revenue
• 2025 – projections increased by $133,615 for $97,111,574. The increase in fiscal year 2025 is mainly due to an increase in projected interest income and business license revenues netted with a $950,000 projected decrease in sales tax (including Measure W) . The PG&E franchise tax revenue has not been adjusted down in fiscal year 2025, anticipating that the recent rate increases instituted by PG&E will negate the decrease in the tax received in fiscal year 2024.

Staffing & Other Requests — again not listed in budget projects, but would add an additional  $293,063 in Fiscal Year 2024 and $1.63 million in Fiscal Year 2025.

Staffing Requests

1. Funding of an Administrative Analyst II/III in Capital Improvement in lieu of an Administrative Analyst $18,450 – $38,819
2. General Laborer (Public Works) – $83,807
3. Two (2) Water Distribution Operators I/II (Public Works) – $134,582 – $171,330 per position
4. Two (2) Water Treatment Plant Operators (Public Works) – $389,486 – $507,056
5. Water Treatment Maintenance Worker I/II/III (Public Works) – $147,636 – $216,684
6. Water Treatment Instrument Technician I/II (Public Works) – $159,260 – $216,684
7. Fund one (1) Equipment Mechanic I/II position in lieu of one (1) Fleet Technician (PW) – budget saving of $2,006 to increased cost of $20,111 depending on position.
8. Two (2) Community Service Officers (CSOs) (Police) – net cost of $69,735
9. Fund one (1) Human Resources Specialist position in lieu of one (1) Human Resources Technician (HR) – $31,333 is the cost differential.
10. Fund one (1) Building Inspector position in lieu of one (1) Code Enforcement Officer (Community Development) – $18,549 is the cost differential.
11. Increase Recreation Part-Time Help Budget – $83,063 to expend youth services.

Other Requests

1. $12k – for community events in each District – $2,000 for each District and $4,000 for the mayor on citywide events.
2. $80k – mural program
3. $60k – City’s Cost Allocation and Fee Structure Study
4. $100k Outsourcing Internal Affairs Investigation for Antioch Police Department
5. $140k for Fleet vehicles for parking enforcement
6. $500k to replace EBRCS radios for police and city departments. $2 million to replace them all
7. $10,099 – join the United States Conference of Mayors. Membership increases 3% annually. (does allow Antioch to apply for grants otherwise not eligible).
8. $210k and $350k for concrete replacement at city parks and other parks
9. $85k for extra tree work in the street light and landscape districts.

ARPA Approved Allocations

• MAP – $625,000.00
• Mental Health Crisis Response – $3,600,000.00
• Bridge Housing Lease – $2,600,000.00
• Bridge Housing Support Services -$3,100,000.00
• Meals on Wheels – $25,000.00
• Small Business Grants – $500,000.00
• Façade Improvement Grants – $500,000.00
• Small Business Support – $1,500,000.00
• Wi-Fi Install Downtown/Maintenance – $110,000.00
• Homekey Match* – $1,377,841.00Government Services Category
• Prewett Perimeter Fence (Govt Services) – $500,000.00
• Pub Safety Comm Resources Facility (Govt Services) – $4,300,000.00
• Government Services (offset FY25 GF Expenses) – $2,813,059.00
• Total ARPA money received – $21,550,900.00

Seek $2.1 Million in Funding to Continue ASQCRT (crisis response)

ARPA funds in the amount of $3.6M were approved for mental health response. The current contract with Felton Institute, set to expire on November 30, 2024, has proven to be instrumental in providing essential services, particularly through the AQCRT.

Between July and December 2023, the AQCRT responded to an impressive 2,697 non-life-threatening 911 calls. These calls encompassed a range of crucial services, including mental health assistance, de-escalation interventions, and welfare checks.

The PSCR Department is requesting a 1-year contract extension with Felton Institute for the AQCRT through November 1, 2025 in the amount of $2,100,000. In order to fund the increase with ARPA, City Council would need to consider re-allocating funds from other approved budgets.

Project Homekey

As the City did not find it viable to apply for the last round of Homekey, City Council could consider using the $1,377,841 of the ARPA portion towards the contract extension. The remaining difference of $722,160 (from the $2.1M contract increase request) could be re-allocated from the $4.3M for the Public Safety and Community Resources Facility. The amount was originally based on a very loose estimate of rehabilitating the building on W. 10th Street, which was later determined to be over $12M to rebuild. City Council recently approved the purchase of the old PG&E facility which will now house the PSCR Department and other City staff. It is estimated that after purchase and furniture/interior redesign costs, approximately $1.7M will remain out of the $4.3M budget.

Antioch City Council – Special Meeting/Work Session

Antioch City Council Meeting
Tuesday, May 14, 2024
5:00 pm
200 H Street, Antioch CA
Full Staff Report – click here