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OAKLAND — Halfway through the fiscal year, the Oakland Police Department is on track to exceed its budget by $12.9 million, mostly because of overtime pay.
Despite that, however, the city is expected to end this fiscal year with a $6.37 million surplus — thanks to Oakland's still-scorching housing market, which is pumping unprecedented levels of real estate taxes into the treasury, said Budget Director Marianna Marysheva.
At a meeting Tuesday of the Oakland City Council's Finance and Management Committee, council President Ignacio De La Fuente warned against being fooled into thinking Oakland's budget picture is "rosy."
"It's a tough road ahead of us," nominal surplus or not, De La Fuente said.
Although this fiscal year will end with a surplus, it won't wipe out a
$31.7 million shortfall projected for fiscal 2005-06, which begins July 1. And without long-term solutions, the city also faces a $26.4 million shortfall in 2006-07. Under state law, the council must approve a balanced budget.
Revenue from the city's real estate transfer tax is projected to be 19 percent higher than last year. But that is a conservative estimate, because city officials are concerned Oakland "may be experiencing a real estate bubble."
Councilmember Jean Quan (Montclair-Laurel) called for the city to set aside at least some of this year's windfall for capital projects rather than continuing to spend it on ongoing programs and to cover overspending.
"We're not going to have it to rescue us forever," Quan said.
Vice Mayor Jane Brunner (North Oakland) said she would favor using the
extra money to restore some of the benefits that the city's employee unions agreed to return to help the city balance its budget two years ago.
Jeffrey Levin, vice president of the Professional and Technical Engineers Union Local 21, said his union is frustrated that the police department continued to "eat up" the surplus.
"Our members are not willing to make these sorts of sacrifices to enable police overspending," Levin said.
The police department is expected to spend $18.38 million on overtime, a 50 percent increase over last year and $7.15 million more than budgeted, Marysheva said. In addition, the department is on pace to exceed its budget for salaries and benefits by about $5.7 million.
In an effort to reduce the spending, the Oakland City Council hired Public Financial Management
Inc. last month to audit the police department. The Philadelphia-based firm's report is due in April.
When pressed by Brunner on what the department is doing to reduce its spending in the meantime, Interim Police Chief Wayne Tucker told the committee he cut the number of supervisors in the jail and communication divisions and put one lieutenant in charge of both the West Oakland and Metro police services area to free up a half-dozen sergeants.
Other proposals on Tucker's desk will be more difficult to implement, including a plan to reduce the minimum number of officers required in each of Oakland's 57 patrol beats, as well as the number of walking officers. In addition, Tucker said he wants to shift some traffic officers from the relatively uneventful day shifts to the much busier night shifts.
But such changes would need the approval of both the council and the powerful Oakland Police Officers Association.
"We want to provide the same level of service, but cheaper," Tucker said.
The police department finished the 2003-04 fiscal year $10.9 million over budget.
The only other city department in the red is Cultural Arts, because of overspending at the Oakland Museum and Malonga Casquelourd Center for the Arts. After a city report in December discovered the department was on track to go $550,000 over budget, it cut security and janitorial services.
The cuts, which total $74,000, put the artifacts on display at the museum at additional risk of being broken or stolen and reduce the number of people available to field questions from the public. Other cuts could mean layoffs and significant
service cuts, according to the report.
The Department of Parks and Recreation is on pace to stay within its budget after reducing spending on personnel and maintenance spending. In December, the department was expected to exceed its budget by $570,000.
E-mail Heather MacDonald at hmacdonald@angnewspapers.com.
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