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Pandemic recovery

City of Napa reinvests in parks and infrastructure with budget surplus

Napa City Hall sign

Outside Napa City Hall.

The city of Napa is pouring funds back into local park improvements, sidewalks, equipment replacements and other areas previously cut back early in the pandemic after receiving more revenue than expected during the past financial year.

The Napa City Council voted unanimously this week to allocate a projected $5.44 million revenue surplus from the 2020-2021 fiscal year — which ended as July started — back into several areas that received cuts because of an anticipated financial downturn because of the pandemic.

As a result of the vote, about $1.5 million will be returned to defunded parks improvement projects; $913,000 is going back to the city’s sidewalks program; and $1.16 million will go to the city’s Capital Improvement Program facilities reserve.

Additionally, $406,000 will be returned to the city’s fire apparatus replacement reserve; $150,000 will go to the equipment replacement reserve; and $186,000 will be going back to the city’s parking security fund.

“The City is relieved to be able to direct these dollars back into Napa’s community sidewalks, public facilities, and our fire apparatus replacement funds — all of which saw drastic funding cuts in the original budget,” city manager Steve Potter wrote in an open letter. "Additionally, we refunded needed playground equipment retrofits, park infrastructure replacements, and parking lot repairs so residents can safely and comfortably enjoy the outdoors at our parks.”

The council also allocated $150,000 into hiring incentives and recruitment, which has remained a challenge for the city — and employers throughout the country — during an economic rebound this year. And the passing motion included that $1 million be placed into the city’s Section 115 trust, which was created to help mitigate increases in future pension costs and didn’t receive a contribution in FY 2020-21.

City revenues did take a substantial hit during the past financial year, Potter said, and the surplus is the result of the city budgeting around a projected $20 million drop in revenues.

Allocation

The city of Napa is reallocating revenues gained this past fiscal year largely into areas that were cut in preparation for a pandemic-induced economic downturn. 

“I think it’s important to remember, and keep in mind, that we did not experience an increase in general fund operating revenue this year,” Potter said. “Our current financial situation is a result of the actions we took.”

A General Fund budget approved in June 2019 expected the city would receive $104.75 million in revenue and would spend $103.3 million in the 2020-21 fiscal year.

The city ultimately generated about $88.3 million in revenue — and added on about $6 million in one-time revenue by defunding various city projects — and spent roughly $88.6 million during the past fiscal year, said city budget officer Jessie Gooch. The city managed to spend only $88.6 million by making cuts and freezing staff vacancies.

That revenue amount doesn’t include the $7.4 million the city received from the federal American Rescue Plan in May because guidance on how the funds should be used is still evolving, said finance manager Elizabeth Cabell. (The city will receive a second $7.4 million allotment of American Rescue Act funds during the current fiscal year, according to past Register reporting.)

“When that money was first made available and sent, it was sent as, ‘here’s money, spend it, spend it on whatever you need to spend it on,’” Potter said at the meeting. “We have since found out there are restrictions and limitation to that money. The last thing we want to do is have to pay back $14 million because we made unauthorized expenditures, so we’re trying to be very careful.”

Though the city’s property tax revenues continued to steadily grow, revenue generated from business license tax, sales tax, and hotel-room tax, as well as revenue generated by city services, all declined during the pandemic, Gooch said.

The greatest drop in FY 2020-21 was in the hotel-room tax — known as the transient occupancy tax, or TOT — which generated just under $12 million in revenue compared to $23 million in fiscal year 2018-19, Gooch added. But revenues from that tax were on the rebound when the fiscal year closed at the end of June, she said.

The Napa council members said they were glad to see the city’s budgeting process pay off.

“We’re not out of the woods yet, but the work here and the sacrifice by everybody really shows that we put ourselves in a better position than where we thought we’d be in,” said council member Bernie Narvaez.

Council member Liz Alessio said she’s fine with the hiring incentive allotment for now, but she’s concerned it won’t be enough for the city to be competitive in hiring for some positions, such as police officers — who are generally receiving about $15,000 in hiring bonuses, she said.

Council member Mary Luros said the hiring allotment is initial funding and the City Council will be able to fund the hiring incentives more, if needed, down the road.

Several council members also said they’re looking forward to finding out what the American Rescue Act funds can be used for.

“We’ve been pretty conservative in how we approached our finances during COVID, and I’m so grateful that we’re able to bring back some of these projects that were really very hard to cut,” Luros said. “I think we’re still stretched a bit thin and the future is still unknown — we don’t know how long this is going to continue — but I appreciate staff’s balanced approach to spreading out these funds and bringing back some of those really difficult cuts.”

On a bone dry, windswept northern California coastal grassland, a Tule Elk bull stakes out his turf, bugling for a female. It's the height of mating season.For 40 years the species has thrived on protected federal land the Point Reyes National Seashore but now part of their herd is disappearing.  "So it's a drought-stricken reserve that they've trapped half of the animals in there, about 600 elk in the park, about 300 inside the so-called Tule Elk Reserve. And there's not enough food or water in the reserve," said Jack Gescheidt with Tree Spirit Project.They're dying of thirst. The West is caught in a megadrought. There's not enough rain or snow melt to feed the aquifer and fill the elk's watering holes, nor make pastures verdant. "Well, the thing about the tule elk is they're what we call keystone species they evolve with the native landscape and so they are instrumental in the main maintenance and also the restoration of the native landscape," biologist Julie Phillips said. Even these resilient elk, whose adaptations allow their bodies to wring moisture from the driest vegetation, are in decline. "The numbers we've been throwing around is 406 elk have died by the park service's own count in the last decade 152 of those elk just last year," Gescheidt said.Gescheidt, a local photographer and animal rights activist, has called attention to the plight of the elk. Dozens gathered at the Seashore's park to rally in defense of the elk in September.  Extreme summer temperatures and extreme changes lead Gescheidt to do something extreme himself. He organized dozens to hand-carry water to the dehydrated elk. "There are too many hot days; the soil gets baked like that, and all these problems are the reservoirs," he said. "I've never seen them so low. I've lived around here for 20 years. I've never seen reservoir so low, and the ponds in the park that the elk drink from completely dried up."The elk are fenced in on the Tomales Point section, so they can't access other water sources. The division exists because dairy farmers and ranchers operate and have grazing rights on the other side, which are leased out by the National Park Service. The activists want a fence that divides the Point Reyes National Seashore gone. On one side there are dairy operations with ample access to water. On the other, the elk are cut off from water and are dying of thirst."The elk shouldn't be that way," Gescheidt said. "They shouldn't be starved. They should be free to walk over to where there is just 100 acres away, plenty of food and water, adequate food and water."Gescheidt is a plaintiff in a lawsuit to remove the fence and change the park's management plan.The lead attorney says the elk's supporters want the entire preserve management plan changed to help wildlife first, not just agricultural business.  "The park service has known that the tule elk, who live at Tomales Point, have been dying horrific and preventable deaths for years," said Kate Barnekow with Harvard Animal Law & Policy Program. "Our plaintiffs have told them, the public at large has told them and they have failed to take any action."The National Park Service declined to speak on camera because of the ongoing litigation but says it's installed water tanks to help the herd. "But we, humanity, are heating the water that we're in, raising it to a boil, and we don't know how to get out or we don't want to get out," Gescheidt said. Activists say the fence is still in the way and that the drought and die-offs should also raise another question: Rancher access to land reserved for the wild. 

You can reach Edward Booth at (707) 256-2213.

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