Napa City Council approves using budget surplus on various projects

“We are very happy with the position we’re in financially,” said city manager Steve Potter at the meeting. “We have a lot of catching up to do from the couple of COVID years that we were heavily impacted financially in, but we have recovered quicker than we had expected.”

The council voted 4-1 to move forward with the allocations, with Councilmember Mary Luros dissenting. 

Anne Cardwell, the city’s finance officer, said at the meeting that while city fiscal policy states that the entire surplus should be transferred to the Capital Improvement Program Facilities Reserve, staff recommended that $5.3 million go toward addressing current city needs, with the remaining $7.2 million heading into the facilities reserve. The council unanimously approved these allocations.

That included adding $1.5 million to the Highway 29 undercrossing project, which will eventually build a bicycle and pedestrian path to run beneath the four-lane freeway. Cardwell said Caltrans estimates for the project are higher than anticipated, so the city needs to assign the additional funding for the project to continue.  

The approved allocation also included adding $1 million to the city’s fleet replacement reserve and another $1 million to the fire apparatus replacement reserve. And it included $500,000 to replace the city’s land management software.

Another $500,000 was assigned to one-time costs tied to a memorandum of understanding the city approved with the Napa City Employees’ Association, which included payments to workers who are not part of the adopted budget. A further $150,000 was set aside for hiring incentives and recruitment.

In addition, the council approved a $500,000 “contingency budget,” which would be used on unexpected, non-capital costs that arise this year that are related to the city’s priorities.

At the meeting, Luros suggested the contingency budget funding could instead be used to fund a project to permanently close the Main Street block to vehicles between Second and Third streets. (No closure plan has yet been presented to the council.) But the other councilmembers disagreed with making that move, at least immediately.

City budget officer Jessie Gooch noted that the numbers are still unaudited; June 30 is technically the end of the city’s fiscal year, she said, but the city’s finance department needs to work out the specific details over the following few months. The final reports on the 2021-22 budget are therefore scheduled to be finalized in December, then presented to the council early next year.