Around Town | June 4, 2010 | Palo Alto Weekly | Palo Alto Online |

Palo Alto Weekly

News - June 4, 2010

Around Town

MAJOR WASTE ... Not all budgets deficits are created equal. Some, like Palo Alto's projected $7.3 million budget gap, creep up slowly and give city officials plenty of time to brace themselves for the cuts ahead. Then there's the $6 million shortfall in the city's Refuse Fund, which cascaded on the City Council faster than a trash bag rolling down a garbage chute. The council's Finance Committee was surprised to learn on May 27 that the Refuse Fund (which is not part of the city's General Fund) is projected to lose $6 million by the end of fiscal year 2011. As a result, residents may find their garbage rates rising starting in July. The City Council will consider the size of the increase on June 14. Public Works Director Glenn Roberts attributed the budget gap largely to a drop in refuse revenues, which he estimated at a jaw-dropping $7.2 million. This includes a $6 million drop in industrial- and commercial-waste revenues. As things stand, the Refuse Fund is on course to end fiscal year 2011 with a mere $400,000 in the bank — far short of the $6.1 million that is needed to pay off the state-mandated "landfill closure liability." The committee was not at all pleased with the news. "It's just surprising to me that I'm learning about this now, at the end of the entire (budget review) process," Vice Mayor Sid Espinosa said. "There's no way, with a $6 million shortfall, that people did not realize this a month ago, as we were starting this process." Councilman Larry Klein agreed and called this surprise "just not good form." He also suggested that the city carefully consider expense reductions in the Refuse Fund, rather than simply look at increasing revenues through rate increases. "We've been telling people — and I think the administration has been saying — that we won't be having to increase utilities this year," Klein said. "Obviously, we are now."

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