In the penultimate step in the city’s budget adoption process for fiscal year 2013-14, the Davis City Council will hear presentations Tuesday from each department on their respective plans for the next 12 months and how much those operations will cost.

Council members then will have the opportunity to offer input on what they would or would not like to see funded in this coming year’s budget.

The council is not expected to adopt the final budget until June 25.

Tuesday’s meeting will begin at 6:30 p.m. in the Community Chambers at City Hall, 23 Russell Blvd. It can be seen on Comcast Channel 16 and AT&T U-Verse Channel 99. It also can be streamed on the city’s website at www.cityofdavis.org/media.

No matter what each city department presents Tuesday, it will have to be a plan that’s 5 to 8 percent less costly than what they operated with this fiscal year.

In his report to the council, City Manager Steve Pinkerton explains that to continue to rein in spending, he has asked public safety departments to develop general fund reduction scenarios of 5 percent and all other departments a reduction of 8 percent.

While these reductions will not translate into any layoffs, nine vacant positions will be eliminated and other employees will have hours reduced, positions reclassified or transferred to other departments.

Meanwhile, because the city has spent $1.8 million on overtime for police and fire personnel, there will be less money left over in the 15 percent reserve fund that the city traditionally keeps.

“I have asked departments to rein in spending for the remainder of fiscal year 2012-13 (through June 30) in order to conserve money,” Pinkerton said in his budget introduction. “The forecast change has a minimal impact on the fiscal year 2013-14 budget because carryover was not anticipated to be used to balance the budget.”

For 2013-14, the city manager proposes to spend about $41.7 million in the general fund and $245.5 million of $254 million available for all funds.

The $245 million in expenses is an increase of about $100 million over last year to pay for three major capital improvement projects that will begin to take shape over the next year, including the $113 million Woodland-Davis Clean Water Agency surface water project, the city’s $95 million project to upgrade its wastewater treatment plant and the street and bike path pavement repairs it must make over the coming years.

“In short, there is a lot going on,” Pinkerton said.

Another huge expense that the city must contend with in the coming years is its water costs, which fall into the realm of the Public Works Department. That department will receive the second most funding this year at $47 million.

With the surface water project on the way and water utility rates sure to climb so that the city can pay for its share, Davis must find ways to reduce consumption to curb potentially unsustainable water bills.

If the city makes no attempt to conserve over the next five years, it could be paying up to $3 million for water.

Pinkerton has said the city will be looking at various ways to reduce its water use, including converting greenbelts into non-grasslands and removing unused sprinkler heads.

Meanwhile, the general fund continues to be dominated by employee compensation.

As the city announced last week, despite reaching deals for new contracts with about two-thirds of its employees, all of which make considerable reductions in employee benefits, a large piece of that labor contract puzzle has yet to fall in place. That is forcing the city to budget more for next year in employee compensation.

Should the city not reach deals with its two largest unions, the Davis City Employees Association and the Davis Firefighters Association Local 3494, in the next four months, Pinkerton predicts it will cost the city about $456,000, with a little more than half being drawn from the general fund.

In addition to reining in spending in all departments, Pinkerton is putting new emphasis on identifying a new, stable source of revenue for the general fund. He has talked recently about increasing the city’s various parcel taxes, which include the parks maintenance tax and sales tax, both of which can be changed only through a vote of the public.

The city manager also points to the hiring of Rob White, the city’s new chief innovation officer, as someone who will play a key role in generating revenue over the coming years through his efforts in economic development.

“Expenses are rising faster than revenues,” Pinkerton says. “Reductions and cost-avoidance measures continue to be used to control the city’s climbing costs but is not the sole solution.”

— Reach Tom Sakash at [email protected] or 530-747-8057. Follow him on Twitter at @TomSakash

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