The road to catching up on the city’s street and bike path repairs begins Tuesday, when the Davis City Council will consider a $144 million budget with a built-in plan to allocate about $2 million to maintain the city’s deteriorating infrastructure.

The meeting will begin at 6:30 p.m. in the Community Chambers of City Hall, 23 Russell Blvd.

City Manager Steve Pinkerton has recommended a spending authority of $144,705,550, which includes $106,483,669 for the fiscal year 2012-13 operating budget, $27,433,891 for capital improvement, $8,615,203 for debt service and $2,172,787 in redevelopment successor agency funding.

In addition to the plan to focus on streets and bike paths — a program that would receive more than $3 million if the council OKs the budget — Pinkerton also has plans to catch up on other unfunded liabilities that the city must tackle in the coming years: namely, retiree medical benefits (OPEB) and employee pensions (CalPERS).

Pinkerton projects the cost of paying for OPEB to rise from 12 percent to 20 percent of payroll, or a $1.7 million increase.

As for pensions, the city plans to start siphoning additional money into a “rainy day” fund — $678,000 for 2012-13 — in case CalPERS, the entity that manages public worker pensions, reduces its return on investment projections and changes its mind on the level of cities’ contributions.

The budget also includes measures to “reduce the General Fund structural deficit to $940,000 and draws (the) fund balance down to 9.5 percent, which is below the suggested fund balance reserve of 15  percent.”

In addition to asking for concessions from the city’s eight employee groups — all of which have contracts that expire this month — Pinkerton plans to achieve these budgetary goals through the reorganization and restructuring of City Hall’s services, something he says has been going on for the past year.

“We’ve been holding positions vacant, eliminating positions, reallocating positions throughout the year,” Pinkerton said Friday.

The preliminary budget proposal the city manager presented at the last City Council meeting listed $3 million in savings through reorganization and restructuring and $4 million through the contract proposals the city has on the table with its employee groups.

Pinkerton also wanted to stress that the reduction of 29 positions listed in the preliminary budget proposal was not an indication that the city plans on laying off 29 employees.

“The budget proposed has very few elimination of positions contemplated in it. Most of the changes have been happening in the 11-12 fiscal year,” Pinkerton explained.

The city has seen a 15.5 percent overall staff reduction over the past four years.

According to Pinkerton’s staff report, this is the fifth consecutive year that the city has asked for budget reductions in June “in order to maintain the City’s General Fund operating budget.”

The report also notes that cutbacks “address further reductions in funding levels from state and federal sources supporting transportation and social services programs.”

The council must adopt a 2012-13 budget before the new fiscal year starts on Sunday, July 1. It can make adjustments later in the year.

Water project ballot measure language

The City Council has two big surface water project decisions to make Tuesday as well.

First, the council will have to make its final decision on what type of measure it wants to place on the November ballot for a vote on the surface water project. It has the choice between a binding measure that would tie the city to the outcome of the vote, or an advisory measure that would not bind the city to the final tally.

The Water Advisory Committee recommended at its last meeting that the city place a binding measure on the ballot in order to show confidence in its decision.

Also Tuesday, the City Council must decide exactly what language to put on the ballot.

The WAC recommended including all of the details of the surface water project and the rate structure, which it plans to approve in late August and September, in the Proposition 218 notice that will be sent out Sept. 18 and then refer voters to that notice to learn about the issue on which they are making a decision.

Last month, the water committee told the council that it needed more time to decide on a project and rate structure, making it impossible for the council to put all of the necessary information on the November ballot.

The Yolo County Elections Office requires ballot language by Aug. 10 and the committee won’t be ready with its recommendations until September.

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

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