Because of the coronavirus crisis, Fontana officials had been concerned about the city's financial situation and whether cutbacks would be necessary this year.
But as it turned out, the city is faring well and will not have to lay off any full-time employees, City Manager Mark Denny said in his proposed operating budget document for fiscal years 2021-2022 and 2022-2023.
The budget was approved by a 5-0 vote of the City Council during the June 8 meeting.
"Although we are only halfway through the year, 2021 is definitely looking better than 2020," when the pandemic began, Denny said in the budget report.
General Fund revenues for 2021-2022 are $119.8 million, an increase from $110 million in 2020-2021, Denny said.
The major reason for the rise in revenues was the city's sales tax money, which totaled $47.1 million this year (39.3 percent of revenue), up from $39 million last year.
Meanwhile, General Fund expenditures went up to $110 million in 2021-2022, from the previous $105.8 million. Last year, the city had to cut millions of dollars from its budget.
By far the biggest expense in the budget is the Police Department, which is getting $67.2 million (61.2 percent of the General Fund total). Last year, the Police Department received $65 million (61.7 percent).
The category with the second-highest expense is the Community Services Department, which gets $13 million (11.9 percent of the General Fund), an improvement from the $11.9 million of last year.
The Public Works Department is receiving $7.4 million from the General Fund (6.8 percent).
Denny decided to prepare a two-year budget, which is a completely new process for the city, "one that we hope will not only save time but also provide enhanced fiscal transparency, increased accountability, and greater stability," he said.
Denny said that in putting together the budget, city staff followed three key principles that were established to guide its development in the midst of the COVID-19 pandemic:
• Preserve and protect the city's full-time staff. "Having staff ready and available to assist in the economic recovery ahead will be a key element to the city's success going forward," Denny said.
• Reduce discretionary services, supplies and project spending. "Doing so reflects the reality of many things not occurring such as recreation programs, and limits spending on non-critical one-time projects to compensate for a one-time negative impact to revenue," he said.
• Manage the budget on a quarter-by-quarter basis. "The city will need to be agile as it navigates economic recovery and prepares for any other unforeseen issues," he said.
Denny said expenditures continue to be held at a lower level as a result of the continuing uncertainty facing the economy, although the city will be glad to reopen facilities and restart programs based on Gov. Gavin Newsom's plan to fully open the state on June 15, if the necessary health protocols continue to be met. The number of new coronavirus cases has drastically declined in Fontana and in the state as a whole during the past five months.
Fontana's 2021-22 budget provides for three quarters of facility use and programs, while the 2022-23 budget provides for a full year.
"Most budgetary increases are due to these facility reopening, programs restarting, and contractual obligations related to full-time staff," Denny said. "We will continue to manage the budget on a quarterly basis until we reach full recovery."