Ojai Valley News Blog

City learns of $850,000 in federal stimulus money, while state hits Redevelopment Agency for $592,000

By Daryl Kelley
The feds give, and the state takes away.

That’s the reality of Ojai’s turbulent budget picture this year.

The city expects to receive at least $850,000 in federal stimulus money for road paving and two new trolleys in the next few months, and may pick up $110,000 a year for three years from Washington for a school resource officer at Nordhoff High School.

At the same time, however, the city’s new budget for the fiscal year that began July 1 took a $180,000 hit when California lawmakers approved a budget balanced partly on the backs of local government. The state promised to pay the money back in three years with interest.

But that loss left Ojai, a city with hefty budget surpluses the last several years, with a precarious surplus this fiscal year of just $3,000 out of a general fund budget of nearly $8 million.

“We built a budget to have a surplus of $183,000,” said city manager Jere Kersnar. “Now it’s $3,000. That’s essentially a balanced budget without a surplus.”

On top of that, the state’s budget counts on snatching $592,000 in cash from Ojai Redevelopment Agency reserves built up over decades. And that money won’t be repaid, said  Kersnar on Monday.

“That’s half of what we have in the Redevelopment Agency account,” he said. “And that money comes from housing, which the state tells us to build more of … The state orders on one hand, and on the other, it taketh away.”

Kersnar said he expects California cities and their collective Redevelopment Agency Association to challenge the pilfering of redevelopment money in court, which they did successfully last fall, when the state siphoned some cash out of local accounts.

“The trial court in Sacramento County ruled that the (taking) was unconstitutional,” Kersnar said. “But what the state has now done is use the judge’s wording to draft a law it says is constitutional. I expect the cities to challenge that in court too.”

Although the state passed a nearly balanced budget two weeks ago, its impact is still being sorted out, Kersnar said. So the numbers he is reporting to the City Council could change a bit.

“We’ll have to come back to the council and ask them what they want to do once we get this all worked out,” he said.

The council’s goal has been to maintain a $500,000 surplus each year, so it can build its emergency reserves, now about $3 million, to $4 million. But there is no chance of tucking away much in these difficult times, Kersnar said.

On the positive side, the City Council approved a plan last week to spend $400,000 from the federal transportation stimulus package on the paving of major city streets.

The city approved a time line that calls for completion of rubberized asphalt paving on seven local streets by Thanksgiving, which would meet federal requirements that the money be spent within six months. Caltrans notified the city recently that the $400,000 was available.

“All of the money must be used on collector (roads) and arterials,” said Mike Culver, Public Works director.

Under the plan, the money would be used to augment paving projects already planned for several of Ojai’s busier streets. Specifically, it will be used to pave: Del Norte from near Ojai Avenue to the city limits, 1,000 feet for $32,553; Bristol from Ojai Avenue to Foothill, 1,200 feet for $46,887; Valle Rio from Descanso to Carillo, 1,600 feet for $77,087; Park from Ojai Avenue to Grand, 2,050 feet for $98,767; Grand from Gridley to the city limits, 1,050 feet for $34,181; Foothill from El Paseo to Matilija, 300 feet for $14,063; and Foothill from Aliso to El Toro, 1,100 feet for $42,971.

It is possible that two other portions of streets might also benefit, Foothill Road from Foothill Lane to Fairview Road and Daly Road from Grand Avenue to Montgomery Street, Culver said. But there’s probably not enough federal money to reach those second-tier priorities, he said.

Ojai is also in line to receive about $450,000 to replace its two aging trolley cars, Kersnar said. Those trolleys are between seven and 10 years old and rapidly approaching their recommended life span, he said.

Federal transportation money pinpointed for small cities that are a blend of rural and urban, such as Ojai, qualify for such money, Kersnar said.

“That’s roughly $450,000, but it’s still under review, and we thought we’d know by now,” Kersnar said.

A third pot of stimulus money is for law enforcement, and Ojai will hear by September whether its application for $110,000 a year for a school resource officer at Nordhoff has been approved. That grant would run for three years, and the city, School District and Sheriff’s Department would pick up any additional costs beyond the $110,000 annually, Kersnar said.

Another possibility is that the city would get a small grant to audit city and other public facilities for energy efficiency. The city is working with Southern California Edison and a nonprofit energy broker to get a piece of that action, Kersnar said.