Watsonville Civic Plaza. (Nick Sestanovich — Santa Cruz Sentinel file)
WATSONVILLE — Following a lengthy presentation and discussion, the Watsonville City Council unanimously approved a series of financial documents and asks at its Tuesday meeting.
These included the Annual Comprehensive Financial Report for the 2022-23 fiscal year, the Mid-Year Financial Report for the 2023-24 fiscal year, the annual Measure Y Audit Report for the 2022-23 fiscal year and a resolution amending the 2023-24 budget to authorize $3.7 million in budget appropriation for various funds and to authorize four additional positions.
Both Watsonville’s City Charter and California law require local governments to publish a complete set of financial statements that conform with the United States Generally Accepted Accounting Principles. From there, the city prepared its Annual Comprehensive Financial Report, audited by Pleasant Hill accounting firm Maze and Associates.
Among the highlights of the report noted by Finance Director Marissa Duran, the city experienced a $3.5 million in the General Fund balance over the previous year.
“The reason for this increase is we did materialize a 1.1 (percent) over budget on sales tax,” she said. “We also sold the Porter Building for $1.1 million. We appropriated those funds when they were dispensed in that fiscal year. We’re currently spending those funds down now.”
Duran also said the city had an additional $600,000 in investments that were not initially budgeted for but materialized at the end of the cycle.
The fund balance includes $1 million in the CalPERS reserve, $1.2 million in new capital for the remodel of Ramsay Park and 10% of the General Fund in the emergency and cash flow reserves.
“What this means is we’re fully funded in our reserves,” said Duran.
Last year also marked the first year of funding for Measure R, a half-cent sales tax measure approved by Watsonville voters in 2022 to fund community projects such as park repairs, playground repairs, trail maintenance, after-school programs, street maintenance, pothole repairs and more.
Duran said the city received approximately $350,000 in Measure R funds, and there was enough money available in the fund balance so the city would not have to tap into the reserves.
“We won’t have to go into our reserves for any of our asks,” she said.
In other highlights, the property tax is expected to be just slightly overbudget, the utility and sales taxes are projected to be on budget, car sales are outpacing the state average and keeping Watsonville within budget projections, and the hotel tax is projected to be on budget. Currently six hotels are participating in the hotel tax: the Motel 6 on Silver Leaf Drive, Holiday Inn Express on Main Street, Best Western on Freedom Boulevard, Comfort Inn on Airport Boulevard, Valley Inn on Main Street and the newly opened Hampton Inn on Lee Road.
Duran said two hotels, Royal Inn on Freedom Boulevard and Rodeway Inn on West Beach Street, were taken offline as they did not qualify for the transit occupancy tax, but the addition of Hampton Inn offset those losses.
In terms of Measure R projects, Duran said street repair projects at Green Valley Road and Bridge Street were in the design phase and expected to go out to bid later in the year, $1.8 million has been allocated toward repairing Ohlone Parkway which will begin work later in the year, an outdoor cafeteria on the second floor of the Watsonville Public Library is in the design stages, and staff are working with a financial adviser on major projects such as City Plaza, the new nature center at Ramsay Park and the Rolling Hills agreement.
Among the staffing requests were a new development facilitator or ombudsperson in the city manager’s office and the swapping of a police officer position with a police services specialist. Police Chief Jorge Zamora said the department already has a part-time specialist position who traditionally responds to non-emergency calls, assists with directing traffic, issues citations and are provided with very limited suspect information. The new full-time position would have them also respond to non-injury traffic collisions.
“(It) will help alleviate the workload that the officers have to take on because not only are they responding to the crimes that are in progress, but they also have to respond to the crimes that are not in progress,” he said. “This will give us a little bit more flexibility in the schedule and the response times to those types of calls.”
Councilwoman Ari Parker asked how many vacancies the department had. Zamora said there were nine vacancies, four cadets going through the police academy and three employees retiring. Parker asked where the funding for the specialist position would come from, and Zamora said it would come from one of the vacant officer positions.
The swapping of the officer and police services specialist positions would draw in $170,000 for overtime costs. Parker asked why this figure was chosen. Zamora said a lot of younger staff are opting to take time off to spend time with their families as well as vacancies stemming from departures that need to be filled.
“All of that stuff contributes to such a high rate of overtime expenditures, but then also we have the unpredictability of crimes, specifically violent crime,” he said. “If there’s a violent incident in town, we’re calling not just one detective because we have one detective on call. Everyone’s coming out, so now you have overtime costs for that investigation, not just for the callout but for things that happen throughout the investigation.”
The council voted 7-0 to approve the reports and budget requests. Budget proposals will be prepared for City Manager Rene Mendez by March 31, with projections made at the end of the third quarter in April or May. A proposed budget for the 2024-25 fiscal year is slated to go before the council June 11.
Elsewhere in the meeting, members of the public expressed disappointment that the council had not called for a special meeting to vote on a Gaza ceasefire resolution as had been hinted at its Jan. 16 meeting. Mayor Vanessa Quiroz-Carter clarified that she did all she could to call for such a meeting but did not feel she had the support of her council colleagues.
“I think it’s important to discuss that item,” she said. “Even if you don’t agree with it, I think it’s important that we have healthy, robust discussion that is a cornerstone of our democracy, and I tried everything that I could possibly do to make that conversation happen. I don’t know what to say. I’m just as upset and embarrassed as you all are.”
