Following a lengthy hearing with little fanfare, Chico’s City Council narrowly approved an $87 million operating budget for the upcoming fiscal year.
The amount is about the same as last year’s figure.
The total budget, which includes spending on big, so-called capital projects — typically large infrastructure paid for in part by state and or federal funds — slipped $13 million to just under $110 million.
City Manager Mark Orme, who faced nearly $8 million of red ink a year ago, again proposed no significant increase in spending. Major cost cutting, layoffs and givebacks from city employees have enabled the city to speed debt repayment.
Orme said the city is on track to pay off its debt in four years, but could possibly reach the goal in half that time.
“Our foundation was cracked — it was broken,” Orme said. “It almost failed to the ultimate degree. What we’re doing now is on all fronts were recreating this foundation.”
Challenges remain. Even with a healthy amount of fiscal restraint, Chico, like many other municipalities, faces growing financial challenges. The cost of medical insurance, worker’s comp and pension contribution rates with CalPers are all climbing. The city also recently granted a 5 percent raise to police officers. The police department now accounts for 27 percent of the budget, according to Frank Fields, director of Administrative Services.
The budget was approved by a 4 to 3 margin on the strength of the council’s conservative majority.