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Hercules Council Declares State of Fiscal Emergency for Second Time

The declaration will allow a tax increase ballot measure to pass with fewer votes.

In an effort to ease a path to increasing taxes this summer, the Hercules City Council unanimously declared a state of fiscal emergency in the city Tuesday night.

"We're either going to increase our income by imposing a new tax that no one's going to be happy with, I'm sure, or we're going to take some very drastic steps like [dissolving the Hercules Police Department]," Council Member Bill Kelly said. "My wife's not happy with me for supporting this, but I don't know that I have any choice."

This is the second consecutive year the council has declared a state of fiscal emergency, and the declaration will allow a tax increase measure on the ballot to pass with a vote of 50-percent-plus-one-vote instead of the usual two-thirds margin. The council is considering asking voters in a June election to increase the city's utility users tax by 2 percent and include cable in the utilities that are taxed, but has not formally placed that measure on a ballot.

The city faces a $1.2 million deficit for the next fiscal year, about the same amount plugged by a one-time fund transfer this year.

Dale Robbins, Secretary-Treasure and Principal Officer of the Teamsters 315 union that represents many city employees, outlined some of the concessions they have already given to help the city's finances.

"There's really nothing else the employees would be willing to give back to help you balance the budget," Robbins told the council. "They've done their share and remember, they've had the hopes that you would find the money to solve some of these financial problems, and are sorry to see you're in the same position with this deficit."

The city has already laid off a third of its police force and numerous other city employees, and imposes furloughs and requires employees to pay more toward their benefits.

Vice Mayor Myrna de Vera said she was hesitant to vote in favor of the declaration, saying she wanted to hear more about the city's options if a tax measure fails.

"I'm not sure we can be declaring fiscal emergencies every year," de Vera said.

After the declaration was passed, the council voted to hire the Lew Edwards Group to provide polling and communication services for the possible tax measure; that firm's services to the city could cost up to $65,000.

The council also voted 4-1, with Kelly opposed, to raise solid waste rates in the city. The move will also increase the "franchise fee" paid to the city, resulting in an increase in revenue. Click here for more on that topic.

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Jerrold "Jerry" Parsons February 15, 2013 at 02:27 PM
How is the other cities benefiting from this service. It appears to be working in other cities and should be discussed as an option. Maybe a last resort, but at least a conversation.
Sarah Creeley February 15, 2013 at 02:39 PM
About 15 years ago I compared the pay of YMCA workers to the pay of the Hercules Daycare workers, and YMCA paid much more. I'd be surprised if that has changed. I was making the argument that our daycare workers were underpaid. The Daycare Centers just gave a notice of higher fees and I know these additional costs are hard on many families, The reason why the city voted to stay with our own Park and Recreation programs was because they met their goal to be cost nuetral. Since costs are going up, the Daycare Centers must raise their fees. The Hanna Ranch Daycare has people working there who have been there for many years. There is low turnover and whenever I see the kids they are always being actively engaged, The decision to stay with these great people had everything to do with money, and nothing to do with unions. Please do your homework; compare the wages before making presumptive statements. As far as Measure O goes, I voted for it because of the message that it would help our Police Department. I agree that it is ridiculous for the Council to vote fiscal emergency, propose more cuts to our Hercules Police Department, and use then $62,000 dollars to spend on efforts to pass a new tax.
Sarah Creeley February 15, 2013 at 02:39 PM
In regard to the Sheriff's Dept. versus the Hercules P.D. I am strongly in favor of keeping HPD. I grew up in Bolinas with Sheriffs, and I rarely saw them. I go through El Sobrante a lot and again, I hardly ever see them. The Hercules Police Department has a great Police Chief, Bill Goswick! The HPD's detective work has solved many crimes. Our community needs the HPD! What we don't need is to be using money foolishly.
Giorgio C. February 15, 2013 at 03:44 PM
Sarah, Did you factor in the cost of the city being on the hook for pension benefits for these childcare employees? The YMCA probably offers a 401(k) plan, yes? If these are all city positions, then they are costly in the long term. Some types of jobs are best contracted out. Perhaps each supervisor position could be a city employee. Also, doesn't Hanna Ranch have an additional supervisor position not found at the other two elementary school childcare programs? We need to review what all 3 elementary schools are receiving in terms of services right now, not just Hanna Ranch. Regarding doing my homework, I did. I've discovered every time the city says Parks and Rec is budget neutral, we learn otherwise, that we keep having to bail them out. Did they ever begin charging for use of picnic tables at Refugio?
Patty O'Day February 15, 2013 at 04:37 PM
I am new to Hercules, so please pardon my ignorance, but I was wondering if there has been any fundraising efforts for the Parks & Recs Department? Since they already have the facilities, maybe a pancake breakfast, or a BBQ, or a Spaghetti Dinner might help out. Even raising $2,000-$3,000 per event would help, I think. Volunteers could help make this happen. Also, contacting foundations for grants might help. Local businesses could donate goods or services for a raffle or auction. My friend has a child that used to go to Hanna Ranch Childcare. It was very helpful to my friend. I hope that service can remain.
Bud Burlison February 15, 2013 at 04:57 PM
Regarding Giorgio C's comments on the CCSO's level of service,; I find it amusing that a resident of Hercules could comment negatively on another agency's services. Probably just taking a time-out from the myriad problems suffocating their fair City.
Phil Simmons February 15, 2013 at 05:18 PM
Sarah, I'm not sure but I am guessing that it was my comment regarding unions that you refer to. Can you confirm for me if there are any union positions at City Hall that deal with the city owned daycare effort (drivers, childcare workers, Park & Rec staffers, etc). I will admit I do not know for certain. But I recall conversations back in the spring of 2011 that dealt with the YMCA question and one of the problems that came up was that the wages and benefits the YMCA offered was not as good as the the ones the City offered, in which case switching to the YMCA would cause financial hardship on various city employees. That may not in fact be true but it was discussed in blogs at the time. I do not recall seeing a "real" presentation on the income and benefits of the City verses the YMCA. The idea of selling the day care services, along with some other City services, was dropped before being studied. This is why I say that bringing the YMCA to Hercules is a non-starter. There seems to be enough public willpower to stop it from being discussed much less from actually happening.
Phil Simmons February 15, 2013 at 05:23 PM
Bud, I had considered moving to one of the following towns, San Ramon, Orinda, Lafayette, or Danville. But now that I understand how crime ridden they all are I have changed my mind.
Giorgio C. February 15, 2013 at 05:30 PM
Bud, Your logic is flawed. Have you read about the CC County employees who are suing for their right to spike pensions using accrued vacation time? Have you read about the Grand Jury report on the CC Sheriff's retirement plan? What is so amusing about this?
Bud Burlison February 15, 2013 at 06:12 PM
Georgio. Sorry you took my post for some sort of logic. You must be a pretty busy guy to be the all-encompassing concerned citizen for the County's service levels. What's your opinion on the CA State issues? Phil. That's funny.
Giorgio C. February 15, 2013 at 07:02 PM
Bud, Your comment implied a hercules resident has lost their right to provide an assessment of county services. I will assess all levels of government who are reaching into my wallet. State issues? For starters, State Ed. Superintendent Torlakson better get some real oversight in place or he can forget being reelected.
Bud Burlison February 15, 2013 at 08:04 PM
Giorgio: please. Don't make false implications. I just said you're a real busy guy. A little knowledge is a dangerous thing.
Giorgio C. February 15, 2013 at 08:28 PM
Bud, I misunderstood your original comment. I agree that there is some humor to be found. I don't want to get into trading insults with you over a misunderstanding. Enjoy your day.
Ani February 15, 2013 at 08:47 PM
Last night, I was polled regarding a new UUT increase, etc, obviously for our city. The young woman was very polite, albeit VERY tired as there were several yawns and many mispronunciation of words. Is this what the city is paying for by hiring Lew Edwards? Sure it was late where she was Pennsylvania, Philadelphia, sorry can't remember 11:30pm for her. Were my responses accurately recorded? Will it make a difference. Is the city/city council going to go ahead anyway if not in June in Nov with the increases. Will the citizens actually be heard?
Ani February 15, 2013 at 08:49 PM
Sorry, meant will the city go ahead with putting the increase measure on the ballot in June/Nov.
Phil Simmons February 15, 2013 at 08:59 PM
Ani, Yes, the city will put the UUT on the ballot regardless of the poll. They may lower the % to hedge their bets, but they will most definitely put it on the ballot. The same was done with Measure O. The consultant, the same consultant recommended against it and it was done anyway. The same will happen this time. and the city will vote to impose the tax on ourselves because the city will sell the vote on "safety issues" as they are already doing.
Patty O'Day February 15, 2013 at 11:33 PM
Could somebody explain this UUT tax to me? I think it is a 2% tax on utilities, and I know it will include cable. But, what other utilities will be covered? PG&E, Water, Sewer? Will the garbage be included in this AGAIN? Or is that rate increase we are getting from the Richmond Sanitory District going to be the only increase for garbage?
Patty O'Day February 15, 2013 at 11:34 PM
Also, this UUT tax will be charged to all residents, not just homeowners, right?
Susan D.Keeffe February 16, 2013 at 12:52 AM
Patty, Right, this will be a tax for everyone living in Hercules who uses utilities, which is everyone.
Phil Simmons February 16, 2013 at 01:22 AM
Patty, Hercules currently has a 6% UUTax. The ballot measure will be to increase the tax from 6% to 8% and add the 8% it to cable (including phone and internet if you are using cable for those utilities. For example if your cable includes tv, phone, and internet, as many Comcast customers have then assuming the bill is about $150/month you will see a UUTax on that bill of $12 per month or $144 per year, just for your cable bill increase. The other utilities will not see as large an increase because you are already paying 6% of the eventual 8%. Keep in mind there are state and federal taxes on utilities as well. Currently the City UTT is on PGE (electric and gas), HMU, EBMUD, cell phones, land line phones, and internet (non cable). This is 6% of your monthly bills for each of the utilities you use. It will soon be 8% of your monthly bills. There are a few cities in Contra Costa County that have UUTax. They are all slightly higher than Hercules. But MOST cities in Contra Costa and MOST cities in California DO NOT have any UUTax's at all. Hercules is one of the States most highly taxed and fee'd cities in the State. The taxes are on residents. If for example you have a cell phone and it is billed to your business, not in the city, it will not necessarily have a UUT depending on the address the bill goes to. In other words though the bills go to both owners and renters. They are only applied to bills going to Hercules addresses. Vote No
Bud Burlison February 16, 2013 at 05:01 AM
I still sit in awe about the ongoing financial situation in the City of Hercules. I enjoy reading about the community interaction in the politics of the City and it's Council on this small blog. I understand that his social venue won't solve any issues with the City of Hercules, but I also am grateful for some of the intelligence that I witness on this site. If you find me somewhat sarcastic in some of my posts, it's just that I witness a considerable amount of political posturing from political gadflys. Political gadflys are important to the process, as addressed to the politicans in their venue. On the Patch, it can seem like bloviation.
Giorgio C. February 16, 2013 at 11:49 PM
Phil, I asked Jeff W. how much of the city's administrative budget is needed to help manage some of the many development projects this city has ubdertaken, but he was unable to provide an answer. This city has gold fever thanks to the RDA, right? You keep comparing Hercules with other cities, but how many of these cities are as financially volatile as Hercules as a result of being plundered and overextended? Is it possible we are paying these higher taxes as a result of the many visions and dreams some have for this city? You said so yourself that there are always the hidden costs with anything. When I look at what Hercules has on its plate, I think we are way overextended. I'm not surprised at the tax situation. Again, we are not like any other city. I'll try to locate some data to support my hypothesis.
Giorgio C. February 16, 2013 at 11:58 PM
Phil, My comment is also in response to your assessnent that our city should only need x number of accountants. Where do you get your numbers as to what is adequate? Are you an authority on such matters? When is the next performance audit? This could provide the most useful information.
Phil Simmons February 17, 2013 at 06:03 AM
Giorgio, My numbers are not my determination of what is adequate. They are merely a starting point for asking how to bring the budget cost in line with the budget revenues. I believe there are savings to be considered not just taxes to raise.
Phil Simmons February 17, 2013 at 06:10 AM
Giorgio, What visions and dreams are you referring to, that that some have for the city? The visions and dreams that I am aware of have not been done or even started. Little has been spent on them. There is a lot that was spent on things that had nothing to do the those vision and dreams and there is much that has been spent on things the city was not prepared to afford. But it is not the vision and dreams that I have heard many speak of. Maybe there is some other group making other things happen that has put us in bad straights. Or maybe it is just a bunch of bad decision making. Either way the effort and results had little to do with what I believe much of the community has been standing up for.
Sarah Creeley February 17, 2013 at 04:08 PM
I just followed my own advice, and did my homework, getting surprised in the process. YMCA pays less! Their Daycare Teachers get $7.67 - $13.19 and Child Care Day Care Workers make $7.49 - $12.24. Hercules Daycare pays a little more, Recreation Leaders make $9.49 - $12.12 hour and Children's Program Leader make $11.96 - $15.27/hour. I think it's sad that the people who are caring for our kids are paid so low, and that the YMCA is paying its workers less than they did 10 years ago. As far as pensions go, I don't know if $ is used for that, but it would be easy to find out. My understanding is that daycare workers are part time employees which means they may not be eligible for benefits. Sorry about MY mistaken presumptions above.
Phil Simmons February 17, 2013 at 05:30 PM
First Hercules had cash cows. Now Hercules has sacred cows. Hopefully some day we may have Happy Cows. http://youtu.be/DZEyGf812_A http://youtu.be/RcGD29NwENI
Giorgio C. February 17, 2013 at 07:03 PM
Sarah, The daycare decision should be data driven. You get what you pay for, yes? It causes me concern that the California licensing board cut back the frequency of childcare facility inspections from biennially to every 5 years. This was a cost-driven decision, not one based on data. Add to the fact that I cannot find a yearly summary report of citations-violations, but instead have to look up the record for each individual center. We can do this for the YMCA and even our current city program, but I also want to see the big picture. Are those centers that are staffed with less trained-qualified employees less safe? If so, this is not a bargain. The bottom line is that the state of California cannot be trusted with the safety of our children, that it is up to us to exercise our due diligence.
Giorgio C. February 18, 2013 at 01:33 AM
Did the Piranhas swim team completely separate from the City? I thought they were going private. Perhaps someone can share how that is working out. I value this program, with the hopes that my daughter will be a Piranha soon.
Giorgio C. February 18, 2013 at 04:08 PM
Piranhas swim team link http://www.ci.hercules.ca.us/index.aspx?page=527

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