Despite several unknowns throwing a bit of a wrench in the works, Santa Clara adopted its two-year budget.

At its most recent meeting on June 9, the Santa Clara City Council unanimously approved the city’s budget, but still has unanswered questions surrounding a few items. Some unique circumstances regarding city revenue and expenses have led to the need for further clarification before the budget can be final, but the council approved the bulk of it.

Among the items unique to this year include money from the city’s $400 million bond measure, revenue from the city’s senior center, expenses at city hall and how much money the city collected for Super Bowl LX.

For the next two years, said Kenn Lee, the city’s Finance Director, the city projects the budget to be $1.97 billion and $2.16 billion, respectively. 

Because of bond dollars, the city will spend $96.6 million in capital improvements, which includes $63.2 million in carryover from the previous year. There was $476.5 million in total capital improvement carryover. 

Despite that substantial number, over the next five years, Lee said, the city estimates there are still $253 million unfunded infrastructure needs, and more than $1 billion in total needs.

Complicating matters, the council opted to eschew city employees’ recommendation from a previous meeting to relocate city hall to the Agnews property, located on the former Oracle campus. 

In addition to capital needs, the budget also allocates money to hire new city employees, including two positions in the human resources department to hire more city employees, top brass positions in the police department as well as additional Silicon Valley Power (SVP) employees.

Since the council opted against the proposal to move city hall, the city will need to conduct a needs assessment — to the tune of $150,000 — to determine the most immediate infrastructure needs at city hall. City employees estimate repairs to the HVAC system and parking lots will each cost more than $5 million. However, $20 million in carryover money could fund those projects, should the needs assessment determine they are the most dire.

City Manager Jovan Grogan said city employees will, as per the council’s direction, return at the next regular meeting with a community advisory committee to get a better handle on how to proceed.

“We really need to establish what path we are taking,” he said. 

Council Member Suds Jain said the city should be investing in city hall since moving it will likely take between two and five years, depending on whether it’s moved to a new building.

The city also managed to shore up some of its reserves. It added $2.5 million to its budget stabilization reserve, $7 million to pension stabilization and created a capital infrastructure replacement reserve, which it put $10.4 million into. However, its general fund capital improvement project reserve shrank by roughly $8 million.

Although Lee only ventured a “best guess” as to how much money the Super Bowl generated, he said comparing the city’s transient occupancy tax (TOT) to the previous year showed roughly a $1 million increase with about a $100,000 increase in sales tax.

Lee was reluctant to use those numbers to extrapolate for the FIFA World Cup, slated to begin this week. He said he will return to the council to readjust the budget as necessary once the numbers are firmed up.

Both Mayor Lisa Gillmor and Council Member Kevin Park had numerous questions regarding senior center operation. A more detailed report on the topic will come before the council at a subsequent meeting.

Consent Calendar Spending

The council approved the following spending via the consent calendar:

• A $458,711 purchase order with Technology, Engineering & Construction, Inc. for fuel storage tank compliance testing and related services.
• A five-year, $349,748 agreement with Lyngsoe Systems, Inc. for the automated materials handling system at the northside library, including design, installation, and maintenance and support.
• A two-year agreement with Groome Industrial Service Group for professional heat recovery steam generator cleaning services, with up to three one-year options to extend for a total of $3.71 million.
• A three-year agreement with James Nicholson Enterprise for landscape maintenance services at Levi’s Stadium, with two optional one-year extensions for a total of $376,000. 

The next special meeting is at 6 p.m. on Monday, June 15 in the Council Chambers at City Hall, 1500 Warburton Ave. in Santa Clara.

Members of the public can participate in the city council meetings on Zoom at https://santaclaraca.zoom.us/j/99706759306; Meeting ID: 997-0675-9306 or call 1 (669) 900-6833, via the City’s eComment (available during the meeting) or by email to PublicComment@santaclaraca.gov

Contact David Alexander at d.todd.alexander@gmail.com