Berkeley City Council voted to place an initiative addressing concerns regarding the city’s unfunded liabilities on the November ballot at its meeting Tuesday night.
If approved by voters, the Berkeley F.A.C.T.S. — Fiscal Accountability, Clarity, Transparency and Sustainability — Ordinance would require the city to prepare and publish a biennial report specifying financial obligations, including employee-related costs and capital improvements, over a 20-year period beginning March 1, 2013.
The initiative also specifies the council would not be able to change fees, assessments and taxes unless the financial report had been prepared and certified by the city manager or an independent professional. Future updated reports would be published every two years on the first Monday in March.
According to the Fiscal Year 2012 & 2013 budget book, Berkeley faces around $330 million in unfunded liabilities, which are costs that are not presently due but must be paid in the future, of which pensions account for $205 million.
“The city’s projected revenue growth will not keep up with current and projected expenditures for city employees, and unless significant changes are made, there will be substantial decreases in available funding for vital city services,” the initiative reads.
The Committee for F.A.C.T.S. — a committee that is a part of the Berkeley Budget SOS, an organization dedicated to improving the city’s financial budget — gathered 3,466 signatures to place the initiative on the ballot.
However, about a month ago, the council passed a resolution relatively similar to the F.A.C.T.S. initiative. The adopted resolution asks the city manager to create a report of the city’s unfunded liabilities beginning in February 2013, with future reports to be published every two years.
Unlike the initiative, the council would still be able to issue or change assessments, fees and taxes without certification and publication of the report. The resolution also would require the report cover a 10-year period.
“There’s no guarantee that the council will follow through (in their resolution),” said Jacquelyn McCormick, coordinator of the committee and a mayoral candidate. “There is motivation in our initiative.”
According to city Legislative Assistant Jill Martinucci, the city attorney said if the initiative passes, the initiative and the resolution would be combined, except where there were distinct differences. In that case, the initiative would take precedence over the resolution adopted by the council.
“(The chances of the initiative passing are) extremely good,” McCormick said. “There’s a huge enthusiasm around it.”
Daphne Chen covers city government.
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