Yorba Linda adopts two-year operating budget that shows hefty surpluses for each year

Nearly $72 million.

That's what Yorba Linda's elected leaders have budgeted to keep this city humming for two years – $35.2 million for the fiscal year that started July 1 and $36.5 million for the following year ending June 30, 2019.

And – happily – the city expects taxes and fees to cover all expenses incurred for both years, with a $572,000 surplus this year and $325,000 next year, which, when added to the existing stockpile, will leave an anticipated $21.8 million reserve at the end of the 2018-19 fiscal year.

Here are some highlights from the lengthy budget document adopted on a 5-0 vote at the June 26 City Council meeting, with estimates presented by Finance Director Scott Catlett:

--Most revenue will come from property and sales taxes, with property tax income increasing 7.6 percent from some $17.6 million last year to nearly $19 million in 2019. Sales tax income will drop about 1 percent from nearly $7.6 million in 2016-17 to about $7.5 million in 2018-19.

All other revenue sources will remain static or increase slightly by the end of the next fiscal year. These include franchise, property transfer, transient occupancy, business license and motor vehicle taxes and various recreation, building, engineering and planning fees.

--Most expenditures will be recorded in the public safety area, jumping close to 12 percent from last year's nearly $10.9 million to about $12.2 million in two years. The chief expense is for contracted sheriff's services, but also included is some $250,000 for crossing guards and $180,000 still paid yearly to Brea for police-related workers compensation claims.

Other expenses up for the two-year period: 7 percent for parks and recreation, 32 percent for administration and 8 percent for public works, with community development down 12 percent.

The city's current 130 full- and part-time positions will jump to 141 by 2018-19.

--The city's unfunded pension liability is expected to increase due to recent action by the state's Public Employees Retirement System reducing the assumed rate of return for the plan's investments, with a new valuation report due to the city in August.

Currently, the city plan is 72.4 percent funded, with $45.1 million deposited with and $17.2 million owed to the system. The city plans to make extra annual payments to amortize the liability by 2036, instead of 2046, which should result in “a significant savings.”

--The annual subsidy to the city's Landscape Maintenance Assessment District for several underfunded local landscaping zones will drop 17.5 percent over the two-year period, from nearly $1.2 million last year to $987,000 in 2018-19.

The city's contribution for the “general benefit” received by all property owners will jump 8 percent from $666,506 to $719,111, with total district income – funded by assessments on annual county tax bills paid by property owners – growing 2.5 percent to nearly $8.7 million.