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Published February 22, 2017
Despite small surplus, asset replacement still a challenge

The town of Moraga continues to scramble to find money to fund the replacement of its assets such as police cars, computers and generators. The mid-year budget review presented by Administrative Services Director Amy Cunningham showed a slightly better than expected general fund surplus, and cited money available from developers' fees eligible for specific uses.
These financial elements were key to the council's decision to fund a pilot surveillance camera project and a few asset replacement items, but many other needs were put on hold for lack of funding.
Cunningham presented a long list of needed replacements that are unfunded at this time. Moraga prides itself on having a balanced budget, and it is true of the general fund that pays for everyday expenses, but it is achieved at the cost of the capital improvement and asset replacement funds that have been grossly underfunded for years. At the end of 2014 an audit and finance subcommittee stated that the town should be saving more than $600,000 a year for asset replacement; and since that had not happened for years, it estimated the unfunded depreciation balance to be more than $5 million. That does not include the millions that would be required to address delayed storm drain maintenance.
Some examples of this underfunding include the delay in replacing police cars, repainting the library, replacing information technology infrastructure, and the $200,000 of repair and maintenance costs at the Hacienda de las Flores. Staff estimates that the total unfunded needs for this budget cycle equals approximately $517,000. The asset replacement fund is depleted at this time.
Additionally, the generator at town hall will soon need replacement, the new gateway signs to signal the entrance of the town are not funded, and some planning processes also need additional money: the Moraga Center Specific Plan zoning project, the livable Moraga Road project, the Hillside and Ridgeline Regulation update, and a proposed after-school enrichment program.
Since the beginning of the year the town has saved $90,000. Cunningham proposed that the savings be allocated to asset replacement, to a new town surveillance camera pilot program and to overtime consultant services. The town is also anticipating that this year the surplus will be $190,000. Cunningham recommended the surplus be allocated to the town reserves, bringing this fund to about $2.6 million or 34 percent of the operating budget, still short of the 50 percent target.
In addition to the general fund, the town has other funds that can be used. The one-time-developer-fee fund (Palos Colorados development) totaled almost $3 million, half of which has been earmarked for sinkhole repair. The development impact fees fund has over $1 million available that can be used for specific types of expenses, such as public safety, general development or park development.
The council agreed to fund the pilot town surveillance camera using the public safety development fee fund. The new gateway signs at the town entrances did not get a lot of support given their high cost of $41,000. The asset replacements needed at the Hacienda were put on hold.
Several council members noted that the town should be looking into ways to replenish the asset replacement fund. Cunningham noted that the audit and finance subcommittee will propose ways to reinvigorate this fund in the near future.
Town's goals discussion pushed back

Despite a large group of people who came to council on Feb. 8 to participate in the goal setting discussion, the council adjourned the meeting at 11:45 p.m. The topic is again on the agenda for the Feb. 22 council meeting.

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