Juana Espinoza, Lindsay’s director of finance, projects that the city will have to use $500,000 from the general fund to pay for water operations at the end of the fiscal year
LINDSAY – Financial hardships of the past have muddied the water fund in Lindsay, but finance director Juana Espinoza said the general fund is able to cover additional water costs in the city, for now.
At the Jan. 10 city council meeting, Espinoza gave the council a quick rundown of the city’s finances for the fiscal year of 2023. In her presentation, she mentioned that though the general fund is healthy, the water fund is struggling to keep up with its expenditures. By the end of the fiscal year, Espinoza projects the city may have to pull roughly $500,000 from the general fund in order to cover the city’s water costs.
“We cannot talk about the general fund exclusively. Any conversation around the general fund is also a water conversation,” Espinoza said. “Unfortunately, [other] departments are still being restricted because of the unknown help that we will have to give the water fund.”
Espinoza said that she does not believe the water fund will be balanced by the end of this year. She also said that there are no operating emergency or capital reserves, but that the general fund is in a good position to cover any deficit in the water fund.
Despite the recent deluge of rainwater agencies project conservative rainfall for the next two years, there still might not be enough to offset the droughts that California has experienced for so many years, according to Espinoza.
Luckily, the general fund is in a healthy condition, according to Espinoza. The revenues of the general fund are right at what the city budgeted for. The expenditures of the city are actually lower than they budgeted for, giving Lindsay a surplus of money that they can focus on project planning, according to Espinoza.
“That is very good, because that means that our planning for revenues was spot on, which is a very hard thing to track, especially when it deals with sales tax and other forecasted metrics,” Espinoza said.
Overall, though, Espinoza said that “significant economic indicators are behaving as expected” when it comes to the city’s general fund for the 2022-23 fiscal year. The city’s sales taxes, business licensing and permitting revenues are leveling out, as the year prior they had peaked. This is because last year, people were online shopping, visiting recreational sites that had been closed due to the pandemic, and much more, according to Espinoza. Now, after inflation and other economic struggles plague the country, people are “getting ready and planning for the future,” according to Espinoza. This led to people saving, even with record low unemployment for Lindsay and surrounding areas.
Statewide, Espinoza said that inflation is not getting higher, but instead is “flattening.” This is not ideal, but it’s also not getting worse. She said that since California is projecting a $5 billion revenue shortfall, they may not be able to help cities financially in ways that they have before.
“I’ve noticed with any type of projection like this, it changes the entire calculation of how you’re going to plan going forward,” Espinoza said. “Any funding that we might have received from the state in terms of support for water or sewer, or any type of help that we might have expected, we can no longer count or plan on that.”
Though the water fund may be struggling, the overall finances of Lindsay have improved throughout the past few years. To her, that is a good spot to be in, because as the city operates smoothly in other areas, it gives staff the space to focus on issues like the water fund.
“You see all these positive things [in the city]. That’s a great position to be in because for many, many years, the city did not have any positives,” Espinoza said. “The fact that we now have this one issue allows us to concentrate a lot of resources into making sure that this is something that is solved to the benefit of the residents.”