MEMO
Date: April 11, 2025
From: Christian Clegg, City Manager CC
Subject: Public Safety and Vital Services (PSVS) Fiscal Year 2025/26 Recommended Budget
To: City Council
Summary
The PSVS FY 2025/26 Recommended Budget totals $114,960,000, reflecting a 1% increase from the previous fiscal year. Major revenue sources include Sales and Use Tax, interest earnings, and a fund balance from prior-year savings. Personnel expenses, accounting for over half of the budget, are driven by rising pension, health insurance, and workers' compensation costs. Fleet expenses are rising due to higher vehicle prices and maintenance costs, while technology services costs have surged due to increased inve stments in cybersecurity and system upgrades. Liability insurance costs are also increasing due to higher claims expenses. To offset these rising costs, discretionary expenses have been reduced by 14%. Additionally, $7,809,500 is set aside for capital projects, pending Council approval.
Economic Overview
The U.S. economy is expected to experience slower growth in the next year, with GDP projected to increase by less than 1%. This cautious outlook stems from rising geopolitical tensions, new tariffs enacted in April 2025, and subdued consumer confidence fol lowing significant market volatility. While inflation has cooled to 2.4% annually in March, the Federal Reserve remains concerned about potential rebound effects from increased import costs due to tariffs. Interest rates remain steady between 4.25% and 4.5% to balance inflation risks and slow economic activity.
Despite some firms backing off recession predictions, the overall forecast suggests a fragile economy, impacted by policy-driven uncertainty and global trade disruptions.
Revenue
The total available resources for the PSVS FY 2025/26 Recommended Budget are $114,960,000, which includes $97,200,000 in Sales and Use Tax (adjusted by a minor accrual reduction of $25,000), $785,000 in interest and rebates, and a $17,000,000 fund balance. This represents a 1% increase from the FY 2024/25 Adopted Budget. The increase is largely due to a $5,000,000 fund balance from prior -year savings and a $434,300 boost in projected interest earnings. There is a decrease in revenue for the coming budget compared to the current fiscal year. This decrease is attributed to a projected $4,100,000 reduction in Sales and Use Tax collections due to prior misallocations of taxes by businesses, which led to an overpayment of approximately $8,000,000.
Operational Expenses
Total expenditures for the PSVS FY 2025/26 Recommended Budget are $114,960,000, with personnel expenses making up $62,258,236, or 54% of the total. Other expenses include $9,611,456 in non- discretionary costs, $22,910,945 in discretionary expenses, $1,212,000 for capital projects, and $11,990,500 in transfers to the General F und to cover operational needs .
Additionally, $7,809,500 is reserved for capital projects to be approved by the Council. The total discretionary allotment of PSVS dollars, which includ es the amount for capital project, is 26.7% of the PSVS budget.
Personnel
Personnel expenses, totaling $62,258,236, support 374 employees, with the majority serving in the Police and Fire Departments. Pension costs, recommended at $15,306,200, account for 25% of total personnel expenses, while rising health insurance costs of $5,711,707 reflect increasing prescription drug spending, healthcare labor costs, and medical inflation. Workers' compensation costs, recommended at $3,331,462, are rising due to high-risk duties in police and fire departments, and an increase in new employees has contributed to higher claims.
Fleet
Fleet expenses, recommended at $3,351,105, are rising by 44%, primarily due to increased vehicle prices from supply chain disruptions and inflation, as well as higher maintenance and repair costs for aging vehicles.
Technology Services
Technology services expenses are recommended at $3,167,763, representing a 108% increase.
This rise is driven by investments in cybersecurity, system upgrades, software licensing renewals, and inflationary pressures on technology-related services.
Insurance
Insurance liability costs are recommended at $2,960,482, a 20% increase, driven by higher claims expenses, particularly for property and general liability, as well as rising repair and replacement costs.
Utilities
The recommended budget for utilities (electric, gas, water, sewer, and trash) is $132,106. PG&E’s proposed rate increase is 1.6%, following a 13% increase last year.
Discretionary
Discretionary operating expenses total $22,910,945, a 14% decrease of $3,781,423, to help offset rising non- discretionary costs. This category includes professional services, repair and maintenance, supplies, equipment, and miscellaneous expenses.
Capital Expenses
The recommended budget includes capital projects categorized into two groups: recommended capital projects and additional optional projects. Given limited resources the City Council will only be able to select some of the optional projects, but all projects will be presented to the PSVS Oversight Committee for their findings prior to Council consideration. There are 8 recommended capital projects for a total cost of $1,212,000. The additional optional capital projects include 6 possibilities.
Recommended Capital Projects
Park Amenities & Renovation Improvements (PARI)
Cost: $500,000
Ward Various
Description: This project is a continuation in providing much-needed repairs and enhancements to the existing amenities throughout the City’s various parks and trails system. The City’s Parks and Trails system has seen an increase in public use and vandalism. Due to past budget constraints, the resources were not easily available to make necessary repairs and enhancements. The continuation of this project would provide funds to make renovations, repairs, and ongoing enhancements to existing park amenities during the year. Those items would include but are not limited to: Security gates, drinking fountains, picnic tables, park benches, shade structures, and other park-related and facility amenities. The project supports the following PSVS Priorities: Keeping public areas safe and clean & enhancing amenities throughout the community to improve the quality of life and attract visitors and Council Goals Reliable Infrastructure and Community Character & Quality of Life.
Wilson Park Sport Courts Renovation
Cost: $475,000
Ward 1
Description: This project is located at 2400 Wilson Road and consists of the removal and replacement of the existing tennis and basketball courts for Wilson Park. Originally constructed in 1960, the two sports courts have deteriorated over time, developing numerous cracks and alkaline corrosion, making the playing surface difficult to use. This project involves the complete removal of the existing concrete and the installation of new post-tension concrete slabs with a vapor barrier.
The courts will be upgraded with new acrylic sports surfacing and sports equipment to enhance each sport element. Additionally, the current two -court tennis layout will be converted into one tennis court and three pickleball courts, expanding recreational opportunities for the community.
The project supports the following PSVS Priorities: Enhancing amenities throughout the community to improve the quality of life and attract visitors and Council Goal Reliable Infrastructure and Community Character & Quality of Life.
Headquarters Flooding Mitigation
Cost: $60,000
Ward 2
Description: The Bakersfield Police Department headquarters has continued to experience water overflowing into the building at the east and west emergency exit stairwells. This flooding occurs during moderate to high levels of precipitation as water currently drains and gathers at each of these exit doorways which are below ground level. The existing drains in these exterior stairwells are undersized and inadequate to accommodate the water volume which then floods into our headquarters causing damage and unsafe conditions for our staff. The Public Works Department has been consulted and recommended awnings to divert the water and mitigate the flood issues in these stairwells.
Fire Station 4 Sewer Line
Cost: $51,000
Ward 3
Description: Fire Station 4 has been experiencing persistent issues with slow drains. A recent inspection by Bakersfield Plumbing revealed that the main sewer line is cracked beyond repair. As a result, wastewater is saturating the soil beneath the station, posing a potential risk of a sinkhole forming under the foundation. The necessary repairs include saw-cutting the concrete foundation, replacing the damaged section of the sewer pipe, and restoring the affected flooring.
Fire Station 11 Bathroom Repair
Cost: $51,000
Ward 6
Description: Fire Station 11 has been experiencing drainage issues in the bathroom area following the installation of a second commode, which replaced a urinal installed 15 years ago. An inspection revealed that the drainpipe contains hardened cement that cannot be removed, requiring extensive repairs. To properly address the issue, the bathroom floor will need to be saw-cut, and the affected section of pipe replaced. Additionally, the absence of floor drains has resulted in sewage flooding the bathroom and saturating the carpet during recent toilet overflows. To prevent future incidents, we propose installing floor drains.
Fire Station 3 Roof
Cost: $38,000
Ward 2
Description: The roof at Fire Station 3 has developed significant leaks due to its age and prolonged exposure to weather, making its replacement critical to maintain the safety and functionality of the facility. The leaks have caused water intrusion, which not only cr eates hazards such as slippery floors and potential electrical issues, but also accelerates the deterioration of the building’s interior, including ceilings, walls, and essential equipment. Continued water damage could compromise the structural integrity of the station, leading to higher repair costs in the future. Replacing the roof with a durable, weather -resistant system will prevent further damage, protect critical assets, and ensure the station remains a safe and operational environment for personnel to carry out their duties effectively.
Fire Station 2 Generator Switch
Cost: $27,000
Ward 2
Description: The existing generator transfer switch at Fire Station 2 is malfunctioning and requires immediate replacement. This critical component ensures the seamless transition to backup power during utility outages, a vital function for maintaining nec essary maintenance poses significant risks to the station’s ability to respond effectively during emergencies.
Fire Station 4 Generator Switch
Cost: $10,000
Ward 3
Description: The existing generator transfer switch at Fire Station 4 is malfunctioning and requires immediate replacement. This critical component ensures the seamless transition to backup power during utility outages, a vital function for maintaining necessary maintenance poses significant risks to the station’s ability to respond effectively during emergencies.
Additional Options Capital Projects
Street-Corridor Improvements along 18th Street and 19th Street Cost: $4,000,000
Ward 2
Description: This project will modify and enhance the corridors on 18th Street and 19th Street from F. Street to Mill Creek Canal with complete streets implementations. This project will enhance the street corridors while providing safer roadways, pedestrian pathways, bicycle facilities and various modernization aspects for a livelier feeling and outlook. The consultant prepared the conceptual drawings for both 18th Street and 19th Street. The design of this project was funded in FY 2021-2022. Phase 1 of this project will cover the construction improvements along L. Street to O. Street in FY 2024-2025; Phase 2 from F. Street to L. Street and Phase 3 from O. Street to Mill Creek Canal will be budgeted in future years. The first phase of the project, from L. Street to O.
Street, will be partially funded by Congestion Mitigation & Air Quality (CMAQ) Program funds, which provides funding in the amount of $2,205,210. The remaining funding outside of federal CMAQ funds will also have to be funded with local funds, which currently around $3,000,000 have been identified through Downtown Redevelopment funds. Ba sed on the currently bidding climate, this project is still anticipated to be $4,000,000 underfunded, which is where the PSVS funding would come in to close the gap. This project is about 95% complete with design and staff anticipate submitting funding approvals by June 30, 2025.
Corridor Improvements H St
Cost: $3,000,000
Ward 2
Description: This project is a continuation of the study performed by IBI Group for the Downtown Corridor Enhancement Streetscape Master Plan. The project will address the history and traditions of Bakersfield as well as its continued future as a transportation hub with the construction of the statewide High-Speed Rail System and Bakersfield's status as a future "Station City". The project will build on the "Making Downtown Bakersfield Plan" efforts which established that local Bakersfield residents want to see a Downtown that is vibrant, walkable, connected, safe and desirable. Previously, funding for the 30% design of H St was budgeted in FY 22/23. Funding for 100% design was budgeted for FY 23/24 and 24/25, with partial construction cost budgeted in FY 24/25. Active Transportation Program funding was awarded for FY 24/25. As design moves toward 100%, staff are requesting additional construction funding to account for changes in scope and cost escalation.
Antongiovanni Park
Cost: $700,000
Ward 7
Description:
This project consists of providing funding to develop a comprehensive design for the future 15 net acre park site. Acquired in 2005 as part of a developments Quimby requirements.
This undeveloped piece of land is located on Mountain Ridge Drive south of Berkshire Road adjacent to Miller Elementary School. This City owned park property is one of 9 undeveloped lands the City currently has in its inventory. By providing funding to begin the design work for the park. This will establish foundation to begin support for the construction of what could be the City’s 64th park. The project supports the following PSVS Priorities: Enhancing amenities throughout the community to improve the quality of life and attract visitors and Council Goal Reliable Infrastructure and Community Character & Quality of Life.
Centennial Park Improvements
Cost: $545,000
Ward 2
Description: Built in 1969 and located at 400 Montclair Street, this project consists of the removal and replacement of the existing playground equipment. The existing playground equipment is twenty-four (24) years old and has exceeded its useful life. Compared to modern playground equipment, it offers limited play value. The new playground will feature rubberized surfacing, ADA accessibility, and inclusive play elements. The project supports the following PSVS Priorities: Enhancing amenities throughout the community to improve the quality of life and attract visitors and Council Goal Reliable Infrastructure and Community Character & Quality of Life.
Design for Undeveloped Park Land Parcels
Cost: $450,000
Ward Various
Description: This project consists of providing funding for the planning and development of a comprehensive design for the one of the 9 undeveloped parks identified in the parks master plan.
In accordance with the Recreation and Parks Master Plan's recommended action plan for prioritizing various undeveloped parks, the project initially requires funding to begin the planning and design phase. The goal is to develop passive parks featuring amenities such as playgrounds, fitness stations, sports courts, and other desirabl e features. The planning process would include public engagement meetings to gather community input on the vision for these future parks.
Additionally, it would facilitate the development of design concepts, environmental reviews, utility coordination, and t he preparation of final design and bidding documents establishing a strong foundation for future construction. This project supports the following PSVS Priorities:
Enhancing amenities throughout the community to improve the quality of life and attract vi sitors and Council Goal Reliable Infrastructure and Community Character & Quality of Life.
Jefferson School Improvements
Cost: $200,000
Ward 2:
Description: This project will upgrade and add several pedestrian and bike -related improvements in the area surrounding Jefferson School. This project is a part of the Southeast Strong initiative aiming to develop and improve several neighborhoods and corridors in Southeast Bakersfield. The improvements planned for Jefferson School include enhanced crosswalks, high visibility striping, and other traffic calming measures. Design is planned for Fiscal Year 2025/2026 and Construction is planned for Fiscal Year 2026/2027.