LIVE OAK, CA (MPG) - At the Live Oak City Council meeting on Oct. 15, resident Dale Carlson submitted a written public comment discussing his concerns about the city’s precarious financial position due to what he called a pattern of “reckless spending.”

City Manager Ben Moody requested council discussion about two purchases that already have funds allocated in the current budget: $74,098 for a new tractor and $30,738 for a new sewer pump. Moody said the sewer pump is a necessary expense to maintain the utility. However, he suggested delaying the tractor purchase to look at used options instead.

Councilmember Nancy Santana said all purchases should be deferred until the city finds a way to cover the cost of police and fire services.

The rest of the council said it was important to ensure sewer operations are maintained, so they agreed to delay the tractor purchase but move forward with the new pump purchase. The vote was 4-1, with Santana dissenting.

Next, the council considered establishing an ad hoc committee to review options for updated police and fire contracts through Sutter County. Due to the city’s structural budget deficit, the council previously voted to send notices of contract cancellation in order to negotiate new terms that the city can sustainably afford.

The proposed ad hoc committee would be comprised of two councilmembers who would attend meetings with the city manager and police and fire representatives, report back to the full council, and make recommendations.

Councilmember Santana said she was “not a fan” of ad hoc committees.

“We had one before and I didn’t feel like there was full transparency,” Santana said.

She argued that two members would not be able to accurately recall details of the negotiations. Instead, she suggested the full council be involved in the meetings.

Vice Mayor Pamma said he would like to volunteer for the ad hoc committee.

“I want to take part in these conversations and do the best for our citizens,” Pamma said.

He said currently the only city representative in the meetings is the city manager, so adding two councilmembers is “an advantage.”  

Councilmember Woten pointed out that in order for the full council to be part of these discussions, they would have to be held as public meetings.

Residents and other councilmembers can submit questions to be discussed in the ad hoc meetings, so Councilmember Hernandez said the committee acts as direct line for citizens. She agreed it would be too time-consuming for staff of the city, police and fire to hold public meetings for every discussion.

Woten nominated Pamma and Santana to serve on the ad hoc committee. Santana voted no and declined to serve, citing concerns about lack of transparency.

Pamma said, “What better way to ensure full transparency than to sit on the ad hoc committee?”

The initial motion was withdrawn, and a new motion nominated Pamma and Hernandez to the ad hoc committee, which was approved 4-1, with Santana dissenting.

In a further effort to address the budget issues, City Manager Moody brought back a recommendation to temporarily reduce the city’s development impact fees by 50% to encourage development. Short term, the change would reduce the amount of fees collected, but new development brings new residents, which brings more long-term property tax and sales tax revenue to the city.

Moody said the city’s current development impact fee for a single-family home is $32,000, which was set in 2011 and has not increased over time to keep up with inflation. The rate is about 54% below the typical cost in the region of around $50,000 per home. Decreasing the fee to $16,174 per home could spur immediate development in the city, but then planned increases of 10% over the next six years would gradually bring the fee in line with the rate of inflation.

The change would also include a variable timing for fee collection, from permit issuance to certification of occupancy. If approved, the changes would go into effect on Jan. 1, 2026.  

During public comments, a local developer said cutting fees incentivizes development in rural areas where margins are tighter.  He said, “I think it will work here,” and he looks forward to doing business in the city.

Another resident worried that if the city locks in a low fee level, the state could enact new regulations restricting how much they can increase fees. But Moody said there will be review of the fees over the next few years anyway, and legally the fees just need to match the actual impact on the city for infrastructure and services.

Councilmember Santana wondered if the reduction would actually increase development, or if it would put the city at risk of losing money.

Vice Mayor Pamma said the city has already seen this work, when the Garden Glen developers requested similar fee levels back in 2019. Pamma said the city needs the sustainability of new residents and new revenue. He added that the wastewater treatment plant has the capacity for many more homes than it currently serves.

“We have room to grow,” Pamma said. “Let’s try to spur something here to help our local economy.”

Hernandez said, “If we do nothing, we’re going to get nothing.”

Mayor Chapdelaine said, “These struggles, we knew they were coming,” and addressing them is “going to take a multipronged approach.”

The council voted unanimously to approve the updates to the development impact fees.

Finally, City Manager Moody recommended establishing a job classification for a Community and Economic Development Director and requested approval of $125,000 for this permanent full-time position.

Moody said this role is critical but is currently filled through a consultant contract that costs the city $264,000 annually. Shifting this work to an in-house staff position will increase efficiency, provide focused advocacy, and save the city money. With this position and the part-time assistant planner and code enforcement officers previously approved, Moody said the city can terminate their consultant contract, for a total savings of $55,000 per year through this restructuring.

Councilmember Santana said she didn’t understand why the city would spend $125,000 to hire a new position when they can’t afford their police and fire contracts. She suggested a hiring freeze until after the police and fire contracts have been settled.

Moody said, “The city is multimillion dollar business. We have obligations and services that have to be provided. It’s not all or nothing.”

Santana continued to express confusion and objected to the new position. Moody explained again that the city already pays a consultant, so shifting to in-house staff provides a cost savings.  

Hernandez said it would be a huge benefit to move away from contract costs — and the new position would provide a focus on economic development, which has been a council priority.

Mayor Chapdelaine said, “These consultant contracts have been draining the city for years now,” and hiring actual city employees “will be a cost savings.”

Woten said, “We’re not shutting down the city. So, we’ve still got to maintain and do all the things we’re responsible for doing.”

Pamma said, “We’re getting rid of consultants who charge an arm and a leg, to bring someone in-house who’s 100% devoted to this town.” He asked staff to create a chart for public release to ensure residents understand the benefit of this position and the associated cost savings.

The council voted 4-1 to approve the new position, with Santana dissenting.  

Mayor Chapdelaine added that the city is dedicated to working with their county partners to continue fire and police services.

The next meeting of the Live Oak City Council is scheduled for Oct. 29.