Oakland considers how to spend $29 million windfall

Oakland City Councilwoman Libby Schaaf, shown with Councilman Noel Gallo, is pushing for a rainy-day fund. Oakland City Councilwoman Libby Schaaf, shown with Councilman Noel Gallo, is pushing for a rainy-day fund. Photo: Michael Short, The Chronicle Photo: Michael Short, The Chronicle Image 1 of / 1 Caption Close Oakland considers how to spend $29 million windfall 1 / 1 Back to Gallery

Budget season is usually a bloodbath in Oakland, but this year leaders have a happy problem: how to spend an unexpected $29 million windfall from the hot real estate market.

The Oakland City Council has until Tuesday to amend the city's biennial budget to include the extra money, most of which is one-time revenue from home-sale transfer taxes.

Council members have varying ideas on how to spend the funds, but everyone agrees this is not the time for a shopping spree.

"We are still financially strapped," said Councilwoman Pat Kernighan. "We do not have a surplus. Even though our revenues are going up, we are still in a crunch."

Mayor Jean Quan and the city administrator's office recommended that the money go toward a reserve fund, paying down debt and pension liabilities, infrastructure and refilling some of the positions that were eliminated in the last few budget cycles.

They also suggested public safety projects, like an extra police academy, which would put another 50 or so officers on the street, and expansion of the ShotSpotter technology, Ceasefire program and police helicopter.

But Councilwoman Libby Schaaf said some of the mayor's ideas violate a city policy prohibiting one-time revenue from being spent on ongoing expenses. The public safety projects, including the police academy, should be a priority.

Instead, Schaaf is pushing for a rainy-day fund, intended to tide the city over in down times. It's similar to what Gov. Jerry Brown instituted in the most recent state budget.

"We need to set aside money to protect ourselves from the roller-coaster of the economy, so we're never again in a position where we have to lay off 80 police officers," she said. "This is not a conservative approach. This is what most cities do. It's sound fiscal practice."

Schaaf is challenging Quan in this year's mayoral election.

Oakland, along with almost all cities, has a reserve fund that's meant to be used in extreme emergencies, such as earthquakes. A rainy-day fund would give the city a cushion in case of future slumps in tax revenue.

Oakland currently has 646 police officers, up from 609 last year. By November, the city expects to have 707.

Councilwoman Rebecca Kaplan, another mayoral candidate, is also proposing a rainy-day fund, as well as a few new projects.

Among them: public works crews to patrol litter "hot spots," and a riding lawn mower for the parks department to better maintain the city's playing fields.

"A lawn mower seems like a minor thing, but it could make a huge difference for kids in the city," she said. "Right now, the parks department has no riding lawn mower. They have to beg public works when the grass gets too long."

As a money-saving tactic, Kaplan is suggesting that civilians perform some law-enforcement jobs now held by sworn officers.

"The (extra $29 million) is potentially good news, but the reality is that it depends what we do with it," she said. "That's the question."