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UPDATED: City uses fund shifts to cut deficit

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With some adjusting here and there, the city of Berkeley no longer has a $2 million deficit in its general fund.

It still has a $90,837 deficit and a no-frills budget for 2007, but that's a lot better than the situation a month ago, said City Manager De'Carlon Seewood.

Cutting the deficit was a matter of reviewing the city's financial structure and figuring out where revenue should be going.

"We shrank some fund balances," he said.

Typically, the general fund includes expenditures for police and fire protection, public works, street maintenance, facilities, the municipal court, the city council and administration.

The city also has separate capital, fire equipment, park and sewer lateral funds.

Seewood said the balances in these funds were higher than needed and had not been adjusted to place funding in the general fund.

And that's what the city council did Aug. 6 when it approved two resolutions and a flurry of transfers in and out of these funds and the general fund.

One resolution amended the budget to include some expenditures in 2006 that needed to be transferred to the city's 2007 fiscal year, which began July 1. In all, $973,455 was transferred from other funds into the general fund.

The second resolution deals with the 2007 budget. The budget was amended to appropriate a transfer amounting to $975,688. Of this total, $279,292 came from the capital fund, $6,227 from the fire equipment fund, $680,169 from the parks fund and $10,000 from the sewer lateral fund.

Seewood said the transfers would not affect services.

"They will fund services that have been budgeted for," he said.

In June, city officials were saying it might take as long as five years to shrink the deficit. Seewood, who at the time had been on the job for a month, said he wanted to cut the deficit to $1.58 million during the 2007-2008 fiscal year.

Reach Brian Flinchpaugh at

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