HomeMy WebLinkAbout1993-07-13 - AGENDA REPORTS - BUDGET 1993 /94 (2)AGENDA REPORT
DATE: July 14, 1993
SUBJECT: Budget 1993/94
DEPARTMENT: City Manager
BACKGROUND
City Manager o a
Item to
George Caravalho
This item is on the agenda to discuss the adoption of the California State Budget and its
corresponding impact on the City of Santa Clarita. Early in the City's budget preparation
process, notification was received that as a result of the States' potential budget balancing
actions, Santa Clarita could lose approximately $886,000 in Property Tax. This reduction coupled
with the stagnate economy and reduced interest income lead the City to reduce its general fund
operating budget by $2.8 million. In order to adequately prepare a balanced budget, and address
this potential shortfall, each department sustained reductions. However, with the adoption of the
State Budget package, it now appears that Santa Clarita will not lose the $886,000 in Property
Tax Revenue originally anticipated. As you will recall however, $157,000 of this amount has
been designated to compensate for a reduction -in -Motor Vehicle in Lieu Fees Revenue.
Therefore, at this time, there is potentially $729,000 in funds not designed for a specific purpose.
While this funding appears available at this point in time, it should be noted that various
reductions were originally enacted to close the anticipated shortfall. These reductions include but
are not limited to:
Underfunding Fleet Replacement
200,000
Elimination Community Service Deputy
109,000
Conversion of Traffic Cars
180,000
Implementation Newhall Study
100,000
Valley Master Plan
80,000
Oak tree Consultant
20,000
Recreational Programs
150,000
-
Agenda Item:
Reduce Tree Trimming/Spraying
280,000
Reduce Street Sweeping
150,000
Additional Reductions (staffing / programs)
720,000
Crossing Guards
30,000
In addition to the items eliminated to address the shortfall, other. issues have arisen which may
require funding. These items include the following:
• Enhanced Elsmere funding
• Property Acquisition (Saugus Site)
• Property Acquisition (Anawalt)
• Funding Four Oaks area improvements (High water table)
Further complicating the funding issue is the continued State Budget uncertainties as they pertain
to the November Ballot Issues. The current State Budget is predicated upon the fact the
extension of the 1/20 sales tax for public safety will succeed in November. This extension will
direct $1.5 billion to counties throughout the State for increased funding of public safety needs.
Should this measure fail, the State may again look to cities an counties to absorb the shortfall
through the redistribution of services or reduction of revenues to local governments. The direct
impact to Santa Clarita if the ballot measure were to fail is not immediately known.
Given the reductions to the City budget, future anticipated needs, the potential reduction of
County service for in this area (i.e. reduction in library hours and park closures), coupled with
the continued economic uncertainties facing all cities, it is suggested that the City take no action
at the present time to appropriate the remaining General Fund Property Tax Revenue. Rather
it is recommended that the City Council conduct a thorough review of the City's fiscal and
budgetary condition between late summer of 1993 and January of 1994 and make adjustments
at that time. However, should the Council wish to immediately fund items listed, it is
recommended that the contingency fund of $1,485,000 be utilized.
RECOMMENDATION
That the City Council receive report and direct staff to bring budget adjustments to the City
Council for review between late summer of 1993 and January of 1994.