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Council Approves Nearly $713 Million Belt-Tightening Budget for Upcoming Fiscal Year
By Jorge Casuso
June 26, 2019 -- The Santa Monica City Council on Tuesday approved a $712.9 million budget for the upcoming fiscal year that marks a steep drop from previous annual budgets, as the City tightens its belt to tackle a looming pension debt.
The budget -- down from the $802.1 million budget adopted last year -- includes no major new capital projects and leaves 29 unfilled full-time positions vacant.
It also increases parking rates and several other fees to generate revenues and funds a number of "community priorities," including expanding programs that address homelessness.
But the centerpiece of the budget that kicks in July 1 is a plan to pay down the City's estimated $448 million in unfunded pension liability by making a $9.3 million payment ("City Should Immediately Boost Annual Pension Payments, Report from Top Finance Official Recommends," April 23, 2019).
Paying down the debt using general fund dollars -- more than two-thirds of which pay for City services -- required making cuts and redeploying staff and resources.
But some of the changes initially proposed by staff were nixed or scaled back by the Council after feedback from residents at a budget study session earlier this month ("Proposed Budget Revised to Reflect 'Community Needs,' June 24, 2019).
The approved budget keeps the winter closure of the Santa Monica Swim Center to three weeks, from the six initially proposed, and reverses the previously proposed elimination of leaf blower and Conditional Use Permit (CUP) enforcement.
The new budget also addresses concerns about a slowly growing but increasingly visible homeless population by expanding the Downtown ambassador program and deploying a team of homeless outreach workers to the beach.
Under a six-month $250,000 pilot program, Downtown ambassadors would be stationed at Reed Park, which neighboring residents complain has been taken over by the homeless.
And it earmarks $400,000 in one-time funds to deploy a team of "cross-functional homeless outreach workers" to cover the beach.
Preserve Our Diversity (POD), a program that helps prevent homelessness by providing financial assistance to rent-burdened Santa Monica seniors also received a major funding boost.
Funding for the program will jump from an initial $200,000 a year in 2017 to $2 million, providing assistance for more than 200 participants instead of the current 21 ("City Program Offering Subsidies for Elderly Poor Renters in Santa Monica to Survey 'Wellbeing,'" November 1, 2017).
The budget also earmarks more than $1.6 million to boost cybersecurity and to maintain the new website the City will launch in the second quarter of next year.
Of that, $1.2 million will be spent to purchase and implement hardware and software security solutions to "minimize the likelihood of a security compromise, or readily detect and eradicate cyberattacks," according to the budget.
Another $425,000 will be used for "hosting, content support, a digital asset manager and ongoing web development support" for the new website, City officials said.
The budget also includes $8.45 million for the Human Services Grants Program to provide social services and $401,887 for Organizational Support Program Grants that fund arts and culture.
To help increase revenues, the budget increases rates for on-street metered parking, Main Street surface lots, the Pier deck and beach lots ("Parking Rate Hikes to Kick in Next Month," June 21, 2019).
And it builds in the cost of credit card transactions into fees and recovers the full cost of planning for the LA Marathon.
The biennial budget approved by the Council includes a $756.4 million budget for fiscal year 2020-21 that includes a $7.3 million pension payment.
The payments are part of a plan to pay down the City’s current unfunded pension liability over 13 years.
In a statement issued Wednesday, Mayor Gleam Davis said the budget looks to both the present and future.
“With this budget, we continue to invest in the exceptional services, programs and public facilities for which Santa Monica is known while also preparing for harder economic times,” Davis said.
“Budgeting based on performance and continually measuring how we’re doing will maintain our strong financial standing and allow us to continue to innovate to meet regional and global challenges like homelessness and climate change,” Davis said.
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