Adam Kaye is no longer reporting for the North County Times and is now covering Encinitas for the San Diego Union Tribune,
Read the article online: City budget not affected by economy
Excerpts,
On Wednesday, the City Council took its first look at a draft $53.5 million operating budget for the next fiscal year that shows $2 million less in revenue than initially projected but hefty reserves and no cuts in jobs, programs or services.
Property tax is the city's No. 1 revenue source, but in contrast to the flagging real estate market elsewhere, Encinitas anticipates a 2.9 percent increase in property tax revenue for the fiscal year that begins July 1.
In Encinitas, foreclosures are low and property is holding its value, though home sales have dropped dramatically, Smith said.
In the 92024 ZIP code of Encinitas, home resale prices in the first quarter of 2008 rose by nearly 7 percent over the first quarter of 2007, according to statistics released last week by DataQuick Information Systems. The number of home resales dropped from 111 to 73 for the same period.
Encinitas was one of three ZIP codes in the county where resale prices rose between Jan. 1 and March 31 of this year and last.
A belt-tightening exercise throughout City Hall has trimmed $605,000 from the budget, finance manager Darlene Hill said.
The exercise included some personnel shuffling, resulting in a slight cut in hours for one full-time employee. That would bring the number of full-time positions to 240.6.
The budget shows an increase of $203,252, or 0.4 percent, in revenue from fiscal 2007-08. The increase, however, falls far short of the $2 million budget increase projected one year ago.
Less-than-expected revenue would stem in part from $1 million less in projected sales tax and receipts, which the fiscal 2008-09 budget estimates at $8.2 million.
Income from permits, inspections and plan checks is expected to decline by $539,000, or 10 percent, reflecting a slowdown in construction.
On the other side of the ledger, revenue from red-light cameras, fines, fees and other penalties is budgeted to increase by $60,000, to $878,200, which officials attribute to an increase in parking citations.
See also, Encinitas Taxpayers Association Blog
*The total budget for the city of Encinitas is $53.5 million dollars which is what the CEO of Goldman Sachs received as a bonus in 2006. source
How is it possible that a change in the economic conditions won't affect city revenue? Smells like an election year.
ReplyDeleteWait a minute here. I was at the budget workshop and I saw Adam Kaye there. I think he gives a slightly too optimistic assessment of the economic situation. Financial Director Jennifer Smith gave a less rosy picture. It is true that property tax revenue is steady, down very slightly. But Smith stressed that new building is down, consumer spending is down, development fees are down, and sales tax revenue is down.
ReplyDeleteAll of this has made it necessary to restrict capital improvements to core infrastucture and facilities and to high priority city council goals. It has also made it necessary to temporarily use the budget stabilization reserve. What this means in simple language is belt tightening, cutbacks, and postponements of certain projects.
Here are the figures given:
Property taxes down $90,900
Sales & use taxes down $1,171,000
All other taxes down $142,000
Intergovernmental Revenue down $167,000
Charges for services down $539,000
TOTAL down $2,080,000
That's a pretty hefty figure. Add in the loss of investment earnings dropping from 4½% to 2½%. And there is the 15% raise the city just gave to employees over 4 years, even after public speakers said it was ill-advised with the worsening economic situation.
Mayor Jerome Stock was bragging about how the city has been ahead of the curve on this downward slope. Not true. I give credit to Jay Lembach and Jennifer Smith for speaking honestly about the problems we face. But it's an election year and they take their orders from Stocks and the other two men. Still they couldn't whitewash the situation completely as they had been doing previously. After all that pay raise was only a couple of months ago.
Does anyone think that the economic situation has bottomed out? I don't. It will surely get worse, maybe much worse, before it gets better. It doesn't seem our city is prepared for that. This is the reason Teresa Barth asked that the discussion be brought back as a single agenda item, so everything could be discussed detail.
I agree with Councilwoman Barth, it's time to talk about a hiring freeze at City Hall. A consultant freeze should be considered as well.
ReplyDeleteHow about a real evaluation all programs and positions. Drop the dead wood keep the sap wood.
ReplyDeleteWe have 2 city managers. Phil Cotton and Peder Norby.
ReplyDeleteI found this last portion of the article telling.
ReplyDeleteDuring Wednesday's hearing, members of the Leucadia 101 Main Street Association asked the council to increase the group's annual subsidy from $20,000 to $30,000. The private, nonprofit organization works on revitalization projects in the North Coast Highway 101 area of Leucadia.
Patricia Bell, the group's president, said the group needs the money to pay for rent and increased hours for its program manager.
Bell said the group would be an important liaison between merchants and City Hall as the city proceeds with a multimillion-dollar improvement program for the highway.
Council members seemed to support an increased subsidy but debated where to find the money. Barth suggested eliminating a public opinion survey that she and Councilwoman Maggie Houlihan had voted against.
“I can find $15,000 in the budget,” Barth said. “Let's skip the opinion survey and then we'll have a wash.”
“I couldn't agree more,” Houlihan said. “That's a great place to look for funding.”
“That's fair,” Mayor Jerome Stocks said. “I couldn't agree less.”
That man's arrogance is stunning.
I am a professional translator. Allow me to translate what mayor Jerome Stocks is saying to all Leucadians,
ReplyDelete'I sit on the NCTD board and our scorched earth program against Leucadia is a rousing success. All Leucadia merchants and property owners are lower than the scum on my shoe.'
Jerome had it backwards. First scorched earth THEN comes the floods.
ReplyDeleteJerome is blatantly and obviously arrogant. When staff, through the City Manager, Phil Cotton, brought an agenda item on policy change to the agenda, the week before last at the regular Wednesday's council meeting, James bond nominated Maggie and Jerome, Deputy Mayor and Mayor (should have been other way around with Maggie as Mayor, we all know) as another subcommittee.
ReplyDeleteStocks said, "I don't want to do this! Just kidding."
No such thing as a joke, Jerome.
Oh, and at the so-called budget workshop meeting, which came before the San Dieguito Water District Meeting, and the regular council meeting, James Bond said we could get some money to help pay North.101 Mainstreet by NO LONGER PAYING TO PUBLISH CITY AGENDAS! NOT a good idea!!
The three man City Council majority is doing everything in its power to decrease public participation and open government. Another excellent article by Adam Kaye in Saturday's (yesterday, 3/26/08) Union Tribune, "Field of candidates taking shape for council contest."
nanningaforencinitas.org
ReplyDeleteThe City has $20 million in unfunded health care retirement program liability it needs to pay.
ReplyDeleteI think the City Council should cut 20% staff at city hall. Use 50% to pay for the lucrative staff pay and benefits liability and use the other 50 % for community improvement projects like park, street improvements, and landscaping.
A few easy staff cuts are the Art Director - line item cost in budget $140,000.
Also 20% and planners and engineering, since the developments has ceased and there is no need for the positions.
Hiring freeze my Ass- The council needs to direct the City manager to lower the operating budget by 20%. Get it done. We should not be paying for these workfare positions.
The city has no business being in the day camp/child care business, surf lessons, egg hunts, ad infinitum. Every time the community calendar of events is mailed out (on ever increasingly expensive glossy paper), I cringe. Hell, they even had dodgeball for adults offered recently. Such activities are best left to private enterprise, the YMCA, or churches. City staff is bloated, underworked and spoiled rotten. Talk about the gravy train...
ReplyDelete