How Deep Is The Budget Quicksand?

MORE BUDGET BAD NEWS
At the Costa Mesa City Council meeting on Tuesday, March 2nd, City Manager Allan Roeder and Budget and Research Officer Bobby Young will present to the council their assessment of the city's current fiscal condition, and their 7-point plan to help resolve part of the current situation.

STAFF REPORT AVAILABLE FOR REVIEW
You can review the staff report HERE. In a nutshell, it tells you that the 10-point plan approved last year was successful even though some of the strategies did not yield the results hoped for. It did result in savings of $22 million for this fiscal year.


7-POINT PLAN
However, the economy continued to tank, resulting in a shortfall of $9 million for this year, hence the need for the 7-point plan. That plan is defined as follows: (savings noted in bold parens)

1. A freeze on filling all current vacancies (except Police Patrol, as needed, and Sworn Fire to meet minimum manning) ($500,000);
2. A freeze on Capital Outlay Purchases and Capital Improvement Projects using General Fund Revenues ($1,467,000);
3. A moratorium on new programs and services, expansion of existing programs and services, and new projects requiring General Fund support (0);
4. A review of Equipment Replacement Fund reserves ($1,450,000 +$1,700,000 ins. premiums);
5. Initiation of discussions with Employee Associations regarding wages and benefits (0);
6. Preparation of tax schedules with alternatives and supporting resolutions for the Transient Occupancy Tax (TOT) and Business License Tax for the November 2010 ballot (0); and
7. Submission of all Programs and Services to the City Council for budget prioritization (0).

ONLY HALF-WAY THERE
This plan will provide savings of $5 million, leaving the current fiscal year $4 million short. You can review the details of the plan in the staff report. It's clear from the tone of the staff report that layoffs seem very likely in the near future. It's also clear that recommendations will be made for increases in the Transient Occupancy Tax and Business License Tax, but those can't happen until next November and only by a vote of the electorate.

WOW! THAT HURTS!
One attachment to the staff report is entitled "Service Impacts From Vacant Positions" and can be found HERE. This one will pop your eyes open and make you realize just how extreme our fiscal condition has become. It lists, by department, the positions presently vacant and the impact of not filling them. As you sift through that information you'll get a better idea of just how extremely troubled our fiscal situation actually is.

LONG AND PAINFUL MEETING ANTICIPATED
Tuesday's council meeting has all the earmarks of being one of those long, painful experiences that will test the mettle of our elected leaders and the staff. The difficult decisions made last year, while admirable, don't come close to those that will be necessary in near term - and this is just to balance the current fiscal year budget. The other shoe waiting to drop is the next year's budget. The discussions for that budget are scheduled to begin soon.

CONTACT THE COUNCIL IF YOU HAVE IDEAS
If you review the staff report and have suggestions for the council to consider, email them immediately or call City Hall with your suggestions. Now's the time to be heard.