Long Beach projects $10.8 million surplus after expecting $8.8 million deficit this year
The City Council will decide later this year how to spend extra funds with staff recommending that $7 million be used for "high-priority" projects.
Long Beach’s budget outlook for the current year is looking better than when the City Council adopted the spending plan last September with the city now projecting the year will end with a $10.8 million surplus.
The council approved the budget last year which had a $8.8 million deficit at the time, requiring the city to use reserves to close the funding gap. Cities are not allowed to run budget deficits like the federal government.
However, city budget officials briefed the City Council Tuesday and said that some city revenue sources like hotel taxes, ambulance fees, the utility users tax and oil sales are all contributing to the new projected surplus.
City Council approves pilot that will allow e-scooters on Long Beach's beach bike path
Jason Ruiz • Jun 18, 2024
Electric scooters will be allowed back on the Long Beach bike path starting after the City Council voted Tuesday night to approve a pilot program that could see scooter riders on the path for up to 12 months. The council voted 6-1 Tuesday to tem…
Read full story →
Rebecca Bernstorff, a budget manager with the city, said that staff is recommending that about $7 million of that surplus be used for high-priority projects, which the City Council will determine through this year’s budget process that begins later this year.
But Bernstorff cautioned that despite this year's surplus, the city is still projecting budget deficits of $8 million to $11 million over the next few years. The year-end budget totals will be presented to the City Council in February.
Sales taxes, one of the city’s largest sources of revenue, are underperforming according to the city’s presentation. Both regular sales tax and the city’s Measure A tax, a 1% sales tax that city voters approved to fund infrastructure and public safety, are projected to finish lower than the budget staff projected last year.
Jason Ruiz has been on strike from the Long Beach Post since March 21, yet he’s still covering city hall without pay. Thank him for his reporting.
Together, they’re about $9.6 million less than what was expected. The city points to lower holiday season sales and other declines or flattening out in sales of vehicles and other consumer goods.
Some city departments are cumulatively projected to see tens of millions in savings due to staffing vacancies or retirements with the Long Beach Police Department ($10.5 million) reporting the largest savings, according to city documents.
However, budget staff said these savings are not expected to continue if a more normal labor market is seen in the future. The city is trying to speed up hiring and could ask voters to approve a charter amendment in November that city officials believe will help fill the existing shortages, which has contributed to about 22% of all city jobs being vacant.
BREAKING
Music instructor arrested on suspicion of exposing himself to a child, 2 women, LBPD says
Fernando Haro • Jun 19, 2024
A Long Beach music instructor has been arrested on suspicion of exposing himself to a young girl and multiple woman between 2021 and 2022, and there may be additional victims, according to police. Police say 25-year-old Silas Topzand is suspected of first exposing himself to a woman in Septembe…
Read full story →
The budget year starting this October has a larger projected deficit with the city working to close a $23.4 million gap. Potentially compounding the city’s future fiscal issues is the likelihood that oil revenue will begin to disappear faster than anticipated due to a new state law that could be approved by voters in November.
A city audit released this month said that the city stands to lose over $300 million over the next ten years due to the law but also production declines as the oil becomes more expensive to extract.
The city is currently looking at a variety of taxes that the City Council could put on the November ballot including business license fee increases, higher utility fees and a potential real property transfer increase that could see property owners pay about five times more to the city after they sell a property in Long Beach.
The City Council is expected to decide whether it will ask voters to approve one of those taxes by its Aug. 6 meeting.
Don’t let Long Beach turn into a news desert. Become a Watchdog today.
We need your support.
Subcribe to the Watchdog today.
The Long Beach Watchdog is owned by journalists, and paid for by readers like you. If independent, local reporting like the story you just read is important to you, support our work by becoming a subscriber.
