In a promising sign towards economic recovery, the City Council is set to vote on the updated FY 2021-23 biennial budget that projects no deficit.
This budget signifies a marked improvement from staff’s early pandemic predictions, which projected an annual General Fund deficit of $48 million, $102 million and $74 million over the coming years.
“Within its reduced footprint, the FY 2021-23 Biennial Budget supports a first-class local government capable of meeting essential community needs and providing a solid foundation for regrowth,” said Interim City Manager Lane Dilg.
Dilg attributed the improvement in economic fortunes to the underlying strength of Santa Monica’s industries and desirable location, alongside new revenue streams such as Measure SM.
The overall budget is $705.5 million in FY 2021-22 and allows the City to ramp up several services cutback during the pandemic with a focus on addressing the council-identified community priorities of tackling homelessness, advancing economic recovery, and keeping the City safe and clean.
It also plans for the hiring of part and full-time employees who will collectively work the hours of 17.6 full time staff members. The proposed additions include three library employees, more crossing guards, staff for the reopened pool, and trash and recycling equipment operators.
The new budget, however, is a far cry from a full economic recovery, which is expected to take several years. Interim City Manager Lane Dilg warned residents that “a disconnect will remain between City resources — which have been reduced as a result of the pandemic — and community expectations — which have not.”
The General Fund budget is $349.5 million in FY 2021-22 and $375.3 million in FY 2022-23. Both of these are around $100 million shy of the pre-pandemic General Fund budget in FY 2018-19.
The City released its Proposed Budget for FY 2021-23 on May 10, 2021. Council members examined the budget at study sessions on May 25 and May 26 and heard extensive public comment. After discussion, members of Council expressed support for the proposed budget and asked staff to reexamine certain elements to better support the Council-identified community priorities.
The FY 2021-22 proposed budget as revised is $706.8 million and $598.9 million in FY 2022-23.
The decrease in the second year is due to anticipated spending capital projects planned for FY 2021-22. These include projects through the Water Fund that build infrastructure to improve the delivery of water services in the City.
City Council will discuss the proposed budget in next Tuesday’s meeting, request any additional changes, and are expected to approve it by the end of open session.
The proposed budget breakdowns for the Santa Monica Pier Corporation and Santa Monica Travel and Tourism are also on the consent calendar for the meeting.
The Pier’s annual budget of $790,000 is much smaller than in years passed and includes no allocation for pier produced programming including the Twilight Concert Series. Santa Monica Travel and Tourism prosed a $4.42 million annual budget with a focus on using tourism to expedite the City’s economic recovery.
The staff report and full budget is available on the agenda, which also details how community members can sign up for public comment. The meeting will begin at 5:30 p.m. and the agenda can be accessed at https://tinyurl.com/CityCouncilJune22.