After bracing for a financial drought at the outset of the pandemic, the City is now experiencing a light windfall in revenue thanks to a speedier than expected economic recovery.
With an additional $30.7 million in General Fund revenue expected for this fiscal year, City Council is slated to discuss adjustments to the mid-year budget in a Feb. 8 meeting.
The staff report recommends allocating funding for additional full and part-time staff hours that total to the equivalent of 32.1 full-time positions spread across the City’s departments. The plan also allocates funding towards parks and recreation programming, housing resources and library services.
The increase in funding is thanks to the rebounding of tourism, retail and parking revenues. The City projects receiving an additional $9.2 million in sales tax revenue, $13.6 million in hotel tax revenue and $3 million in parking related revenue.
Despite these promising signs, the City still continues to feel the sting of COVID related revenue losses. Updated projections estimate General Fund revenue loss to total approximately $188 million from March 2020 through June 30, 2022. Additionally, the nature of Santa Monica’s economy may lead to an extended overall recovery.
“While the City is experiencing recovery, its reliance on the strength of the severely impacted hospitality sector means that ultimate revenue recovery and rebuilding from the deep cuts that were made will lag behind the recovery of the overall economy,” states the staff report.
In order to assist with the resumption of City services, staff are currently researching potential revenue raising ballot measures.
In May 2020, the City eliminated around 300 permanent and 122 temporary positions in response to COVID related revenue losses. The updated FY 21-22 budget reflects an increase of over 26 permanent positions and 30 temporary positions spread between initial rehires and rehires as a result of mid-year budget adjustments.
Specific hiring changes in the mid-year budget revisions will support a range of City priorities.
The budget proposes hiring one literacy program assistant, two part-time library services officers and reopening the Fairview Library Branch. The Community Services Department is slated to receive a program supervisor, staff assistant and 607 as needed hours to increase its sports programming, community leagues, classes and tournaments. Money is also allocated to improve security at Virginia Avenue Park.
Public Works, the Department of Transportation and the Police Department are expected to receive additional staffing equivalent to around two full-time positions each. Human Resources, the City Manager’s Office, City Attorney’s Office, and Information Services will also see staffing boosts.
City Councilmembers will discuss and vote upon the proposed budget changes during Tuesday night’s meeting. The meeting will begin in closed session at 5:30 p.m. and can be viewed live at youtube.com/user/Citytv16santamonica.