While the City and its staff are still recovering from the sting of 2020’s pandemic-induced budget cuts, short-term financial news continues to be positive with year-end revenues exceeding projections by $20 million.
In an upcoming Oct. 26 meeting, City Councilmembers will discuss the fiscal year 2020 to 2021 year-end budget report and what will be done with the unanticipated additional funds. Council will also introduce a mandate that would require all Santa Monica properties to recycle organic materials and will adopt historic property preservation agreements with six new properties.
Year-end budget review
According to the staff report, the increased revenues were a result of “the strong housing market; exceptionally vigorous consumer activity once shelter-in-place restrictions were lifted, resulting in higher than anticipated sales, hotel tax and parking receipts; and the positive impact of the recently passed Measure SM Real Property Transfer Tax increase.”
This increase in funds will not translate into an immediate expansion of City services, but it does mean that the general fund will no longer require the use of the $20 million Shutdown Reserve to maintain a balanced budget in FY 20 to 21.
The $20 million represents a small portion of the City’s overall $613.6 million operating budget for FY 20 to 21. This year’s budget was reduced by 25 percent compared the operating budget in pre-pandemic years.
The year-end report allows the City to make minimal but time sensitive changes to the budget. Staff will return in February with a more robust presentation on the state of the City’s finances, which will include a five year forecast and assessment of the City’s progress towards economic recovery.
Organic waste recycling mandate
Also on the agenda is the first reading of a new ordinance that would make it mandatory for all property owners, residents, and commercial businesses to recycle their organic waste. This ordinance was drafted to bring the City into compliance with Senate Bill 1383 and to help the City reach its 2030 zero waste goal of reducing the per capita landfill disposal rate to 1.1 pounds of landfilled waste per person per day.
The ordinance contains several elements to meet this goal. All residents and businesses must be provided with a green (organics recycling) container. Certain commercial edible food generators will be required to recover edible food leftovers, package them for reuse and donate to a food recovery organization. Education and outreach will be provided to organic waste generators and monitoring will be conducted to ensure compliance with the ordinance.
Historic preservation
Council is also expected to approve Mills Act contracts with six properties in Santa Monica to aid in its historic preservation efforts. The Mills Act is part of California’s Government Code and authorizes property tax reductions to owners of historic properties to incentivize their long-term preservation.
The City currently has 90 properties registered with the Mills Act and will be adding five residential-multi family properties and the Georgian Hotel.
The Georgian Hotel was constructed on Ocean Avenue in 1930 utilizing a blend of Romanesque Revival and Art Deco architectural styles. Rehabilitation efforts are planned with an estimated price tag of $3 million. The Mills Act designation will assist the owners in financing this.
The City Council meeting will begin in closed session at 5:30 p.m. on Oct. 26 and can be streamed live at www.youtube.com/user/Citytv16santamonica.
Clara@smdp.com
