January 27, 2021 10:17 AM
At its meeting last night, the Santa Monica City Council received an update on the City’s financial health as the COVID-19 pandemic continues to take a devastating toll on the US economy. The City’s budget remains balanced through prudent departmental spending and by leveraging $14.6 million of the $20 million Shutdown Reserve fund after City revenues were lower than anticipated as a result of the extended winter COVID-19 closures. The Shutdown Reserve was created for this very need during the June 2020 budget adoption when the organization was restructured to close a deficit projected at that time to be $224 million.
“The pandemic’s impact to City revenues that support community services has been catastrophic, yet the budget continues to reflect our values. It is balanced and we continue to find ways to do more in the areas of greatest need, including homelessness, customer service, and eviction support,” said Mayor Sue Himmelrich. “The greatest opportunity to do more for those in greatest need and to fill gaps in revenues is through federal stimulus which has been severely limited to date. We are hopeful this will change under President Biden’s proposal and we are voicing that to our representatives at every possible moment.”
Even with further diminished revenues, the Midyear Budget includes investments in enhanced community services created through five vacant police officer positions that will be eliminated in keeping with Council’s direction to ensure future changes to the City budget equitably impact each department. The vacant positions will support areas of greatest need:
- Additional resources to address homelessness
- Enhance Code Enforcement services to address quality of life concerns
- Improve customer service for residents and addressing non-emergency calls by offering a 3-1-1 line
- Provide eviction counseling to assist tenants who face losing their homes due to rent unpaid during the pandemic
- Fund the inspector general position that will support the newly formed Public Safety Reform and Oversight Commission
- Additional Library page hours to support curbside service
Given reduced revenues which are anticipated to be $11.6 million lower than initially projects for 2021 – 2022, the Council approved new potential revenue opportunities to be executed with community appropriateness and neighborhood character in mind, including taking the next steps to implement a digital wayfinding program that could generate an estimated $2 million from advertising revenue a year. Additionally, Council directed staff to return with a future proposal exploring sponsorship and naming rights opportunities akin to Hulu’s sponsorship of Breeze Bike Share or the Annenberg Community Beach House.
Council voted to extend the Human Services Grant Program and Organizational Support Program for two years and stipulated that any new monies that come into the City will be provided to new grantees focused on providing mental health and homelessness services.
The biennial budget process will kick off next month with a community survey followed by a City Council session on budget priorities for the FY 2021 – 2023 budget in the context of the limited resource available due to COVID-19. The budget will be adopted in June.
The City Council also voted to create an application process for the We Are Fund Advisory Board to determine how to invest in-kind donations made through the We Are Santa Monica Fund, which to date has raised $1.15 million. The board will determine allocations to support COVID-19 recovery for residents and businesses, along with other community needs determined by the Board.