National Economy Gross Domestic Product up 4.2% Unemployment Rate is dropping - new jobs coming on line in 2004 Energy costs continue to climb Inflation creeping up
State Economy Unemployment rate decreasing Jobs being created Consumer prices still stable Overall tourism rates increasing Energy prices rising
State Uncertainties Governor proposes to reduce State revenues to cities by $350 million for the next two years. Santa Monica’s share: $3.5 – $3.8 million Effects of revenue “triple flip” reduce financial flexibility No long-term solution to the State budget deficit per State Legislative Analyst
Local Economy Retail Sales on the upswing Sales Taxes for fourth quarter 2003 up 6.7% over prior year fourth quarter Tourism Improving Hotel Occupancy up 9.12% in the first quarter as compared to same quarter last year Home Sales Strong Assessed Property Valuation up 7.6% from FY2002/03
Local Revenues *Sales tax does not include “Triple Flip” ** TOT includes a 2% increase in rate effective 1/1/05
City of Santa Monica Proposed Budget All Funds: FY2004/05 – $376.9 million FY2005/06 – $369.2 million
Revenue Measures New Revenues: $1.4 million Ambulance Service Fees: $0.9 m. Recreation & Facility Use Fees: $0.4 m. Valet & Preferential Parking Fees: $0.1 m. Transient Occupancy Tax: $3.5 million Increase from 12% to 14% effective 1/1/05 FY2004/05: $1.6 m. FY2005/06: $3.5 m. (full year) Reimbursements – $2.4 million
Expenditure Reductions Programs Landscape Maintenance Services CCS – Program hours & Community Grant reductions CIP Projects $3.6 million Personnel Reorganizations & redeployment of personnel in EPWM, CCS and Library – Six full-time positions cut – No layoffs Vacant civilian Police position eliminated (4) Selective hiring controls in all departments for salary savings
Major Budget Enhancements Virginia Avenue Park: $200,000 Skate Park: $51,074 Additional Park Ranger Coverage: $18,382 Virginia Avenue Park & Skate Park Community Classes: $112,000 Parking Operations: $104,912
Fund Balance Loans to Cemetery & Airport: $3.2 m. As-Needed Employee Conversion: $0.3 m. Permit, Plan Check, Inspection & Code Enforcement Improvements: $0.5 m. Destination Promotion: $0.5 m. Worker Compensation Contribution: $5.0 m. State Funding Uncertainties: $4.2 m. 10% Reserve: $18.1 m.
Changes for FY2005/06 Plan Virginia Avenue Park full year funding Community & Cultural Services – Virginia Avenue Park Creative Partnership Programs Additional Park Ranger coverage Main Library opening (partial year)
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