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Laguna Beach


Budget workshop set for 3 p.m. today; Regular meeting set to begin at 5:30 p.m.

By BARBARA DIAMOND

A budget workshop will be held from 3 to 5 p.m. today, Tuesday, June 23.

City staff will make a presentation and answer questions about the revisions to the previously approved 2020-2021 budget, necessitated by the impacts of the COVID-19 pandemic. The council will have an opportunity to hear from the public and provide direction to City Manager John Pietig before adoption of the revised budget, scheduled for June 30.

“We do not yet know the full impact this pandemic will have on our city and its finances, and while we remain optimistic that Laguna Beach will recover, no one knows how deep the pending economic downturn will be or how long it will last,” Pietig informed the council by letter. 

“Our priorities are to protect and preserve the health and safety of Laguna Beach residents, maintain prudent fiscal reserves, and provide as many services as possible.”

As expected, the revised budget is affected by the loss of revenue due to the pandemic and must be compensated for by cuts in expenditures, according to the proposed budget prepared by Pietig and Director of Administrative Services Gavin Curran. 

“We started right after the April 7 council meeting,” said Curran. 

Some requests from the council at that meeting have been included in the proposed budget. 

The main feature is the estimated reduction in revenue from $111.7 million to $93.7 million. The biggest hits are in the Transient Occupancy Tax, the Business Improvement District, and sales taxes – a combined drop of probably $11 million, with $7.1 in the General Fund. 

The reductions are due to the significant and sudden decrease in the travel and tourism industry, as people began staying at home to help prevent the spread of the virus. 

Consumer spending also has suffered, due to job or salary losses. 

Decreases in revenue are expected in community development services and recreational programs. 

Pietig is proposing a budget that does not include any layoffs or furloughing other than reductions in recreation and transit services approved by the council in May. Staffing will be decreased by the elimination of vacated positions and consolidation of some recreation and pool services into the Public Works Department. 

These savings are in addition to the Municipal Employees’ Association forgoing a negotiated 2.5 percent pay increase that was to go into effect on July 1. Management typically follows. 

“I very much appreciate our employees’ cooperation and understanding in these difficult times,” said Pietig. “Their efforts are very helpful in minimizing reductions in services and preventing layoffs.”

The scheduled 2.5 percent salary increase for the Police Employees’ Association, set to start January 1, has not been removed from the proposed budget but may be revisited in the fall, depending on the financial situation at that time. 

To avoid further cuts in the budget that would require reductions in services and the layoff of employees, Pietig is suggesting the council tap the $13.2 million General Fund Reserve for $1.5 million. Four affirmative council votes are required to reduce the reserve below 10 percent. Other proposed General Fund modifications include a $1.8 million reduction in contact services, health care, overtime, travel, and dues.

On the brighter side, the notoriously frugal Pietig expects property taxes, the source of 56 percent of the General Fund revenue, to be relatively unchanged and the 10 percent Disaster Reserve Fund to remain intact. 

The proposed budget and meeting agenda is available for review on the city’s website at www.lagunabeachcity.net/cityhall/citygov/
cityclerk/mam.htm
.

The public may participate in the meeting via Zoom by calling (669) 900-900-9128 (the Webinar ID is 93657705035#) or clicking here.

The meeting may also be viewed live on Cox cable channel 852 and online on the City of Laguna Beach website at www.lagunabeachcity.net/agendas

The public may submit comments on any agenda item or on any item not on the agenda in writing via mail to the City Clerk at: 505 Forest Ave, Laguna Beach, CA 92651, by email to This email address is being protected from spambots. You need JavaScript enabled to view it., or by using this interactive form: www.lagunabeachcity.net/comment.

 

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In Memoriam - Stu Saffer and Barbara Diamond.

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