Home News Proposed FY 16 City Budget ‘Lean’ And ‘Living Within Our Means’

Proposed FY 16 City Budget ‘Lean’ And ‘Living Within Our Means’

Stressing that the upcoming city budget is a collaborative effort involving the community, staff and elected officials, Mayor Robert Garcia released the proposed $2.7 billion,­­ 2015-16 Fiscal Year (FY) budget at a July 28 press conference. He even had a theme for the budget: “Creating A More Livable City.”

“The budget was not operated in a staff vacuum,” Garcia said, “but it really is a product of lots of input [from the] community that we’ve heard throughout the year on a variety of issues; discussions at the city council; and of course initiatives that I have laid out this last year as mayor.”

This marks Garcia’s first budget that he can claim full “ownership” of. When he came into office in July 2014, the proposed budget had been prepared, with much of the input coming from former Mayor Bob Foster. That budget (the current 2014-15 FY) had been forecasted for a slight deficit but is now projected to show a $600,000 surplus when the fiscal year ends on September 30. That, according to City Manager Pat West, is a result of higher than projected revenues.

Garcia referred to the new budget as “lean” and forcing the city to “live within our means.” The pressure point on whether that is possible may depend on how current and future negotiations go with the city’s unions.

“We all know that the last few years have been tough when it comes to ensuring that we have a responsible budget,” he said, “and in spite of that rough patch that we hit, as a city, and financially as a country, we all began to recover out of that. We all know that oil revenue is still down and this budget anticipates that [oil revenue is pegged at $55 a barrel, down from $70 in the current budget year]. This budget really focuses on a path to fiscal prudence. As we move forward, we must absolutely remain cautious, continue our conservative budgeting, and most importantly make the investments that we can in a way that’s modest and that can really support the programs that are important to the city. ”

Garcia said the community can expect to see some “small investments in areas that I think will make everyone’s life better, particularly residents.” He added, “One of the things that we are extremely committed to is making sure that we have neighborhoods that are strong and an education system that is strong and that we are investing in the future.”

Toward that end, he said the city will return a staff position that had been eliminated two years ago: a coordinator for the preschool/early childhood education community.

“We’re now bringing back someone to manage and work with our education and preschool community to expand universal preschool in Long Beach which has been a goal of mine since coming into office, and I know the council is committed to that as well,” Garcia stated.

He announced the creation of what he called “two dedicated clean teams” that will move throughout the city picking up trash that is dumped, cleaning up graffiti, removing weeds, etc., that is in addition to the work already being done by city crews.

The mayor also said that he is proposing to bring back some Sunday hours to three city libraries, to add welcome signage across the city and, in a move that will elate residents who live in parking impacted areas, implement “the largest parking and street sweeping reform this city has had in 30 years.”

The tech-savvy mayor said that money has been set aside to transition the city to a single phone number. . . . “some type of 311 or one single number for Long Beach system that will ease the ability for residents to communicate with the city. So they can call one number and be able to reach any service they want.”

Garcia discussed several other items related to public safety, education and economic development. To read the mayor’s budget recommendations, visit: http://www.longbeach.gov/Finance/Media-Library/Documents/City-Budget-and-Finances/Budget/Budget-Documents/FY-16-Mayor-s-Budget-Recommendations/.

General Fund Budget

City Manager West also addressed the media during the press conference, focusing on the $412 million General Fund portion of the proposed city budget. This is the fund that pays for most city services. West noted that public safety makes up 69 percent of general fund dollars. He added that part of that money is for “additional police overtime to patrol, suppress, investigate and prosecute for violent crimes.”

West also said there’s going to be a continued focus on “critical” infrastructure, indicating the city plans to spend nearly $10 million on local streets and sidewalks. “You’re going to see about $5 million in residential street programs, $3 million in our sidewalk program, $950,000 one-time for local streets and sidewalk repair, and another $1 million of one-time money for sidewalk study and plans to repair our sidewalks of our 52 square miles,” West said. “In addition to that, there’s $11.5 million for major and secondary streets outside of our residential neighborhoods. You’re going to see continued improvements for parks and recreation, transportation enhancements and public facilities.”

A major shift in operations is to move the Pacific Gateway Workforce Investment Network, currently under the city’s human resources department, to the new economic development department. Pacific Gateway has successfully worked with businesses to provide qualified workers, saving businesses time and money. The Network offers training, business assistance, workshops, job fairs and much more.

Without going into detail, the city manager said the budget includes funds for investments in innovation and to transform Long Beach City College’s Small Business Center on Pine Avenue into an innovation center. He went on to briefly discuss a few dozen new, continued and enhanced programs that are part of the proposed budget.

But he also discussed the challenges ahead, as “expenses are likely to outpace revenue growth for the foreseeable future,” including a projected 2017 deficit of at least $7.5 million, rising to $7.8 million in 2018. Much of this a result of pension costs.

According to the city, the current estimated cost of unfunded liabilities is $1.2 billion, with $834 million for CalPERS (California Public Employees’ Retirement System). The budget document includes the following sentence: “It is projected that the annual projected increase in pension costs for the general fund will reach $25.7 million by FY 20.”

Additionally, the document addresses challenges from pending employee union contracts (the city has nine unions it negotiates with): “Expiring employee agreements, whose renewals are not reflected in projections for FY 16 and beyond could increase deficit amounts if offsets are not identified.”

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