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City of Santa Maria to re-evaluate budget priorities amid coronavirus impacts

City of Santa Maria to re-evaluate budget priorities amid coronavirus impacts

As Santa Maria city officials build their 2020-22 budget, economic downturns anticipated from the coronavirus are forcing staff to re-evaluate funding allocations and priorities they have placed on ongoing projects. 

Due to a county order that curtains the city's revenue, City Manager Jason Stilwell said staff will have to alter the budget to account for decreased funding needed to cover various operations costs.

The Santa Barbara County Public Health Department on Tuesday instructed all bars, pubs and wineries in the county to close, with all restaurants with in-house dining to limit their services to takeout and delivery. 

"We do anticipate a downtown. Most of our revenue is driven by consumer sentiment, and sales tax and hotel tax primarily," Stilwell told the City Council on Tuesday. 

In particular, the city is expected to suffer from a loss of Measure U revenue as consumer purchases go down, city spokesman Mark van de Kamp said. 

"Sales tax is the lifeblood of Santa Maria's budget, followed by property tax. With anticipated fewer purchases, that translates into fewer funds for the city's operations. As the economy goes, so does the city," van de Kamp said. 

Although staff can expect downturns locally and statewide, slow turnaround on revenue reports and unemployment rates from the state means the city does not receive revenue specific data in real time, making it difficult to make fully informed budget revisions.

"[City] departments have already submitted their proposals and those are being evaluated now. We are now re-evaluating our revenue projections, but we don't have any actual numbers in. It will take some time for the state of California to react and calculate what the revenue downturn is," van de Kamp said.

Along with department proposal submissions, city staff have begun to form the upcoming budget around priorities established at a goal setting workshop in February.

City staff and residents established financial stability as an overarching priority, and highlighted five top priorities including affordable housing projects and special needs projects, streamlining business permits, providing recommendations for the Mayor’s Task Force on Youth Safety, finalizing the Downtown Specific Plan, and working to make permit processing and permitting more efficient. 

Stilwell presented these priorities to the City Council for approval on Tuesday, with the caveat that updated revenue assumptions could require staff to restructure the budget from what was possible in February. 

"The budget will be tougher than we thought it would be a month ago," he said. 

Stilwell said the overall goal is to develop a balanced budget that can be adopted by the council. He said the staff has options, between scrambling to overhaul the budget prior to presenting it to the council in the summer, or developing a budget that can be adjusted in 2021.

On Wednesday, the city declared a state of emergency, allowing officials to access state funding for coronavirus response resources even as regular revenue goes down.  

Laura Place covers city government for the Santa Maria Times.


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Santa Maria City Reporter

Originally from the Pacific Northwest, Laura Place covers city government, policy and elections in Santa Maria and Santa Barbara County. Follow her on Twitter @itslaurasplace

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