Santa Cruz CA – City Manager Martín Bernal released the City of Santa Cruz’ Proposed Fiscal Year 2014 Budget to the City Council today in advance of budget hearings on June 10-11. The FY 2014 Proposed Budget presents a cautiously optimistic outlook on the City’s financial standing, and proposes strategic investments in City Council priorities, specifically public safety and critical infrastructure needs. The Budget is available on the City’s website at www.cityofsantacruz.com/2014proposedbudget
The City is projected to achieve a budget surplus of $1.5 million by the end of FY 2013, due in large part to the resilience of the local economy, the City’s conservative fiscal approach and prior significant reductions in expenditures and employee compensation. Sales tax receipts, hotel visits and other revenues are up this year, and signs of a continually improving economy point to a broader economic recovery.
“Despite the slow emergence from the Great Recession, we expect to complete the current fiscal year with a General Fund surplus and maintain a AA+ bond rating,” Bernal said. “This is a testament to the financial restraint of the City Council and the talent, creativity and sacrifice of City employees.”
Although the City’s financial position is strengthening, Mr. Bernal and Finance Director Marcus Pimentel are cautious in their outlook for the coming fiscal year (FY 2014) due to pending city liabilities. Mr. Bernal’s budget message to the City Council identifies several liabilities on the City’s radar, including a $1 million claim brought by a property owner near Branciforte Road, increases in employee health care and retirement costs and the State’s continued attempt to claw back funding held by the City’s former Redevelopment Agency.
To balance these issues with a brightening local economic forecast, the FY 2014 Proposed Budget of $193 million ($77.8 million in General Fund) calls for strategic investments in the City’s infrastructure, public safety programs, and its employees.
Of particular note, the FY 2014 Proposed Budget recommends spending an additional $2.1 million in City roads, bridges and parks improvements compared to last year to address deferred capital needs. Staff will also develop a debt strategy to take advantage of historically low interest rates to explore issuing capital investment bonds in calendar year 2014.
“This budget is both optimistic and realistic about our future,” Mr. Bernal says. “We’ve continued to see the local economy recover, and with it, the locally generated tax receipts that support our police, parks and public works efforts. We will face many challenges in the coming year, but I think that the City is on firm financial footing. It’s time to strategically invest in our community.”