Goleta Faces Tricky Budget Balancing Act

Santa Barbara Newsroom
By Tom Schultz
May 29, 2007

Looking ahead to the next two financial cycles, Goleta officials face a raft of potentially tricky decisions as they work to keep the city's operating budgets in the black.

Tax income and other revenues would exceed City Hall expenditures in fiscal year 2007-08, according to preliminary projections, but would fall short of covering costs in 2008-09.

Goleta has maintained a balanced budget since its 2002 incorporation, and council members during a recent workshop did not appear ready to let that record of success slip away in the coming weeks, as they work to finalize spending plans for the next two fiscal years before June 30.

Councilwoman Jonny Wallis said she was particularly concerned about "a dramatic increase" in expenditures over those posted during the current fiscal year, particularly in light of a small 1 percent city revenue increase projected for 2007-08 and similarly modest 1.2 percent revenue increase expected in 2008-09.

For example, "We are showing in our services and supplies budget by department and program a more than 37 percent increase" in spending, Wallis noted.

Among its looming expenses, the city in 2008-09 anticipates a $165,000 bump in cost of living adjustments to wages over current levels, a one-time $200,000 bill for the creation of zoning codes and a nearly $334,000 increase in law enforcement costs over current levels.

"Deficits are not acceptable," Councilman Eric Onnen said, suggesting the city should carefully shape its expectations. "We have to look at all those areas where we have opportunities to adjust our expenditures."

"We are going to have a very skinny budget in the best of circumstances, and we could go negative very quickly," he said.

BY THE NUMBERS

Goleta would take in $15.41 million and spend $15.3 million in 2007-08. The following 12-month cycle, the city would collect $15.6 million and spend $15.72 million. Goleta currently operates on a more than $14.3 million spending plan, with about $14.7 million in revenues.

For the first time, Goleta is planning two years into the future — a change that brings more work but allows the city more flexibility in timing the start or completion of projects. The shift also enables City Hall to more easily carry money over from one year to the next, City Manager Dan Singer said.

"There are organizations that say they have a two year budget and every year they adopt a two year budget, which really just makes the second year a projection," Singer said, adding Goleta instead would fully appropriate money over a 24-month period, while at the same time allowing for adjustments down the line. "It will require our department managers and our staff to be more careful and diligent in spending money, so that not too much of it is spent up front."

Complicating the task of planning for the next two fiscal years are requests across the next two fiscal years that currently remain unfunded in the preliminary budget. Among these are $128,000 for a community resources deputy for law enforcement, $111,000 for a new motorcycle officer, $100,000 for recreational services, $20,000 for a festival in Old Town and $9,000 to record and broadcast Design Review Board meetings on television.

In addition, outside organizations including Girsh Park, the Goleta Valley Historical Society, Goleta Valley Beautiful, the American Red Cross, the Goleta Valley Chamber of Commerce and other groups seek a combined $470,000 in grants for various projects over the next two fiscal years.

"Some of these unfunded items we would highly recommend funding, but then it's a matter of, "Where do you get the money to do it?" Singer said.

PLAYING IT SAFE

Goleta's largest expense is its more than $5 million annual contract for law enforcement services with the Santa Barbara County Sheriff's Department. Negotiations are underway to frame that contract for the next five years, and the public will have its first chance to comment on the draft document Monday.

Money for the unfunded community resources deputy, who would work with residents to tackle community problems, could come from a donation from Camino Real Marketplace. The shopping center has proposed giving the city space for a Sheriff's Department operations base plus $100,000 in each of the next five years to help with the cost of law enforcement.

While Singer said the center would benefit from added visibility of law enforcement there and shortened response times to the property in the event of an emergency, Councilwoman Jonny Wallis said she was concerned about the perception that the marketplace was reducing its private security force and in essence buying the use of public law enforcement.

Mr. Singer said that was not the case. "The personnel there and the $100,000 is not meant to require the Sheriff's Department to do foot patrol, or patrol the Camino Real Marketplace."

Sheriff's Lt. Chris Pappas, Goleta police chief, compared the proposed base to the Sheriff's Department headquarters, stating that the area around it does not receive special attention.

As the budget talks unfold, watch for newly-elected Councilmen Onnen, Michael Bennett and Roger Aceves to increasingly criticize a deal that they say unfairly sucks money away from the city.

All three promised during last year's bruising council election campaign to renegotiate the terms of a revenue-sharing agreement in which Goleta sends half its sales, property and other tax income to Santa Barbara County. The new councilmen say the contribution, negotiated with the county shortly before the city formed, is far too steep.

Bennett and Onnen said recently that the city should note the situation prominently in its budgets.

"It would be very helpful so that everyone understands the impact, number one, of the county doing what they are doing to us," Bennett said.

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