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Malibu’s 2021-22 budget is a bit rosier than originally presented, thanks to the expected lifting of crushing COVID-19 restrictions and full “reopening” of the state economy by Gov. Gavin Newsom in about three weeks.
The financial pact before the City Council today totals $81.58 million in revenue and $90.89 million in expenses. Included is General Fund revenue of $34.56 million and annual expenditures for ongoing city operations of $39.89 million.
“Dining and travel restrictions imposed by the public health orders have had the greatest impacts as restaurants have historically been the primary contributor to the city’s sales tax revenue,” Lisa Soghor, assistant city manager wrote in a budget report. “While General Fund revenue is trending higher than previously predicted … overall revenues are still less than anticipated and are significantly less than the City’s ongoing expenses for Fiscal Year 2021- 2022.”
The economic effects of the pandemic, Soghor said, “have negatively impacted many local revenue sources, including sales tax, transient occupancy tax for hotels and motels, gas tax and parking tax during the past year.”
Since the council got a first look a month ago, the budget has undergone revisions that:
Maintain Council Work Plan priorities as follows: Public Safety, Woolsey Fire Recovery and School District Separation
Fund two additional Los Angeles County Sheriff’s Department patrol units ($1.09 million)
Spend $50,000 for consultants to address commercial property Dark Sky Ordinance compliance
Works to find new revenue sources and provide direction to staff rebuilding effort from the Building Safety Division and Planning, Environmental Sustainability and Public Works departments.
City staff projects a $1.46 million increase in General Fund revenue, while property tax revenue for the fiscal year is now $12 million.
In all, city staff has increased the estimated revenue in the proposed budget by $300,000 to $12.20 million.
The bed tax, aka transient occupancy tax is now projected to be $4 million based on 3 quarters of tax revenue. The new hosted short-term rental ordinance has resulted in a projected increase of $600,000 to $2.50 million. As more people spend money around town, staff has also increased sales tax revenue projections by $450,000 to $3.20 million.
“A key factor to Malibu’s fiscal recovery has been that, unlike many cities, the city’s main general fund revenue is derived from property tax,” according to the Soghor report.
“Property tax comprises approximately 43 percent of General Fund revenue that, even in the aftermath of the Woolsey Fire and the loss of 488 single family residences, remains strong and steady.”
The meeting will be streamed live at 6:30 p.m. at malibucity.org.