Goleta projects a $1.1 million deficit

By JOSHUA MOLINA — May 20, 2009

Amid a deepening nationwide recession and major fiscal problems across California, the city of Goleta was hit with its own blow of major bad news on Tuesday.

Goleta is projecting a $1.1 million budget deficit out of its $14.1 million proposed general fund. The shortfall may result in employee layoffs, work furloughs and even reduced library hours.

The Goleta City Council wrestled with the grim scenario at Tuesday’s council meeting.

“This is not the greatest thing to look at,” said council member Margaret Connell. “This is the first year that I am aware of that producing a balanced budget is really difficult.”

Just how deep the cuts will slice is still a mystery. The council plans another meeting next Tuesday to plunge deeper into possible scenarios for balancing its spending plan for the 2010 fiscal year.

Also on the table is discussion of raising the sales and hotel bed taxes, and imposing a new tax on business licenses. The council may freeze merit raises and offer incentives for senior employees to retire.

City leaders are also considering an additional parcel tax to raise revenues to operate the Goleta library.

Much of the projected deficit can be blamed on major drops in revenues from hotel bed tax, vehicle license fees, building permits and plan check fees. But Goleta is also reeling from a projected $355,000 increase in its contract with the county to provide law enforcement services for the city, which incorporated in 2002.

The Sheriff’s contract has ballooned largely because of an increase in overhead and administrative costs that the city has little control over; the only area Goleta can make cuts is in the actual number of personnel that it pays for.

Goleta currently pays for the roughly 35 positions. The council on Tuesday discussed eliminating on gang enforcement officer – shifting those duties to a city community resource officer. The council also batted around the idea of reducing one of the four detectives that it contracts for, but that idea was met with resistance largely because detectives essentially work in pairs.

Goleta is not the only city on the South Coast grappling with severe budget problems. Its more seasoned sister to the north, Santa Barbara, is projecting a whopping $10.5 million budget deficit next year and layoffs are also a possibility.

How Goleta will pull itself out of the dire situation remains to be seen.

“We will go over this line by line,” said Goleta Mayor Roger Aceves. “We are going to have to make a decision.”

 Their fiscal problems are complicated by the fact that Goleta is simultaneously considering building a new City Hall building. Right now, the city leases space at a business park on Cremona Drive. But city staff members want the council to spend about 14 million on a new building off Hollister.

After one year, Goleta expects to start saving money on its investment. Goleta would lease out about half of the 40,000 square foot building. If it moves ahead with the plan, the city would take about $7 million out of its reserve funds, and sell about $7 million in bonds to pay for the rest.

But the Goleta council will have to convince voters that it’s a wise time to make such a dramatic investment infrastructure – at a time when the city may make layoffs.

Such a decision might not sit well with Goleta library patrons, who are concerned about reduced library hours, the possibility of closing altogether on Mondays, or even contracting with the private sector to run the library; Goleta currently contracts with the city of Santa Barbara to operate its library.

Although City Manager Dan Singer said having a private company run the library is unlikely, many residents have concerns.

“From Halliburton in Iraq to private management of jails, the argument that the private sector is less prone to waste, fraud and abuse has turned out to be a myth,” wrote Corinne Horowitz, president of the Friends of the Goleta Library, in a letter to the council. “In addition, these private initiatives have often put our most basic values at risk.”

In other council action on Tuesday:

In what was largely a formality, the council approved the 101-unit condominium project known as Haskell’s Landing in the city's western end. The project, on the northwestern corner of the Hollister Avenue and Las Armas Road intersection, would sit on 14.5 acres, which is currently vacant open space.

Goleta City Manager Time Giles announced at the end of Tuesday’s meeting that the city on Monday had been served with a lawsuit from Rancho Mobile Home Park Homeowners Association, over the council’s approval earlier this year of an overhaul of the Hollister Park, essentially turning the rent-controlled property into for-sale units. Giles said no further details were available and that the city would need the next few days to review the lawsuit.

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: 5/20/2009

Hows them affordable housing, WIC, healthcare handouts workin out for ya Goleta?

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: 5/20/2009

Oh, yeah, like that's all to blame. The aforementioned benefits are subsidized by the State and Feds.

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: 5/21/2009

The "City of Goleta" has created a bloated bureaucracy in under a decade! This is NOT why I voted for local control. If I could take back my cityhood vote, I would. Dump the sign police, the paint police, etc. You have entire divisions building empires and creating work. We've had it with all levels of bloated government. Do the essentials, and do them efficiently, and quit trying to micromanage stuff that is none of your business.

goleta native

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: 5/24/2009

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BUDGET NEEDS : 5/24/2009

REPEAL MOBILEHOME PARK RENT CONTROL AND SIMILAR BUREACRATIC NIGHTMARES. IT WOULD SAVE HUNDREDS OF THOUSANDS OF DOLLARS AND WOULD FIX THE NEWEST LAWSUIT FROM TENANTS VERY QUICKLY.

INTERESTED OBSERVER

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