The City Council last week unanimously approved the budget for 2019-20.
Avalon city staff projected operating expenditures of $28,502,483.
Avalon city staff projected operating revenues of $28,619,783.
At the June 18 council meeting, Avalon Finance Director Matthew Baker said staff had presented the council with a balanced budget. However, he said the budget had been balanced by drawing on city funds. He said operating expenditures are outpacing revenue growth. He said the city needed to start looking at increasing revenues or changing service levels.
Baker said staff would come back in July to discuss additional opportunities for revenue.
Members of the public and the council applauded when Baker was done with his presentation.
Mayor Anni Marshall said she didn’t take a breath turning the presentation.
Council Member Cinde MacGugan Cassidy said it was the easiest and most well put together budget she had seen. This was her fifth.
Some officials’ takeaways
The Islander asked some city officials for their number-one takeaway from the budget process.
“The operating budget as a whole is balanced with draws on fund balances required to finance significant capital projects,” said Baker in an email to the Islander.
The 2019-20 city budget defines capital improvement projects as “multi-year commitments by the City to construct new facilities and infrastructure, make improvements to existing facilities and infrastructure, and to purchase and replace large vehicles and equipment.”
Finance director Baker said, “My takeaway on the budget would be that increases to operating expendi-tures are outpacing revenue growth, particularly in the Enterprise funds (e.g. business-like funds, Sewer, Saltwater, Transit, etc.), and that new or increased revenues are required to maintain the existing level of service to the Community without future draws on fund balance.”
Council Member Oley Olsen said, “We continue to spend revenues.”
He said that can’t go on forever.
He said the city hasn’t addressed lost revenues.
Addressing the issue of declining visitors, Olsen said, “I think the product is getting better.”
He said it would help when the Atwater and the Zane Grey hotels re-open. (The Atwater is expected to re-open in August, according to the hotel’s website.)
As to the cost of traveling to Catalina, Olsen said, “As long as there’s value, it’s not overpriced.”
He said he was optimistic.
Mayor Marshall said that staff did their due diligence. “There was no fluff in the budget,” she said.
She said staff projections indicated that tourist dollars and hotel tax would be static compared with last year.
She said in the next month or two the council was going to be looking at ways to increase revenues for the city. That would be “an interesting discussion,” according to Marshall.
