The final version of the 2024-25 budget will come to the Avalon City Council on Tuesday, June 18. The proposed budget for the city as a whole increased 6.1%, according to Finance Director Matt Baker.
He presented the council with a draft—repeat, draft—of the budget at the June 4 meeting. Remember that all numbers are subject to change. A copy of the draft is available on the city website.
The proposed budget is for $65.75 million, according to the introduction at the start of the draft budget. That includes $25.21 million for capital outlays.
“Avalon has made significant strides over the last three fiscal years in re-building its reserves and restoring the levels of services from the cuts made in response to the pandemic. Reinvesting in community needs such as public safety, infrastructure improvements emphasizing climate resiliency, and active transportation improvements are the direct result of Council’s direction and a reflection of their priorities,” according to the introduction.
On June 4, Baker told the council that Avalon had $24 million capital spending in last year’s budget and by the year-to-date the city had spent less than $4 million on capital projects.
He said close to $24 million would be rolled into the 2024-25 budget.
The operating revenues in the General Fund are budgeted at $12.8 million (rounded), according to a slide Baker showed to the council. The same slide put the operating expenditures at $12.4 million (again, rounded). The proposed budget appeared at the time to project a surplus of $379.87 million.
According to Baker, $4.4 million in contract services will go to law enforcement and the Chamber, by which he apparently meant Love Catalina Island.
According to Baker, the Harbor Fund budget is for $9.2 million in revenue and $8.46 million in expenditures.
“So that $750,000, that’s new money,” Baker said.
“You can essentially think of it as available for capital projects,” Baker said.
Baker said sewer and solid waste fund revenues are driven by assessments that appear on property tax bills.
The sewer fund budget anticipates revenues of $3.3 million with operating expenditures of $2.9 million, according to Baker.
He said the $400,000 would be available for capital maintenance in the sewer fund.
According to Baker, 75% of the city’s operating revenues (General Fund) come from the transient occupancy tax, the sales tax, and the admissions tax.
Baker told the council probably close to 70% of TOT comes from hotels and another 30% from vacation rentals.
According to Baker, 54% of sales tax revenues come from bars and restaurants, business that largely serve visitors.
Avalon also gets a share of the Los Angeles County pool for online sales.
Looking at the General Fund expenditures by department, there is an expected increase in law enforcement services of 9.6%, according to one of Baker’s June 4 slides.
However, the final contract between Avalon and the Los Angeles Sheriff’s Department is not yet known. The Fire Department expenditures are budgeted to increase 1.2%. Public Works expenditures are expected to increase 18.2%. Planning expenditures are expected to decrease 24.7%. Community services expenditures are expended to decrease 0.5%. Chamber (Love Catalina) marketing expenditures are expected to decrease 3.2%.
According to Baker, if operating costs go up 5% a year and visitor counts, cross channel and cruise ship revenue is flat, the city needs every other revenue source to go up 10% just to keep revenues growing at the same pace as Avalon’s expenses.
According to Baker, cruise ships have been driving revenue grown in the harbor in 2022, 2023, 2024, and 2025.
