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The City Council will confront its growing FY 04 projected deficit when it adopts a FY '04 budget, due by the end of Sept. The new budget will cover the period coinciding with the
run-upto elections for Council districts 2, 4, 6 and 8.
In November 2001, two of those incumbents -- Councilmembers Dennis Carroll and Rob Webb -- voted to give
then-City ManagerHenry Taboada a pay raise (whose salary was already higher than the Governor's). Councilman Baker voted against it. Councilwoman Richardson was absent for entire meeting. (Now-formerCouncilman Grabinski exited about 45 minutes before the vote, then reappeared roughly 60 seconds after). Shortly before casting his vote, Councilman Carroll told the public that unlike Sacramento, LB City Hall was in good financial shape:
...I think it's important for our citizens to know, and to feel comfortable with, the financial solvency that we enjoy now. This again, in my mind, comes to us largely because of the budgeting processes that we have undergone.
...[The state is] facing a $12 billion deficit, largely it seems based upon the state's handling of their energy crisis, that attempt to subsidize those rates for an extended period of time, and they are now in a position where something has to give...[T]hey have found themselves in a fix that we because of the planning of our city manager avoided. Now while the circumstances aren't exactly parallel, I think that it merits our acknowledgement of our situation...
About six weeks earlier in September 2001 (and after Sept. 11), the City Council voted to adopt a budget that covered the
During late 2001 and early 2002, city management warned in agendized memos (reported by LBReport.com) of the Council's increasing deficit. Much of LB's establishment assured voters that City Hall was on the right track. After virtually all incumbents seeking
Neither city management nor Mayor O'Neill have yet made public their FY 03-04 proposed budget...although nothing forbids them from doing so. The City Charter requires the City Manager to present a proposed budget to the Mayor no later than August 1...and requires the Mayor to release it to the Council (and the public) with her suggested changes, no later than August 15.
Ultimately, decisions on what to spend and/or cut are not made by the Mayor or city management. The decisions are made by voted action of a majority of the City Council.
As previously reported by LBReport.com, a written evaluation by a City Hall budget consultant indicated the General Fund's deficit (spending exceeding revenue) reflects years of previous structural deficits...worsened by the Council's Sept. 2001 budget vote that ballooned FY 2002 spending.
The written evaluation stated in part:
The City of Long Beach General Fund has a major structural imbalance. Simply stated, ongoing revenues are insufficient to provide the dollars needed to support ongoing programs. For several years, this problem has been masked by the use of
...During the recent years, Long Beach has maintained cash and to some degree, budgetary solvency. Cash solvency has been maintained due to the City’s healthy cash flow. This has enabled it to meet current obligations without borrowing. Unfortunately, while budgetary solvency has been achieved, it has been done through the use of one-time financial sources. Long-term solvency, however, has not been attained for several years."
The written evaluation, given to Councilmembers and the Mayor in advance, was placed on the Council's July 1 "consent calendar." It received no public Council discussion before Councilmembers sent it a Council committee.
LBReport.com has placed the written evaluation online (updated to include additional pages, charts and conclusions not previously posted). To view it, click:
Contact us: mail@LBReport.com