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Goleta Faces Budget Deficit

City Manager Says Problem Is Short Term

Tuesday, May 26, 2009
By Rachel Reeves

In a telephone interview Friday, Dan Singer, Goleta’s city manager, confirmed that the city’s preliminary budget plans have not yet been finalized. He did say, however, that the City Council predicts a $1.1 million budget deficit for the 2010 fiscal year, as revenues hover around $14.1 million and expenditures exceed $15 million.

Singer said that though the city is facing fiscal difficulties, council members expect the situation to improve in a few years. He explained that Goleta’s Revenue Neutrality Agreement, which allows for Santa Barbara County to receive a percentage of the city’s taxes, does not significantly exacerbate Goleta’s budget problems. Concerns have been raised by some city residents and elected officials - Councilmember Eric Onnen and many members of the Goleta Valley Chamber of Commerce, among others - that the county was cutting too far into the city’s revenue in a deal they said was flawed from its inception. Prepared in 2002, the agreement was a precondition for the incorporation of Goleta into the county, and though it is not particularly favorable to the city’s fiscal situation, Singer said it represents only a short-term hurdle. “Like any other agreement with the state, we’d like it to eventually sunset and go away,” Singer said, “but we are in a really favorable position even though we have this short-term problem for the next few years. The agreement allows for a big bump at the 10th year of incorporation, so in three more years we’re going to get a significant [increase in revenue].”

The Goleta City Council will meet again Tuesday to discuss budget challenges, revenue neutrality, and how to manage both.

Rachel Reeves is an Independent intern.

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