Decisions by the Yorba Linda City Council on allocating excess cash reserves and a state-mandated progress report on meeting California housing requirements merit attention this week.
Council members approved the disposition of about $7.2 million in excess reserves held in the general fund reserve account at a March 17 meeting. Most of the cash – $5.6 million – will be moved to a special reserve fund for future capital improvement projects.
Significant amounts of $583,100 each will be used to help offset the city’s unfunded pension and post-employment benefits liabilities. Since mid-2017, the city has allotted about $3.1 million to offset the pension liability and about $3.7 million for post-employment benefits.
The council’s action included retaining the remainder in the general fund operating reserve.
The separate library fund, with revenues exceeding expenditures by $933,800, transferred $700,000 for future maintenance and capital improvements and contributed $116,900 each for meeting unfunded pension and post-employment benefits liabilities.
A council policy states that when general fund operating reserves exceed 60% of general fund appropriations, city staff will recommend to the council a plan to use the excess funds, which totaled $7.2 million. Some $23.8 million will remain in the reserve fund.
When the current fiscal year ends June 30, a $51,000 operating budget surplus is expected, down from $114,253 anticipated when the council approved appropriations of $50.9 million.
The state requires cities to submit an annual report summarizing progress on implementing the city’s general plan and reports on housing production, stated a report from Planning Manager Chris Dominguez.
“The city remains in compliance with state housing laws and maintains a state-certified housing element, but like most cities, may be subject to … provisions related to housing production progress,” Dominguez reported.
The city’s current Regional Housing Needs Allocation is to provide opportunities for 2,415 units, including 765 for very-low household incomes, 451 for low household incomes, 457 for moderate household incomes and 742 for above-moderate household incomes.
The report states that for 2021 through 2025, 239 units have been permitted, including 91 for very-low income households, 24 for low income households, 16 for moderate income households and 109 for above-moderate income households.
Yorba Linda has been subject to a state provision requiring “by right approval” of projects proposing 50% affordability units since 2018, without ever having a developer submit a project under that provision, according to Dominguez.
This provision is separate from the “builder’s remedy” under the state Housing Accountability Act, allowing “by-right approval” of projects that do not comply with the general plan or zoning code in cities without a state-certified housing element, a requirement that Yorba Linda meets, Dominguez noted.
Jim Drummond is a longtime Yorba Linda resident. He regularly gives his take on local issues. Send e-mail to jimdrummond@hotmail.com.