estimated a couple of months ago<\/a>, but it could still mean the toughest budget season since the Great Recession.<\/p>\n\u201cAt this magnitude, the shortfall is going to require general fund service reductions,\u201d Modica said. They would be the first budget cuts since the COVID era.<\/p>\n
No specifics were discussed yet, but Modica said the city will seek to preserve core services.<\/p>\n
Tuesday\u2019s meeting was an early glimpse at the budget. The spending plan is typically unveiled in July, scrutinized and adjusted at a series of public hearings and adopted by the City Council in September before the fiscal year begins in October.<\/p>\n
By law, it must be balanced. To cover any deficit, the city must raise revenue, cut expenses or draw from reserves.<\/p>\n
Most of the $3.7 billion budget is made up of restricted funds that must be spent on specific needs or in specific areas. That means the majority of jockeying is focused on the general fund, a $774 million pot of money without those strings attached.<\/p>\n
City employee-related costs make up 77% of the general fund expenditures. Long Beach\u2019s recent success in speeding up hiring \u2014 narrowing its vacancy rate to 16.8% this year from 22% in 2023 \u2014 means those costs have gone up. When accounting for expenses for things like equipment and benefits, it takes on average $270,000 for every added police officer or firefighter, for example.<\/p>\n
Officials threw out a laundry list of reasons for the deficit, largely pegged to larger economic factors: Tariffs and inflation driving up the costs of city business; sales tax, property tax and utility taxes bringing in millions less than expected; and funding cuts to the city Health Department, which relies mostly on state and federal grants. The city\u2019s Public Works Department must also adjust significantly under the Trump administration, with $221 million in federal funding lost or delayed, Modica said.<\/p>\n
It was not all bleak news. City officials are bullish on the hotel and sales taxes coming in from Long Beach\u2019s tourism industry, which they said is recovering faster than San Diego, Anaheim and Los Angeles.<\/p>\n
And, in hopeful news, the city projects any deficit will be short-term. They previously thought the shortfall would run through 2031, but now expect deficits only in 2027 and 2028. Afterward, they say, there will be minor surpluses on the horizon through 2031.<\/p>\n
If you think about it, Mayor Rex Richardson said, it\u2019s really just one tough year to get through.<\/p>\n
\u201cThe good news is we have a clear path forward if we stay disciplined this year by meeting our savings targets, continuing to find efficiencies, living within our means, we\u2019ll be on track to return to a surplus within the next year or two,\u201d Richardson said.<\/p>\n
Community meetings to review the new budget began in January and will resume in August. For anyone interested in attending, check here<\/a> for updates.<\/p>\n","protected":false},"excerpt":{"rendered":"Long Beach\u2019s top administrator warned its elected officials to prepare for tough decisions this summer as they enter…\n","protected":false},"author":2,"featured_media":259573,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[33],"tags":[2076,131,133,132],"class_list":["post-259572","post","type-post","status-publish","format-standard","has-post-thumbnail","category-long-beach","tag-budget","tag-long-beach","tag-long-beach-headlines","tag-long-beach-news"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/us-ca\/wp-json\/wp\/v2\/posts\/259572","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/us-ca\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/us-ca\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-ca\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-ca\/wp-json\/wp\/v2\/comments?post=259572"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/us-ca\/wp-json\/wp\/v2\/posts\/259572\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-ca\/wp-json\/wp\/v2\/media\/259573"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/us-ca\/wp-json\/wp\/v2\/media?parent=259572"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-ca\/wp-json\/wp\/v2\/categories?post=259572"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-ca\/wp-json\/wp\/v2\/tags?post=259572"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}