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Revenue forecasts first step in city’s budgetary process

by Steven Felschundneff | steven@claremont-courier.com

City staff is well into the process of developing Claremont’s 2021-22 budget, according to a presentation at Tuesday’s Claremont City Council meeting by City Manager Adam Pirrie.

Mr. Pirrie’s report focused on projected revenue with an emphasis on the general fund. There will be another report to the city council on expenditures on April 27, followed by a community budget workshop on Saturday, May 15, with the ultimate adoption of the budget scheduled for the council meeting on June 8.

Total city revenues for 2021-22 are projected to be $51,638,407, which is $2,240,599 more than in 2020-21, a 4.54 percent increase. The two biggest drivers of the increase are the general fund, which is projected to bring in an additional $1,657,172, or 6.2 percent over last year, and enterprise funds which are projected to be up $652,371, or 7.19 percent. Only two areas will bring in less money, including special revenue funds, down $99,874, or 1.1 percent, and internal service funds which are basically flat, reduced by $2,000 or .09 percent.

The most significant sources of general fund revenue come from taxes, including property, sales, transient occupancy, business license and utility user taxes. Together, these sources make up 79 percent of general fund revenue.

The biggest single source of general fund revenue is property taxes, with a budget for 2021-22 of $11,013,700, a three-percent increase. The biggest mover is projected to be sales taxes, which is budgeted at $5,304,000, and represents a 26.83 percent increase over the previous year, which was highly impacted by the pandemic. 

Another big mover is “other taxes” which is projected to be up 24.87 percent, although it is a relatively small portion of the general fund at $949,000. Other taxes include franchise fees paid by utilities and property transfer taxes paid on the sale of real estate in Claremont.

Declining revenues include a 21.79 percent fall in licenses and permits to $933,002, and 13.1 percent decrease for fines and forfeitures at $546,000. Transient occupancy taxes, which are paid by visitors at our local hotels are expected to bring in 9.43 percent less revenue, for a total budget of $1.2 million.

Other sources of income for the city include: special revenue funds budgeted at $8,933,531; capital projects funds, $548,300; enterprise funds, $9,729,936; internal services funds, $2,285,180; and successor agency, $1,753,832. For details on these areas of revenue please see the meeting agenda packet on the city’s website: https://www.ci.claremont.ca.us/Home/ShowDocument?id=16259

Not included in the budget process is Claremont’s portion of the American Rescue Plan Act, otherwise know as President Joe Biden’s stimulus bill. The city is expected to receive $6.83 million from the act, however, Mr. Pirrie has yet to receive guidance on how the city can spend the money. Possible ways the money could be used are revenue replacement for government services, COVID-19 expenditures and investments in infrastructure. Staff anticipates developing a spending plan once they receive guidance form the federal government, according to Mr. Pirrie.

“The development of the 2021-22 operating and capital improvement budget for the city is ongoing. The projected revenues included in this report are preliminary. As more information becomes available relative to cost of living factors, current revenue trends and development activity in the city, revenue estimates will be updated for the presentation of the budget to the city council and community later in the year,” Mr. Pirrie said in a statement.

 

Parklet program extended

Tuesday afternoon, a brouhaha erupted over the social media-fueled claim that the city council was considering ending the al fresco program, which has allowed a number of Claremont’s restaurants to operate outdoors during the pandemic.

In fact, a proposal to extend the program through July 4, 2022 was included in Tuesday’s consent calendar, which is reserved for routine matters such as adopting the minutes of the previous meeting. Items on the consent calendar are voted on in bulk by the council unless a specific item is pulled by a councilmember.

Under the al fresco program, several area eateries have constructed ”parklets” over street parking adjacent to the restaurant to provide additional outdoor seating during the months when the county did not allow indoor dining. Several businesses have invested considerable money to make their parklets both functional and appealing.

Councilmember Ed Reece pulled the al fresco extension from the consent calendar because he had questions about the impacts of the loss of parking space in the Village, particularly as coronavirus restrictions are lifted and more people are coming to Claremont.

“Prior to COVID, parking was a premium in the Village and I was curious if we have analyzed any impacts of the parklets to the existing parking?” Councilmember Reece asked.

Mr. Pirrie responded that due to decreased demand for parking during the pandemic assessing the impacts of the parklets has been problematic because the Village is nowhere near capacity—in short no analysis has been conducted yet.

As a follow-up, Councilmember Reece asked if businesses open up later this year and the economy picks up, what the city might do about parking as the Village becomes busier.

Mr. Pirrie said that in the event the city does see some impact to parking as it emerges from the pandemic, staff will work to ensure that as much parking is available as possible to the public. He pointed out the sizable Metrolink parking lot is frequently underused and that an effort could be made to advertize that option.

“We will certainly do our best to make sure that residents and visitors to the village are aware of those parking options until that time that the parklets are no longer an issue,” Mr. Pirrie said.

The city received 175 emails in support of continuing the al fresco program and one against. All communications were distributed to the council and imaged into the permanent record.

“I truly value our community for supporting the restaurants in town by supporting the parklet program. I am sure that our local restaurateurs feel your support and your love,” Mayor Jennifer Stark said.

“While I did have those questions on parking, I just wanted to share that I am in full support of extending this temporary outdoor dining until July 4, 2022,” Councilmember Reece said.

The council voted 5-0 to approve the extension.

 

On a side note, the city is currently testing technology for a hybrid model to return to in-person meetings while maintaining some type of online streaming, according to Public Information Officer Bevin Handel. The exact time frame for returning to the council chambers is not known and will depend on guidance from county public health officials, however, Ms. Handel said it will likely be summer or early fall.

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