REPORT TO COUNCIL
SUBJECT
Title
FY 2020/21 Budget Rebalancing Actions to Address COVID-19 Pandemic Impacts
Report
COUNCIL PILLAR
Enhance Community Engagement and Transparency
BACKGROUND
The FY 2020/21 budget was adopted during a time of unprecedented uncertainty with both a global public health and economic crisis as a result of the COVID-19 pandemic.
The pandemic suddenly altered the trajectory of the national economy and, while the long-lasting impacts are still not known, they have already been significant for residents, businesses, and the city. Prior to COVID-19, the City's financial forecast was manageable and well-planned; however, like many other cities, COVID-19 has had significant impacts on all facets of regular life and, likewise, is the source of these fiscal impacts presented in this report.
At a local level, several of the City's General Fund revenues have been impacted, with the largest declines in the transient occupancy tax and fees for services categories. When the budget was approved by the City Council in June 2020, the Budget Stabilization Reserve was used to close the projected General Fund deficit of $22.7 million as a first step. The strategy of revisiting the City's fiscal condition during FY 2020/21 was put into place for the purpose of obtaining more economic data, evaluating the duration of COVID-19, and developing expenditure reduction proposals. As the year has progressed, the economic effects from the pandemic have continued, with more severe impacts on the City's revenues than originally anticipated. Through strong fiscal management efforts, the City has been able to develop proposals that suspend expenditures where appropriate due to COVID-19, minimize service delivery impacts, to the extent possible, and avoid employee layoffs.
This memorandum was originally scheduled for Council consideration on September 29, 2020 with subsequent follow-up in December 2020. However, this item was deferred to February 2021 to allow ...
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