Adopted by the City Council in June, the general fund was shaved by $9.7 million during an arduous budgeting process that kept City Hall on edge for months.
But construction-related permits fees are expected to come in at $1.5 million less than expected by year-end, while sales tax revenue is projected to be down by $1.2 million, officials said.
The sales tax gap could shrink if local revenue figures from the holiday shopping season, which have yet to be released, are greater than expected.
Officials do not project the need for additional budget cuts this year as the gap will likely be filled through the current hiring freeze of more than 80 city positions, Elliot said.
“We are counting on those savings to carry us through the end of the year, and as such are not recommending any adjustments at this time,” he said.
Next year’s budget gap could also be significantly reduced if the City Council elects to maintain the hiring freeze for another year, which would generate between $6 million and $7 million in savings, City Manager Jim Starbird said.
The council is expected to begin preliminary budget discussions next month as city officials ramp up for next year’s budget cycle.
“My feeling is the sooner we start the better,” said Mayor Frank Quintero. “I’ve always felt somewhat rushed.”
It will be the third year in a row that the City Council is forced to fill a significant budget gap, with more than 100 positions slashed in the past two years.
So far, the hiring freeze, wage concessions and dozens of eliminated positions have saved city employees from widespread layoffs or mandatory unpaid work furloughs, which agencies statewide have been forced to institute.
While city officials acknowledged the tough financial times, they downplayed the budget gaps, citing the deeper woes of neighboring cities, which are facing much steeper budget gaps in the coming fiscal year.
“It’s nice to be better off than the state and the city of L.A. and et cetera,” Councilman Dave Weaver said.
