Fullerton City Council members’ tempers flared on Tuesday after a presentation that laid out the city’s financial future.
The conversation centered around a ballot measure that was put forward by the council in July which would increase sales tax by 1.25%.
If approved by voters on election day, it is estimated that the measure could net the city roughly $25 million a year; it would be a steady revenue source with no set expiration date. The only way to repeal the tax would be another decision by voters, according to the city’s measure.
The new taxes would primarily be used to repair roads and other infrastructure, which have ‘been criticized by the Fullerton community.
The city has struggled financially for decades, but one of the few certainties presented by city staff is that without new taxes, the city will be in financial trouble.
Ken Domer, the city manager, said if the tax measure does not pass, the city would need to reduce its expenditures by $5 million every year in order to remain stable.
Domer also said that to stop any further breakdown on roads, the city would need to find an additional $6 million in the budget on top of their $5 million spending cut.
Currently, the city is managing much of its financial problems by not hiring for vacant positions, but Domer said that will not last much longer and that “good portions of departments,” will be cut.
“There's going to be a point in time where our expenditures continue to outpace our revenues, and we're going to be looking at those services,” Domer said, mentioning cuts could come from a variety of departments including parks and recreation and the fire department.
Beyond damages to the city’s spending, its long-term financial health could be in jeopardy. According to a projection shown by Ellis Chang, the city’s director of administrative services, the city will run out of reserves by 2024.
“We would be ending fiscal year 24-25 with a negative ending fund balance,” Chang said. “Without additional, more sustained budget cuts, and programmatic cuts, it's going to be very difficult for the city to operate the way it has done historically.”
When asked by Councilman Ahmad Zahra if that meant bankruptcy, Chang said that while it didn’t rise to the level of bankruptcy, there would be many “difficult decisions” the council would have to make.
Councilman Bruce Whitaker publicly voiced his opposition to any new taxes, and said the city staff’s presentation was a “campaign event,” and that the city needs to focus on cutting spending instead of boosting revenue.
“This as a study session was really much more something trying to sell the sales tax. So those of us who oppose the sales tax, there are so many arguments to be stated in contrary to what we were given here tonight,” Whitaker said. “Your votes, and other votes over the years, have contributed to where we're at now. So if there is a complaint about the city's policies, I’m not to blame.”
Other members of the council shot back at Whitaker’s assertions, and asked why he had not acted to fix the system in the multiple terms he spent on the council.
“Everything you stated was fantastic, you've stated the obvious, but you've given us no solutions in the last 10 years,” Zahra said. "Revenue is our problem. Cuts, cuts, cuts have happened over the last decade, and what did it get us? Bad roads and declining services.
Councilwoman Jan Flory, who is set to leave office a few months after her appointment to the council last year, asked what the alternative plan would be.
“You (Whitaker) blame the council for its votes in the past, but the fact of the matter, you never prepared another path for us to follow,” Flory said.
Whitaker asked for a chance to respond, but Mayor Jennifer Fitzgerald wrapped up discussion on the budget shortly after, and said she agreed with many of Flory’s comments.
The final decision on what cuts are made to the budget will be decided after the November election, where the tax measure will either pass or fail and at least one new council member will join the board.