Local Government Budget and Finance

1
Local Government Budget and Finance

• POSC 140
• Intro to CA Government and Politics
• Braunwarth

2
Outline

• San Diego (2.2 billion total budget, 750
  million general fund) as an example of
• How Cities Spend
• How Cities Get
• Legislative Impacts
• Creative Raising

3
How Cities Spend Money

• What do you think is 1?
• Police, Fire, Lifeguard 52
• Operations (planning, permits) 16
• Park and Recreation 10
• Sanitation and Health (trash) 6
• Internal Support/Management 6
• Library 4.5
• Neighborhood Services (econ devt)
• Transportation (streets, parking, traffic)

4
Funding Sources (S.D.)

• Property Tax 23
• Sales Tax 19
• Revenue from and property 11
• Motor Vehicle License Tax 10
• Fees for Services (golf, sewer) 9
• Transient Occupancy Tax (TOT) 8
• Fund Transfers (from other govts) 6
• Fines, Permits 9

5
Initiatives and Referenda

• Reflect distrust of elected officials and
  government
• Either cut/limit taxes (Prop 13) or
• Determine tax/spend priorities
• i.e. Prop A (S.D.) Transnet
• 1/2 of sales tax must go to transportation
• Why not?
• Hamstrings officials

6
Proposition 13

• Prop 13 (1979) limited property taxes
• Required 2/3 margin to raise other taxes
• Made state/cities more dependant on Sales Taxes
• Required Fiscalization of Land Use
• Made budget more dependant on the Economy
• Led to big cuts in education (4 - 45)
• 20 year study - authors regret passing

7
Creative Funding for Cities

• Create Redevelopment Districts get low interest
  loans to pay for improvements which raise the tax
  base and pays loans
• E Village, Convention Center, NTC, etc.
• Debt Financing/Bonds need voter OK
• Lease/Sell Property
• Privatization EMS, EDCO, Electricity
• BIDs and MADs (residential)
• Municipal Marketing Programs
• Partnership with vendors (Pepsi)
• 1.5 m on 500 mchns, 12 yrs 20 m