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Noozhawk.com Santa Barbara Challenge

Regulations, Restrictions Reduce Wiggle Room in Crafting Santa Barbara’s Budget

Numbers game more like a chess match when trying to reallocate funds and balance books

[Noozhawk’s note: This is one in a series of articles on Noozhawk’s Santa Barbara Challenge, our public-engagement project on the city of Santa Barbara’s budget. Related links are below.]

By now, you’re probably brimming with ideas about how to fix Santa Barbara’s budget problems. Looking at the city’s balance sheets, you may be thinking that Santa Barbara should have plenty of money, and could somehow shuffle some from another place to help the ailing General Fund.

You may be right, but as usual with government agencies, there’s plenty of fine print to remember.

We’ve told you about some of the restrictions, like how redevelopment agency monies can only be used for the downtown area that sits inside RDA boundaries.

                  Santa Barbara Challenge Survey  |  Complete Series Index  |

Noozhawk checked in with city Finance Director Bob Samario about municipal finance rules. As your ideas begin to simmer, here are a few more restrictions to keep in mind when mulling what to do:

Enterprise Funds

» Wastewater and water operations revenues are restricted by state law. Likewise, waterfront funds can only be used for operating and capital costs. Because the Santa Barbara Airport receives federal grant support, it’s required to use any and all revenues it generates exclusively for its operating and capital expenses.

» Unlike the first four, revenues from the city’s downtown parking fund and golf fund aren’t restricted, so they’re fair game. The accounts exist to cover operational costs and the like, but aren’t legally restricted to those uses.

Special Revenues

» Federal grants for a specific purpose are also off-limits. Money that’s resulted from voter-approved measures, like Measure A, the half-cent sales tax approved by voters in 2008, is untouchable, too.

» State grants that the Police Department receives for things like the COPS program, which is short for Citizens Options for Public Safety, must go toward police activities.

» Speaking of police, any revenues SBPD receives from officer-issued citations go into a special fund to be used for traffic safety; the funds can not be used to pay officers. However, school crossing guards, for example, can be paid out of the fund because they aren’t full-time members of the police force.

» Any money the city gets from the Santa Barbara County gas tax must go to improving streets for alternative transportation.

» Revenues from parking citations, about $900,000 a year, aren’t restricted and can be used in the General Fund with a majority of City Council approval.

» The city also has internal service funds, used for vehicle replacement and the like, but those funds are restricted unless they are directly connected to the General Fund. For example, reserves generated to replace police and fire vehicles are unrestricted, because they come from the General Fund.

Samario provided another example of a fund, called the self-insurance fund, which is an emergency fund of sorts to help cover any workers compensation claims or liability claims. The fund had more money than was required over the past five years, and in 2009 and 2010, the city moved $3 million to the General Fund to help make up for shortfalls. But the unrestricted portion of those funds are gone, and money must be found elsewhere.

One last thing to remember as you brood over your budget solutions. On the revenue side, Proposition 218 says that all taxes and most charges on property owners must be approved by voters.

The prickly mood of taxpayers and the byzantine rules governing the city’s funds up the ante of the Santa Barbara ChallengeSanta Barbara Challenge, but we’re confident you’re up for bringing solutions forward to city leaders.

                  Santa Barbara Challenge Survey  |  Complete Series Index  |

Noozhawk staff writer Lara Cooper can be reached at .(JavaScript must be enabled to view this email address). Follow Noozhawk on Twitter: @noozhawk or @NoozhawkNews. Become a fan of Noozhawk on Facebook.

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