Cities Shorted On Stimulus Money? Palm Springs Says It Was

PALM SPRINGS, CA — Millions of dollars of federal CARES Act funds have been handed out to help cities in Riverside County and across the state deal with the impacts of coronavirus, but Palm Springs officials say the distribution formula is flawed. The officials claim their city and other smaller jurisdictions across the county have gotten shortchanged.

In the wake of California’s recent allocation of $500 million of federal CARES Act funds, the city of Palm Springs recently sent a plea to several state officials, including Gov. Gavin Newsom, Assemblyman Chad Mayes, State Sen. Melissa Melendez and U.S. Rep. Raul Ruiz, requesting that more funds be distributed for financially struggling cities like Palm Springs, which have populations of less than 300,000.

The July 20 letter points out that because the recent funding dispersement was based only on population, the largest 13 cities are receiving between $85 and $174 per resident — cities with smaller populations like Palm Springs are receiving just $12.28 per resident (see distribution amounts below).

Palm Springs officials argue that the city of Riverside has approximately seven times more full-time residents than Palm Springs, yet Riverside received nearly 50 times more funding ($600,000 vs. $28,000,000). Riverside residents comprise only 16 percent of the county’s total population but the city received 57 percent of the total funding, Palm Springs officials noted.

The combined nine Coachella Valley cities have 20 percent more residents than the city of Riverside, yet Riverside received six times more funding from the state than the nine combined.

In the letter to state leaders, Palm Springs officials contend that financial relief should not be tied to population alone, and that loss of revenue should be considered. Tourism is a main driver of the Coachella Valley economy, and the COVID-19 shutdown has hit that sector hard.

The 2020-21 budget for Palm Springs reflects actions taken to address a projected $47 million shortfall. It comes on top of a $29 million shortfall for the 2019-20 fiscal year.

“It is also noted that Palm Springs’ projected loss of $47 million for the 2020-21 fiscal year is close to double that of Riverside at $28 million. Yet Riverside is receiving $28 million and Palm Springs is receiving only $600,000,” the city said in a released statement.

“COVID-19 has led to significant loss of revenue for our city and severely affected core public safety and other important services our residents and visitors in Palm Springs depend upon,” said Councilmember Lisa Middleton, who along with Mayor Geoff Kors, serves as City Council Budget liaisons. “Distribution by population alone, without reference to revenue lost due to COVID-19, is simply not fair. Treating people unequally, even when based on population, because of where they live — is to double down on the unfairness.

“This dramatic loss of revenue means smaller cities like Palm Springs are unable to backfill their services and provide critical support for businesses and residents, including rent relief, provision of PPE, enforcement of state orders and other much needed assistance," she continued. “Distribution of funds to local municipalities in this manner is unjust and poorly thought out and we respectfully request that our state and federal governments listen to our plea and take action to ensure a more equitable resolution to this appalling situation.”

Kors added, “To say to the public that Palm Springs residents, and residents of the more than 400 smaller cities representing 72 percent of California’s population, are only worth $12 per resident while residents of the largest cities are worth between $85 to $174 is outrageous and deeply offensive.”

Riverside County Incorporated Cities 2020 CARES Funding:

City —— Population —— 2020 CARES Funding

1. Riverside —— 328,101 —— $27,977,068
2. Moreno Valley —— 208,297 —— $2,558,872
3. Corona —— 168,101 —— $2,065,075
4. Murrieta —— 118,125 —— $1,451,134
5. Temecula —— 113,826 —— $1,398,322
6. Jurupa Valley —— 106,318 —— $1,306,088
7. Menifee —— 93,452 —— $1,148,032
8. Indio —— 89,406 —— $1,098,328
9. Hemet —— 84,754 —— $1,041,180
10. Perris —— 76,971 —— $945,568
11. Eastvale —— 66,078 —— $811,750
12. Lake Elsinore —— 62,949 —— $773,311
13. Cathedral City —— 54,907 —— $674,518
14. Palm Desert —— 53,625 —— $658,769
15. San Jacinto —— 48,878 —— $600,453
16. Palm Springs —— 48,733 —— $598,672
17. Beaumont —— 48,401 —— $594,593
18. Coachella —— 46,351 —— $569,409
19. La Quinta —— 42,098 —— $517,163
20. Wildomar —— 36,066 —— $443,061
21. Banning —— 31,044 —— $381,367
22. Desert Hot Springs —— 29,251 —— $359,341
23. Norco —— 27,063 —— $332,462
24. Blythe —— 20,817 —— $255,731
25. Rancho Mirage —— 18,489 —— $227,132
26. Canyon Lake —— 11,285 —— $138,633
27. Calimesa —— 9,159 —— $112,516
28. Indian Wells —— 5,445 —— $66,890

*Subtotal (excluding Riverside): 1,719,889 (pop.) —— $21,128,370 (funding)
*Total (including Riverside): 2,047,990 (pop.) —— $49,105,438 (funding)
*Riverside % of Total Population: 16.02% —— Riverside % of Total Funding: 56.97%
*Coachella Valley Cities: 388,305 (pop.) —— $4,770,222 (funding)
*Coachella Valley Cities % of Total Population: 18.96% —— Coachella Valley Cities % of Total Funding: 9.71%

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