San Clemente City Closes Out Fiscal Year 2019-2020 With Confidence

Press release from the City of San Clemente:

October 15, 2020

FOR IMMEDIATE RELEASE 10/15/2020

CITY OF SAN CLEMENTE CLOSES OUT FISCAL YEAR 2019-2020 WITH CONFIDENCE

Thursday October 15, 2020…San Clemente, California… The close out of Fiscal Year 2019-2020 (July 1, 2019 thru June 30, 2020) shows the City of San Clemente revenues aligned with the City’s financial forecast related to the impacts of the pandemic.

As the City entered the pandemic in March of 2020, the City’s Finance team immediately began preparing for potential impacts, including re-forecasting potential revenue impacts to the City based on the pandemic. At the time, staff anticipated a revenue shortfall of $2.5 million dollars. This anticipated shortfall was primarily attributed to the potential loss of sales tax, transient occupancy tax, and revenues related to City operations (i.e.-rentals, classes and other City amenities) effected by the pandemic. However, it was difficult to know what the specific impacts would be to the City’s revenues since the impacts of the pandemic were unknown at that time. Fortunately, the City’s Finance staff was diligent in monitoring the City’s finances and providing monthly financial updates to the City Council to ensure the public was aware of the City’s fiscal health.

The City’s largest revenues are property taxes and sales taxes, which comprise 68% of all General Fund revenues. Both property sales taxes were in line with the projected amounts identified in March of 2020. Property taxes received exceeded the FY 2020 budgeted amount by $300,000 or about 1%, and sales taxes were below the FY 2020 budget amount by less than $100,000 or 1%. Please refer to the attached Financial Report for details. Other revenues though were down approximately $2.3 million from the budgeted amount, however the City’s proactive cost saving approach of maintaining a hiring freeze and reducing expenditures left the City well positioned to manage this forecasted revenue shortfall and yielded $1.4 million in salary and benefit budget savings.

Most government agencies were in a similar position of attempting to accurately forecasting the true budgetary impacts due to the pandemic. The City of San Clemente has always approached its fiscal position in a conservative manner. By this strategy and the unique structure of the City’s revenues, it has afforded the City the ability to maintain a positive position with its budgets.

While the pandemic is not over, the City will continue its diligence in monitoring and maintaining its fiscal health. “It is important for the public to know that the City of San Clemente will sustain its conservative proactive approach for the coming months to continue with a positive operating position while we endure the pandemic.” said Erik Sund, Interim City Manager.

10-15-20 Press Release - CITY OF SAN CLEMENTE CLOSES OUT FISCAL YEAR 2019-2020 WITH CONFIDENCE

This press release was produced by the City of San Clemente. The views expressed here are the author’s own.