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Cerritos Council Reviews $83 Million Budget for 2012-13

By Jerry Bernstein

The Cerritos City Council has reviewed the city’s preliminary budget for 2012-13 and City Manager Art Gallucci said the city anticipates overall revenue to be approximately $83 million, a decrease of approximately $2,.5 million or 2.96 per cent from the current fiscal year.
Gallucci said approximately $14 million of this amount provides income to the water, reclaimed water, sewer fund and electric utility functions. The council will give final approval to the budget at its June 28th meeting.
The largest revenue source for the City continues to be sales tax and interest income comprising approximately 40 percent of the city’s operating budget. The recession has impacted both these sources of revenue the past three years, he said, but an increase is forecast for sale tax revenue.
City officials pointed out that in past years the city’s reserve has protected Cerritos from outside economic pressures, but no city can indefinitely continue to use its reserves, otherwise it would have no buffer.
Gallucci said the last fiscal year, before the economic collapse of 2008, Cerritos actual revenues for all City Funds at year end was $95,223,834. This contrasts with projected all-funds revenue for the upcoming year of an estimated $83,016,770, and anticipated reduction of $12,207,054 or approximately a 12.82 reduction , He said the city however, has been able to achieve remarkable expenditure reductions by approximately $9,218,000 or approximately 9.7 percent.“
“To ensure the ongoing effectiveness of these reductions,” he said, “it will be necessary to continuing a hiring freeze on position vacated by attrition.”
The city manager also said that even with the aggressive expenditure reduction the City has had to use reserves during the past two fiscal years to advert dramatic reductions in services. “It is our intent to refrain from using reserves this coming year unless it is absolutely necessary.”
Gallucci also told Los Cerritos Community Newspaper that in its long-time efforts to be proactive in the development of new and diverse revenue sources, Cerritos will be receiving approximately $6.5 million in building and ground lease revenue to be paid in accordance with agreements with Lincoln Station, the Cerritos Towne Center, the Auto Square and other projects.
For the 2012-13 fiscal year, the total City revenues are projected to be $83,016,770, while the projected reimbursement revenue total for the Cerritos Successor Agency is $31,379,125. for a total revenue package of $114,395,895.
The proposed operating budget, not including capital projects and Successor Agency expenditures is $85,704,140, representing a decrease of $3,176,780 or 3.57 percent from the prior year. When capital project are added to the operating budget, the city’s expenditure total increases to $88,313,640. The combined budgetary total of all City and Successor Agency activities for fiscal year 2012-13 is $119,692,765.
Cerritos Center for the Performing Arts
Turning to the Cerritos Center for the Performing Arts, he said the total proposed budget for the theater is $7.6 million. This is a reduction of approximately 801,980 or 9.54 percent from the prior year.
“In addition to the schedule of 70 to 75 events scheduled for the coming season, Gallucci said the 2012-13 budget will include funds to support a variety of community programs. These include the Cerritos Chamber of Commerce, the Friends of Arts Education and the ABC Unified School District. Cerritos Resident Clubs and city hosted events.
Street Projects
During the upcoming year, money has been allocated for the following street projects: Resurfacing of 183rd Street between Gridley and Palo Verde, $982,500; Studebaker Road Landscaping and an Auto Square Freeway Sign, $350,000; Parkway/Planter Block Wall Improvements, $78,000. This will be funded by the Art in Public Places Funds. Additional project costs would be shared by the auto dealers; Wheelchair Accessible Ramps, $25,000; and Towne Center Light Standards, $15,000.
Low to Moderate Income Housing
Gallucci noted that in 1994 the legislature mandated that all redevelopment agencies set aside 20 percent of all increment revenue for construction and/or rehabilitation of housing for low-to moderate income household. The Cerritos Redevelopment Agency set aside approximately $6 million per year for such purposes and built four projects. They included Emerald Villas, completed in 1999; Pioneer Villas, completed in 2001; Vintage Cerritos, completed in 2003 built on the Cerritos College Campus; and Fountain Walk which opened in 2007.
He said given the curtailment of the Cerritos Redevelopment Agency and the uncertainty regarding the use of former low and moderate income housing funds, it is impossible to predict the future housing projects in California.
He concluded by saying, “As the economy continues its inevitable improvement, Cerritos will be in a position to take full advantage of it. He cited the Cerritos Auto Square as an example, which he said has rebounded from a time of unprecedented turmoil to reaffirm its status as the world’s most successful auto mall, with new dealerships and exciting new brands.