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Unexpected Funds: La Palma Budget Nearly Balanced

BY BRIAN HEWS • December 11, 2020

In the beginning of the year La Palma, like all other cities, set aside funds due to the pandemic.

Now the city has learned that, due to near normal taxes, two grants, and unexpected long-term investment income of over $200,000, “revenues exceeded expenditures and the deficit did not happen.”

During budget talks, city officials estimated it could run a deficit of nearly  $500,000 because of stay at home orders and other COVID implications.

But many expenses that had been budgeted did not occur, contributing to a “million-dollar swing” that produced a nearly balanced budget.

In that case, the city will not have to dip into reserves to balance the budget.

While the current budget does show a slight deficit, Matsumoto said, “I’m not sure you will end up with that deficit unless things get a lot worse.”

Matsumoto recommended the city wait until early 2021 to make any changes.

The Council debated over leaving funds budgeted for a city event that was to occur earlier this year, but moved to 2021.

Acknowledging they could always move the funds if the pandemic prevents the city from hosting the event, the council voted 4-1 to approve a resolution to amend the 2021 budget.

In other news, the City Council voted unanimously to approve a raise in the salary of the city manager from $190,000 to $199,500 per year, plus benefits.