The City of Inglewood presented a balanced FY 2022-2023 budget to the public during the Sept. 20 regular city council meeting after injecting over $13 million in American Rescue Plan Act (ARPA) into the General Fund.
The City anticipates revenue in the amount of $201,806,396 million and $195,858,099 in expenditures which would leave a projected $5.9 million surplus. The revenue includes a carryover of $10.8 million which is from ARPA funds.
The City received nearly $31 million in ARPA funds and has appropriated less than half towards reducing the City’s deficit due to lost revenue from the COVD-19 pandemic.
“This is the first budget in over a decade that is balanced without using the reserves,” said City Manager Artie Fields. “Today the budget is balanced and our unassigned general fund reserve has increased to over $75 million which is the largest amongst comparable size cities.”
Mayor Butts interjected saying the reserves are “bigger” than any other city in the United States.
The City began the 2021-2022 fiscal year showing a nearly $10 million deficit and the mid-year presentation showed that number swelled to $22 million due to capital improvement projects (CIP) that were carried over from prior years. The budget presentation took the ARPA funds into account.
“I want to correct one thing, Mr. Fields says this is the first projected positive fund balance for next fiscal year coming, however, we do have a positive fund balance for this year closing right now,” said Butts. “And although it wasn’t projected we are $10 million ahead of where we thought we would be.”
Over the last two weeks, the city has used ARPA funds to allocate $3.3 million to pay down past due water bills, and an additional $10 million was place into the General Fund which creates $10 million carryover to close the current year.
“Available fund balances in this case clearly speaks to the fact we received more revenue in excess of our expenditures at the close of FY 2021-2022,” said Budget Manager Keaunna Buchannon.
The City didn’t receive new revenue, they received a one-time infusion from the federal government.
Residents in attendance questioned the council on multiple items on the agenda including the Housing Protection Residential Registration fees which are once again not being collected until Jan. 1, 2023.
“That program has been started and stopped how many times,” asked Marvin McCoy. “It should be noted this program isn’t being implemented until after elections.” The City also has to create a Rent Board to be in compliance with the Housing Protection Ordinance.
Residents were also concerned with the city’s projections on admission, property, and sales tax revenues.
The budget shows the City projects an increase in property tax revenue going from $36.5 million this fiscal year and projecting $38.2 million in FY 2022-2023.
“Property taxes have risen because property values have risen,” said Mayor Butts.
Sales tax is expected to increase from $19.8 million to $25.3 million which drew questions about how the City is projecting the additional $6 million.
“You’re playing with the sales tax numbers,” said McCoy. “There’s no way there’s a $6 million increase from last year, with no historical reference, and spending is going down. Outside of the stadium there’s no attractions so how do you anticipate this increase?”
Another resident questioned the huge increase in expenditures for the upcoming fiscal year.
“Our budget is almost $40 million more than last year, in regards to our expenditures, where are they going to?’ asked Fredrisha Dixon.
Buchannon explained expenses went up for personnel costs due to new contracts negotiated with bargaining units along with increased healthcare costs. Pension costs are also up.
Admission tax is the most perplexing as it went from $7.4 million in FY 2020-2021, down to $400,000 this current fiscal year, then swelling to a projected $16.2 million for FY 2023.
The stadium initiative approved by council in February 2015 capped admission tax from SoFi Stadium at $15 million per year.
The discrepancy in the admission tax revenue was attributed to it being classified as “other tax” and combined with development fees, however, previous budgets for FY 2018-2020 only accounted for revenue from the Forum which decreased from $845,000 in FY 2018-2019 to $400,000 in the current fiscal year.
No explanation was given for how much tax revenue was brought in for either YouTube Theatre or SoFi Stadium. Instead of using line items, they presented the Admission Tax figures in the FY 2022-2023 in a convoluted manner.
“It’s easy for anyone to pick up this budget book and see where the money is coming from,” said Mayor Butts, during the presentation, however, if you look in the budget book it doesn’t show how much each venue is generating.
When the City declared a fiscal emergency last August, residents were asked to approve an increased Transient Occupancy Tax on hotels and short-term rentals from 14% to 15.5% which was approved, and residents rejected a proposal to increase Real Estate Transfer Taxes. There wasn’t an option to increase Admission or Parking Taxes for the entertainment venues which generate the most angst amongst residents. Instead, residents are being asked to pay for parking permits to park in front of their homes, limit the number of guests they have over, and pay to register their homes under the Housing Protection Ordinance.
“Residents shouldn’t be penalized for living here and we see no benefits from the money coming in from the stadium,” said Emily Dixon, who lives in close proximity to both SoFi Stadium and the Forum. “We are held captive in our homes due to the traffic.”
Residents continued to press for a more transparent process on the community having input on the budget and it being presented to the public in a more user-friendly manner.
“The city declared a fiscal emergency last August, and residents would like a more simple format of this budget because its difficult to understand where the money is coming from and where it’s going,” said Miya Walker.
She compared it to the presentation given by Inglewood Unified School District which makes it easier for the public to decipher.
While many cities around the South Bay hold budget workshops before their budgets are adopted, Inglewood does not.
The City’s new fiscal year begins Oct. 1 and still have $18 million of ARPA funds to allocate.
Emilie St. John is a freelance journalist who appears weekly in the Los Angeles Wave newspaper and can be reached at email@example.com.