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Long Beach City Manager wraps up 2010, explains financial challenges for the new year

January 7th, 2011 · No Comments · Finance

By CJ Dablo
Staff Writer

Long Beach City Manager Patrick West said on Wednesday that upcoming budget decisions are not going to be easy for City leaders.
“The biggest challenge is going to be for our city council to make these tough, tough, tough ‘Sophie’s Choice’ decisions on our budget,” said West.
One of those tough decisions, according to the city manager, will affect City employee pensions.
West joined Fourth District Councilmember Patrick O’Donnell at his monthly “Chats with Pat” meeting at the Los Altos Library, 5614 N. Britton St. O’Donnell regularly invites constituents and guest speakers to discuss issues that affect their community.
Dozens of audience members listened intently as West enumerated Long Beach’s 2010 accomplishments despite the tough economic times.
West explained the budget outlook, underscoring that the city’s deep financial woes are long-term problems.
Long Beach faced a $38 million deficit in the last year, West said, adding that this year the deficit is estimated to be $18.5 million. The city manager estimated that the city might face $20 million in deficits for fiscal years 2012, 2013 and 2014.
He asked the audience to put themselves in the shoes of the city manager and city council as they try to decide how city services will be affected.
“At what point in time do you cut back your public services or public works department to make sure that you have an adequate supply of officers in your police department?” he asked.
The cost of employee pensions is high. According to the city manager’s projections for the next decade or two, the City’s pension system is under funded by $1.2 billion.
West added that every city in California is trying to resolve the high-cost problems of staffing. Reducing labor costs while providing sufficient city services will be the councilmembers’ chief problem, he said.
West also tempered the bad financial news by acknowledging that the city has made strides to help local businesses grow in the past year. He noted the creation of a “design district” in O’Donnell’s district in which graphic-artist firms renovate older buildings on Anaheim Boulevard. West advocated creating an arena to encourage business like graphic design in the district.
“It’s not just cut, cut, cut but it’s also how do you grow down the road,” O’Donnell added, noting that the city should plan for both the long and short term.
And the City has made other moves to infuse money back into the local economy. West said that the City took advantage of stimulus funds offered by the federal government. Long Beach applied early to use stimulus funds to pay for many of the city improvement projects, like an aggressive street repair system.
The city has repaired about 19.3 miles of street, he said, and 1,500 potholes have been fixed in the last two weeks.
Renovations to the city’s airport parking structure and passenger concourse have also begun. In addition, a leaky roof at the Long Beach Main Library has been repaired, and phase one of a plan to restore the wildlife at Colorado Lagoon has been completed.
“In Long Beach, we all recognize that 2010 was a horrendous year, financially,” West said. But, he added, looking back at some of the things the city has accomplished in 2010, “it has been a fantastic year.”
O’Donnell and West pointed out that the City has also created a $9 million budget stabilization fund, which will improve the city’s bond rating.
Roger Boswell, a 65-year-old local Long Beach resident, said he comes to the meetings often, and he is hoping for an economic upturn and tries to keep informed by attending the monthly “Chats with Pat” meetings. Boswell said that he hasn’t seen many signs of a slowing economy in his immediate neighborhood. He has, however, seen businesses close around the rest of the city. “But it’s starting to turn around,” Boswell said.
The City will soon be negotiating labor agreements involving pension plans with six organizations that represent city employees. West said the labor organizations recognize what’s at stake for the local economy.
“All of our employee groups, everybody gets it, and understands that change is needed,” West said. “But again, it’s a hard process to get where we need to go.”

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