City Budget Sessions – Property Transfer Tax Debuts as 3rd Biggest Revenue Source
May 20, 2022
With the current year’s budget adjusted upward by more than $14 million, Culver City’s budget meetings this week tallied up a number of good things about revenue.
The annual budget meetings for the 2022-2023 fiscal year which were heard by City Council last week on Monday May 16 and Tuesday May 17, 2022, covered a report from Chief Financial Officer Lisa Soghor and separate reports from each department of the city. A “stronger and faster than expected recovery from COVID” was at the center of many positive reports.
The general fund revenue overview reported a total of $144,878,638 in revenue. Sales taxes were the top source of revenue, as they have been in the past, followed by business license taxes, and then RE transfer tax which unexpectedly came in third place.
After being approved by voters in the 2020 ballot, the real estate transfer tax brought in $17 million, about $15 million more than expected. The CFO proposed that the excess be recommended to be paid into the city’s retirement trust fund, “to be used over time to smooth the city’s retirement costs.” Like many small towns, the long-term responsibility of the pension fund is an ongoing challenge in creating the annual budget.
Soghor noted, “The city started the current fiscal year of 2021-2022 with $108.8 million. Based on revenues and expenses, the 2022-2023 fiscal year starts with $130.2 million, due to unexpected revenues and reduced expenses.
The report indicates that the projected closing fund balance will see a decrease of $4.3 million, to $129.5 million. Restricted pension trust funds will be used to pay the annual cost of the retreat of $29. 4 million. The remaining reserves of the fund balance of $81.7 million may, with Board approval, be used to balance the budget. Projected unlimited ending reserves are 55% of operating expenses.
“Expenses should be less than revenues. said Soghor.
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