Earnest: Del Mar is moving forward in a rough economy
The State of the City
Del Mar continues to adapt and progress despite a deep economic recession that has hindered several of its major revenue streams, Mayor Richard Earnest said in his annual state of the city address.
“We’re living in unparalleled times, local governments are suffering their worst revenue losses in decades, and the California state budget deficit is the largest in the nation, exceeding the entire GNP of many nations,” he said. “There seems to be no end to the fiscal woes in California and no desire in Sacramento to fix them.”
Earnest said revenue from sales and transient occupancy taxes has gone through major declines over the last two years. A recent staff report says TOT, for example, is $300,000 below projected. Voters in 2008 gave the city the authority to raise the tax to 13.5 percent, but in these economic times, it has only gone up to 11.5 percent. Earnest said the TOT revenue is still down because there are fewer occupied rooms in Del Mar hotels.
“In past two years, managing the city budget has sort of been akin to catching a falling knife,” he said, adding other visitor-based revenue such as parking meter income and violations has declined. Earnest said parking meter fees would increase to $3 per hour in the summertime.
Despite this, the mayor said the city’s property tax revenue grew by 8.4 percent in the last year, the highest in San Diego County.
Earnest said, however, that there are still increased expenditures in this recession. These include the Shores property maintenance and debt service costs, public safety and supporting the infrastructure impacts from the fairgrounds.
Earnest said city staff has foregone salary increases for two years, eliminated vacant positions, and left others unfilled while workers take on extra tasks. He also said the city has looked further to unpaid student interns to help in the planning department.
“We adjust and we adapt, my colleagues on the council and I have focused on what is possible, and what is necessary,” Earnest said. “It’s also a reality that we have to say ‘no’ more often, more often than in the past, something politicians dislike immensely,”
However, the mayor spoke positively about finding other ways to increase revenue, such as updated clean water fees and sidewalk cafes. He also boasted of Del Mar’s AAA credit rating, which Earnest said is extremely rare for a small city in this economy.
Earlier this year the city prioritized 16 of 40 desired projects to focus on. It recently broke ground on the 21st street sewer pump station, and construction on seismically retrofitting the Torrey Pines Bridge will start later this year.
Earnest, however, expressed concern over the controversial undergrounding ballot measure to be tallied next month, which he said is pitting neighbor against neighbor.
He said the council would have “a very difficult time” determining an appropriate margin of vote for approving construction.
“While undergrounding is the number one priority of our citizens at large, no project should put any homeowner in a position of being forced to sell their home to satisfy project requirements,” he said.
Earnest ended the speech by thanking the community and city staff for their support and hard work. He quoted Winston Churchill’s saying that an optimist sees opportunity in difficulty.
“Del Mar has 50 years of success behind it and many more years of success ahead of it,” he said. “Let’s seize that opportunity and make our town even more special for ourselves and our children.”
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