Commentary: You can “C”

The city of Scotts Valley must maintain its financial stability and health. The magnitude of recent and past budget cuts, along with the associated layoffs, elimination of positions, furloughs and the siphoning off of more than $6.5 million of our tax dollars by the state of California, are facts that cannot be ignored.
For our financial stability and health, I believe it is imperative that we incorporate the continuation of our 2006 voter-approved quarter-cent sales tax, Measure C, into our budget calculations for an additional five years. We, the voters, will ultimately make that decision!
With the above-noted budget cuts and the challenges the city will face in the coming years due to the economic downturn, we will have noticeable changes in the delivery of services to our citizens.
The city of Scotts Valley’s budget reserves are composed of two funds. The first fund, the redevelopment agency, holds revenue reserves of $3.9 million. Those funds are dedicated and legally restricted to specific uses, such as redevelopment projects, paying down debt and our affordable housing fund.
The general fund is the second fund and has revenue reserves of $2.3 million. This money is unrestricted and supports critical services, such as public safety, public works, recreation and parks, and general city services.
If you add the existing deficit of $505,000 to the loss of about $435,000 of Measure C revenues, we will have an annual deficit of $940,000. That means that our $2.3 million general fund reserve will quickly be depleted. Additionally, the often referred to “expected revenues” from the lawsuit with the county of Santa Cruz, which should not be included in a financial forecast until decided by the courts, is estimated to bring in an additional $377,894 from the corrected calculation of property taxes.
If one adds the $377,894 to the approximate $400,000 annual repayment of past property taxes, one sees that it only adds up to $777,894 in additional revenues. These additional revenues still place the city in an approximate $162,106 annual deficit.
Without Measure C sales tax dollars, we might not be able to eliminate furloughs or provide adequate delivery of services.
One must consider, when compiling a financial forecast, that in a 10-year period, the city will no longer receive about $400,000 in annual revenues from the county of Santa Cruz, as the property tax repayment will be complete. That means we might have a $562,106 deficit and once again undergo a notable change in the delivery of services without Measure C and the proactive management of those funds.
Financial forecasting is an excellent way to take a forward look at revenues and expenditures. It identifies financial trends and estimated shortfalls so that a business, or the city of Scotts Valley in this case, can proactively address those issues. It is financially unwise to “wait to see whether things fall through before considering a Measure C renewal” (“Councilwoman pushes for sales tax renewal,” Page 2, Sept. 10).
It is my objective to take a proactive look into the city of Scotts Valley’s financial future by bringing forward to the voters the continuation of Measure C for a five-year period. I cannot idly stand by and continue to place our community and services at risk.
I sincerely appreciate the support of the businesses and individuals who have advocated the continuation of Measure C and would like to thank City Manager Steve Ando for providing the actual accounting numbers.
City Councilwoman Stephany Aguilar has served Scotts Valley since 1996.