Laguna needs long-term financial plan

A sales tax increase should be approved -- with one important

condition.

Laguna Beach’s latest calamity not only exposed Bluebird Canyon,

it also exposed the city’s weak financial status. The City Council

can correct this problem only by developing, adopting and adhering to

a comprehensive long-term financial plan. The process needs to start

with a thorough evaluation of the city’s short- and long-term

financial needs into the foreseeable future, at least 20 years. This

includes everything from risk management to projected costs for

capital projects to repairing our decaying sewer and storm-drain

systems, streets and other infrastructure. Establishing these goals

must be based upon the most accurate information available, balanced

with all projected revenue sources.

For example, the projected costs for street, curb, gutter and

sidewalk repairs and replacement should be based upon a comprehensive

street and sidewalk assessment program. Such a financial plan would

include a policy to set aside a specific amount of money each year --

to be deposited into a dedicated emergency reserve fund -- with the

goal of building the fund to a specific percentage of the adopted

general fund budget.

Most cities establish a goal of between 8% and 15% of their

general fund budgets. It would be wise for our city to set the

emergency reserve fund goal at the higher end of the scale, given

Laguna’s history of floods, landslides and fires. Once a long-term

financial plan is adopted, the council would evaluate how it was

doing to achieve its financial goals as it considers the proposed

budget each year. This process helps to take financial decisions out

of a crisis mode to a mode of more thoughtful deliberation. Decisions

are only as good as the information upon which they are based.

A keystone to starting the process is gathering input from the

public, possibly through a citywide questionnaire, and analysis of

issues by staff. This process will require a commitment of a

significant amount of staff and council time, and it will likely take

one to two years to develop. Once developed, the plan is updated

annually to reflect updated information and emerging issues not

anticipated.

This process was adopted by the City of San Clemente almost 14

years ago, and it has been extremely successful. San Clemente has

been transformed from a rundown, financially strapped community with

notoriously potholed streets and a decaying storm drain system into a

financially healthy one with miles of new streets, improved

streetscapes, storm drains and other revitalization projects. All

levels of public service have been dramatically improved, including

public safety and recreation services.

San Clemente was able to accomplish this largely as a bedroom

community, without the benefit of the tremendous tourist tax base of

Laguna Beach. This process will demand discipline and financial

constraint on the part of the current council and future councils.

The payoffs will be incredible in terms of avoiding the costly

problems of crisis management and continually having to change

priorities.

The current financial crisis is requiring many city projects to be

postponed or shelved indefinitely, such as the community-senior

center, lifeguard headquarters repairs and the completion of a

database of city records after a $100,000 investment. Derailment of

such projects is costly and upsetting to the many people who have

been patiently waiting for something of interest to them to get done.

This must be especially upsetting to the many people who have gone to

tremendous lengths to raise funds for the community’s senior center.

I, for one, believe that the potential sale of the approximately

$2 million city property currently leased to the Girl Scouts for $1

per year should be placed back on the table. To sell the property

does not mean that the Girl Scouts cannot still function or that the

city would not work with them to find an alternative place for them

to meet. For the Girl Scouts’ parents to hide behind the notion that

the city should not sell its property is a sham. Cities buy and sell

property all the time. There is nothing sacred about our city selling

its land for the good of the community.

How can we further delay building the community-senior center and

other important projects because the council caved in to the

pressures of the Girl Scouts’ parents? I would hope that these

parents would show more understanding for the needs of others within

the community. The general citizenry that will use this new facility

will greatly outnumber the relatively small number of Laguna Beach

and out-of-town Girl Scouts that use the leased property.

Council, I will support a sales tax increase with a sunset clause,

if you agree to implement and adhere to a responsible long-term

financial plan that includes consideration of the sale of the land

currently leased to the Girl Scouts. I suspect that taxpayers will be

more likely to agree to future tax increases or special assessments

if they recognized that the council was being financially responsible

while trying to meet the community’s needs.

o7Lynn Hughes lives in Laguna Beach.

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