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City of La Palma
7822 Walker Street
La Palma, CA 90623
Ph: (714) 690-3300
Fx: (714) 523-2141
-I heard that the utility users’ tax was for services which are now being cut, but the tax is being retained. Why is this happening?
The utility user tax (UUT) was approved in 1993 and was confirmed by La Palma voters in 2002 following the change in State law requiring voter approval. It is a General Fund revenue that can be used for any General Fund purpose. The rate is reviewed by the City Council annually and can be set lower than the voter approved 5% maximum. The UUT produces about $1.0 million annually, or about 14% of total General Fund revenues.
When the measure went to the voters in 2002, staff developed a 15% budget reduction plan which would have preserved services mandated by law had the measure failed. Had the measure not passed, the likely service reductions being considered included:
• Reduction in Recreation Services - contracting out the Tiny Tots program, elimination of the youth basketball program, elimination of the Holiday Tree Lighting and Memorial Day events, reduction of summer concerts to 4, elimination of the July 4 Fitness Run for Fun, modification of La Palma Days, elimination of the volunteer recognition event, reduced operating hours for the Community Center, reduction in number of recreation brochure publications, reducing staff training and development, reduction of 3 full time Recreation Department staff and six to twelve part time Recreation Department staff
• Reduction in Public Works - reduced maintenance of City parks, the SCE Right-of-Way, medians, and street trees, suspension of evening programs at the park requiring lighting; elimination of lighting on SCE Right-of-Way, less trimming of street trees
• Reduction in Administration and Planning - eliminate financial support to outside agencies, including the La Palma Library, the Chamber of Commerce, and the Orange County Human Relations Commission; reduction of document imaging; cut back enforcement of business license compliance; reduction of legal services, elimination of travel for City Council and City manager training; elimination of Building Technician position; elimination of part time contract inspection services; reduction of planning/building counter hours; elimination of Executive assistant; reduction of full time Management Analyst to part time; elimination of part time planning intern; reduction of facility maintenance, and reduction of information technology contract
• Reduction of Police Services - elimination of DARE program, school resource officer program, Volunteers in Policing, Citizens Academy, Business Outreach Program; reduction of services in police records, code enforcement, elimination of park ranger program and reserve officer program; elimination of disaster preparedness program and elimination of staff support for Neighborhood Watch; Reduction in Police staffing by 4 sworn positions, 5 non sworn positions, and 5 reserve officers
However, the UUT was never dedicated to those or any other services. As a general revenue, the $1.0 million received annually goes to support all of the services residents have come to depend on and enjoy: public safety, street maintenance, parks, etc. Reduction or elimination of the UUT would increase the gap in the general fund and require more reductions in services than currently proposed.

FY2013-14 Budget Planning

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1. -Why has the City’s financial situation changed so much?
2. -Weren’t we ok financially before BP/Arco located to La Palma? Why can’t we just cut back to the level of employees and services we provided back then?
3. -Isn’t this a short term problem and once we start getting sales tax from Tesoro and other new businesses we will be financially healthy again?
4. -Doesn’t the City have significant reserves it can use instead of cutting services?
5. -Why don’t employees just accept less in their compensation so that these service reductions are not needed?
6. -I heard that the utility users’ tax was for services which are now being cut, but the tax is being retained. Why is this happening?
7. -Why is closing the funding gap all being done by reducing services to residents, can’t the City close the gap in other ways?
8. -I have heard the City is laying off dispatchers and police officers and contracting police with another agency. Shouldn’t public safety be our highest priority?
9. -How does contracting out services like police dispatch save money?
10. -What is the service impact of contracting out a service or function?
11. -If there is a financial issue, why are we spending money on capital projects instead of on staffing or services?
12. -Aren’t there ways to increase revenues that would save services?
13. -How can I be a part of the conversation on budgets and services?