DEL MAR — By learning to do more with less, prioritizing projects and knowing it can count on community support, Del Mar “not only survives, but continues to improve the quality of life for its citizens,” Mayor Richard Earnest said March 8 during the annual State of the City address.
One of California’s smallest cities, and the smallest one in the county, Del Mar “has identified ways to increase city revenues, maximize efficiencies and decrease costs” despite local governments suffering their worst revenue losses in decades and a state deficit that is the largest in the nation, Earnest said.
“There’s a lot going on at City Hall to preserve the Del Mar ambiance and feel that we all find so precious,” he said. “In the past two years, managing the city budget has sort of been akin to catching a falling knife.”
Del Mar has seen significant declines in sales and transient occupancy tax, two of its major income sources. It has also experienced reductions in other tourist-based revenues such as parking meters and parking violations.
Earnest said the sluggish economy has impacted development, resulting in declines in building and engineering fees, although some of those losses are offset by a decrease in expenditures.
Fortunately, property taxes, the city’s largest revenue source, experienced an 8.4 percent increase in the past year — the highest in the county, he said.
This time of declining revenues coincides with increased expenditures, such as the Shores property maintenance and debt and the growing cost of public safety. The cost to provide services to the Del Mar Fairgrounds also continues to rise while revenues from the state-owned site decline.
“The dialogue with the fairgrounds continues in an effort to this reconcile this imbalance,” Earnest said.
Other challenges include replacing “aging, decrepit and obsolete” city facilities such as City Hall, the lifeguard tower and the public works facility, which provide staff with “substandard work areas and a poor environment in which to serve the public,” he said.
“Future downward economic projections have required the city to look at every expense line item for savings,” Earnest said.” We’ve partnered with our staff and with our community groups to manage this financial storm.”
Staff members agreed to forgo raises. Vacant positions have been eliminated or remain unfilled. Maintenance has been deferred on all noncritical items, and equipment purchases have been delayed “until absolutely essential,” he said.
False alarm, planning and development and Clean Water Act fees were updated. The city contracted with new firms for legal and engineering services. Fire services were consolidated with three neighboring cities. An ordinance allowing sidewalk cafes was adopted and has already resulted in “increased economic vitality,” Earnest said.
“We simply are making the decisions that are practical … and doing this in a business-like way with an eye toward continuing service to the community while saving taxpayers’ money,” he said.
Council members prioritized a list of 40 significant projects and identified 16 as the most critical to complete. They include the North Torrey Pines Bridge and 21st Street sewer pump station.
In 2008, voters approved an increase in the transient occupancy tax. In June, they will decide whether that tax should apply to vacation rentals. “This is one step in a long journey to get beach visitors to pay their share in the preservation of our beaches and our parks,” Earnest said.
In conclusion, the mayor thanked his colleagues for their “service and vision in crafting our current path to success,” City Manager Karen Brust and her staff for “invaluable guidance, hard work and expertise” and the community for its public participation, long hours of volunteerism and financial support that help “define Del Mar as the unique community that it is.”
“Without you, we simply couldn’t do it,” he said.