Politics & Government

South Gate Approves Budget with Deficit

The council was one vote away from being unanimous in their decision.

Las night, the South Gate City Council voted 4 to 1 in favor of the proposed budget plan presented by , the city’s Finance Director, for the 2012 to 2013 fiscal year. South Gate’s general fund, the city's primary operating account,  is forecasted to receive $35.2 million in total revenue, and expects to spend $37.9 million. 

"Expenditures are still outstripping revenues,” said Cook.  “Sales tax revenue has not reached the same level as it was in 2007 to 2008.”

Find out what's happening in South Gate-Lynwoodwith free, real-time updates from Patch.

The city projects to have a deficit of 1.6 to 2 million dollars, as a result of a weak economy, but mostly because of the elimination of redevelopment agency funds.

“The elimination of redevelopment has created an operations deficit,” said Cook.

Find out what's happening in South Gate-Lynwoodwith free, real-time updates from Patch.

South Gate’s overall projected revenues for the following year, are at $110 million, which is also smaller than the $129 million in forecasted expenditure. However, Cook insists that the general fund is a better indicator of the state of financial affairs of South Gate.

“The general fund takes in sales tax and vehicle license fees, as well as property tax value,” said Cook, since the overall revenues will include federal grants and funds that are not tied to the municipal economy. “This is the simplest way to gage what is happening the community. ”

Councilmember Henry Gonzalez was the only member of the council that voted against the budget.

“I do not think we should vote for this budget right now,” said Gonzalez, who believed that the city needed to meet some of its financial obligations, such as its role in the financing of the Azalea project, before moving on with it.

The other members of council did not agree with Gonzalez.

The fluidity of the budget, and the quarterly presentations that are expected to be made by the finance director gave South Gate's Mayor, Bill De Witt, the belief that it was better to start now.

“We need to move this ahead and get this approved,” said De Witt. “The budget is a guide that can be revised up or down depending on the conditions we get each quarter.”

South Gate can currently afford to handle the deficit under the current projections because of the savings that it has. However, South Gate could lose its savings for the following fiscal year if things do not recover, and as a result have a negative fund balance.

“We will be relying on these reserves to get us through this fiscal year of 2012-2013,” said Cook. “This is because of the decisions of the council to maintain a level of service, and to not hit city employees with additional cuts in compensation.”

Keep up with South Gate Patch Latino by subscribing to breaking news alerts, liking us on Facebook and following us on Twitter. Have an event or announcement you'd like to publicize? Submit them for free. 


Get more local news delivered straight to your inbox. Sign up for free Patch newsletters and alerts.

We’ve removed the ability to reply as we work to make improvements. Learn more here

More from South Gate-Lynwood