The Guadalupe City Council will
defend itself Tuesday night against a recommendation by a Santa Barbara County
grand jury that the city should disincorporate due to numerous financial issues.
The grand jury presented 13
findings in a report titled “Guadalupe Shell Game Must End,” which led them to
make the recommendation for Guadalupe to disincorporate. Of the 13, the council
disagreed with eight, partially disagreed with three and agreed with two.
“The recommendation will not be
implemented because it is not warranted, and it is not reasonable,” the council
wrote in its official response.
Examples of the grand jury’s
findings include the city’s inability to generate enough General Fund revenue
to pay for expenses, inability to build up a reserve fund for emergencies and
infrastructure repair and a history of inappropriate transfers of funds to
cover its debts.
One of the biggest financial
obstacles for the city to overcome is a negative General Fund balance of more
than $300,000. But the council says it has a plan.
It will borrow from its own
Water Operating Fund and Lighting District to cover the deficit, a loan, with
interest, which will take a predicted 10 years to pay back.
In November 2014, Guadalupe
voters passed three tax measures that will create $325,000 in additional
revenue, according to the council. One of the measures included a .25-percent
sales tax increase.
The city also expects $100,000
in new revenue from property and sales tax and business permits associated with
800-home Pasadera development, which broke ground in March.
The city also raised sewer
rates by 30 percent and garbage rates by 19 percent to help cover
deficits.
The council hopes these
extensive efforts will be enough to satisfy the grand jury. Its report also
mentions safety concerns as a reason Guadalupe should not disincorporate.
“This is not just a matter of
small town pride,” the council wrote. “It also has to do with public safety.
Guadalupe residents want to make sure that police and fire protection are
provided from within city limits.”
At its Tuesday meeting, the
council will also accept the results of an audit conducted by Glenn Burdette
Attest Corporation for the 2013-14 fiscal year. The auditors “raise substantial
doubt about the city’s ability to continue as a goring concern.”
But the council insists its
efforts to cover the city's deficits, including the loan from the Water Fund
and the Lighting District, will be enough to present a balanced budget for
2015-16.
The meeting will take place at
6 p.m. in the council chambers of City Hall, 918 Obsipo St., Guadalupe.
May
25, 2015
Lompoc
Record
By Abby Hamblin
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