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City manager Alex Nguyen. (Courtesy photo)
Friday, June 19, 2020

By Chris Frost

chris@tricountysentry.com

 

Oxnard- The City of Oxnard relayed many residents' worst fears during an INCO (Inter Neighborhood Council Meeting) held via Zoom, June 11, and proposed a 2 percent sales tax increase to the voters.

 

The city currently sits at a 7.25 percent sales tax rate, and the change means a 9.25 percent rate if the item passes. 

 

That increase will stay in Oxnard and meet growing demands exasperated by COVID-19, which has bled the city almost dry over the last four months.

 

Seeds to this increase were sewn during the fiscal year 2014-2015 when the city took a $16 million loan from Measure O. 

 

Oxnard authored a deficit spending report year-after-year lasting for 10 years, riddled with deficit spending.

 

To make that budget work, Oxnard needed to make double-digit million-dollar cuts. City Manager Alex Nguyen called it a financial forecast to end the city.

 

INCO Chairman Jack Villa led off the meeting and said that Nguyen, Chief Financial Officer Kevin Riper, Police Chief Scott Whitney, and Fire Chief Darwin Base would lead the discussion.

 

Nguyen said the goal is to achieve budget sustainability so the city can maintain its public service. The city aims for a fully staffed public safety department, properly maintained median, trees, and parks, along with making sure road maintenance is good and 911 response times are solid.

 

"We need to be able to respond to disasters, like the one we are currently in," he said. 

 

At this time in 2019, Oxnard had a $9.2 million budget deficit and made cuts up to $5.3 million.

 

"We were projecting, coming into this fiscal year, only a $2 million deficit, which is a significant improvement from $9.2 million," he said. "At the mid-year, we were in a relatively stable spot. We were prepared to propose a status quo budget for the coming year, which meant no necessary reductions."

 

He reminded the viewers that Oxnard was still in a hole but nearing the top when COVID-19 arrived. 

 

The recession changed everything for everyone, he said, including Oxnard.

 

"It knocked us off our effort to get out of the hole we're in and halted all our progress we've been making here," he said. "For this fiscal year, which only has a few more weeks left, we have an $8.4 million revenue loss."

 

"It's staggering in a sense that it happened over four months," Nguyen said. "For the first eight months of the year, we were doing relatively well."

 

Looking toward the fiscal year 2020-2021, Oxnard currently projects $8 million less revenue than in the fiscal year 2019-2020.

 

"We believe more revenue losses are coming in the new year, starting on July 1," he said. "There are still many unknowns in relation to the pandemic and the economy. Of course, why we have to use the general fund reserve."

 

In 2019, Oxnard had $139.3 million in revenue and expenses of $140.5 million.

 

"The bulk of our revenue comes from taxes, and the bulk of our expenditures go to public safety," he said.

 

Oxnard gets 77 percent of its revenue from taxes.

 

"That is the nature of a public entity," he said. "We are a public entity, not a private entity. "

 

Taxes

 

In a $300,000 home, Nguyen said the owner pays $3,000, and the city receives $528

 

That means the state gets 56.3 percent of your property tax dollar, Ventura County receives 20.3 percent.

 

"The city gets 17.6 percent, and the districts get vetted through the county," he said. "In essence, we get 17.6 percent of property taxes each year.

 

Sales tax

 

With sales tax, the state gets just under 4 percent of each dollar the county gets just over 1.5 percent, Oxnard gets 1 percent plus .5 percent from Measure O, which expires in March 2029. There is also .5 percent for proposition 172 and .25 percent for county transportation.

 

Right now, we get 1.5 percent," he said. "If you buy a $20 shirt in Oxnard, you will be taxed $1.55, and the City of Oxnard gets.30 cents."

 

Restricted funds

 

That money is broken up into utilities, grants, special taxes, and assessments, and bond proceeds.

 

Regardless of how much money is in here, these funds can't be used for general fund expenses," Nguyen said. "They are all restricted."

 

The rainy-day fund goal in the general fund is 12 percent, he said, while there is a 25 percent goal in the utility fund. 

 

"The city has been experiencing budget cuts, year over year since 2015," he said.  

 

That means overgrown medians, potholes in the streets, and browning parks. With the city's current revenue situation, staff can tend to the medians once a year, while Nguyen said they should take care of them once a month.

 

To maintain the roads, Oxnard needs to budget $13.5 million each year, but it can only budget $11.5 million.

 

"Many of our parks look brown," he said. "Not only have we stopped our regular mowing, but we also had to cut the watering in half so we could save money."

 

Cultural and Community Services have experienced severe cuts, including closing the Carnegie Art Museum.

 

"We do hope that will be reopened at some point in the near future," he said.  

 

"We're all aware of this, and some of our staff are embarrassed by this," he said. "Library services, the Police Athletic League (PAL), and senior services have been cut."

 

Since 2015, Community Services has experienced a $5 million cut.

 

"That's a lowering of services to the community," he said. 

 

Nguyen worries about reassigning 13 officers from neighborhood policing to regular patrol.

 

"This is our most effective and best opportunity to improve police and community relations," he said. "The chief and I hope we can get back on back on track financially and restore and expand neighborhood policing."

 

 

This story will continue on June 26.