Escondido could lose $2.1 million from state

By: ERIN MASSEY - Staff Writer | Tuesday, January 13, 2004 11:27 PM PST ∞

ESCONDIDO ---- Like all cities, Escondido is going to lose property tax funds ---- to the tune of $613,000, in this case ---- if the governor's budget proposal is passed this summer.

But unlike some other municipalities, Escondido also stands to lose nearly $1.5 million in state funds next fiscal year due to losses in redevelopment money, transportation and booking fees for county jails.

Still, the combined loss of $2.1 million, which amounts to a 3 percent loss to the city's current $64 million operating budget, is not as bad as it could be, officials said.

Gov. Arnold Schwarzenegger's budget proposal includes $4 billion to local governments for restored vehicle license fees, while taking $1.3 billion in property taxes.

"Enough is enough," said City Manager Clay Phillips on Tuesday. "The cities are getting tired of watching the state and school budgets continue to grow and yet there is no growth for the cities."

Schwarzenegger's proposal, released last week, would take Escondido's $613,000 in property taxes.

The governor's office says the money will be funneled to the Educational Revenue Augmentation Fund to benefit schools.

"The shift of money from cities to the schools started in 1992 and has been increasing in an ongoing basis," said Gil Rojas, the city's finance director. "What people forget about is the $613,000 is added to $2.7 million that has been taken since 1992."

Along with the $3.3 million in local property taxes that has shifted from the city to Sacramento since 1992, the state has taken $2.3 million in revenues from the city's redevelopment agency.

The redevelopment agency has been tapped out for several years, after paying for the construction of City Hall in 1988 and the California Center for the Arts, Escondido complex, which opened nine years ago.

That means Escondido's general fund, on behalf of the redevelopment agency, will lose an additional $695,000 to the state in the fiscal year starting July 1, Rojas said.

Mayor Lori Pfeiler said the budget proposal contradicts the governor's campaign promise that he will help local governments.

"There is this concept of making cities whole ... but then you produce a budget that takes away $1.3 billion in property taxes," Pfeiler said. "It is still money coming from cities. You can't do that and say you are keeping cities whole."

Schwarzenegger's budget also continues the suspension of Proposition 42, transferring gas tax funds from transportation programs to the state's general fund. Begun by the Davis administration for the current budget year, the continued suspension would mean a loss of $179 million statewide for local road projects next year.

In Escondido, the suspension means the city loses about $250,000 a year to fix roads and ease traffic congestion.

"Because we weren't very confident in that money, we didn't budget it for this fiscal year," Rojas said. "We were waiting until we saw the check in the mail. Now, we will have to maintain our streets using other money."

Escondido could lose an additional $550,000 in state reimbursement for booking fees the county charges the city to jail suspects arrested in the city limits, Phillips said. But the actual cost is unclear. Currently, the county charges cities booking fees and the state reimburses cities for the cost. Schwarzenegger's budget doesn't include that reimbursement. There is speculation that the state won't allow the county to charge cities for booking, so Escondido could escape without losing any money, Rojas added.

Contact staff writer Erin Massey at (760) 740-5416 or emassey@nctimes.com.

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