Funding for City Projects Forecasted to be Tight

By Eric Heinz

For at least the last two years, the outlook for money going toward capital improvement projects in San Clemente has been expected to get tighter in the coming years. This, according to city finance officials, is due to rising expenses the city is expected to incur with necessary maintenance to other projects, increasing costs and other factors. All these issues were discussed during the March 2 Long Term Financial Plan (LTFP) meeting.

The city’s general fund money is increasing each year, however, and is expected to continue, especially with the Outlets at San Clemente opening more shops and restaurants, and the Estrella Plaza now mostly filled. But it’s not increasing faster than the anticipated costs.

The city’s reserves are healthy, according to officials, but if the current trends hold, the city will be spending $2 million more of its operating budget than it is expected to make by the 2021-2022 fiscal year.

Assistant City Manager Erik Sund said the city could consider doing studies to either move the current City Hall—which was described as in disrepair—to the city’s offices on Calle Negocio, or to demolish the current building and erect a new one in its place.

The studies to do that, however, would cost a cumulative $550,000. Replacing the current City Hall could also cost tens of millions of dollars.

City officials made it a point during the LTFP meeting to address the Orange County Sheriff’s Department pension costs, which will increase 6.1 percent next year and probably 4.5 percent in years after that. This was negotiated last year among OCSD and the county.

The city’s own pension contributions could also see increases in the next few years.

The city’s budget workshop and public hearing is scheduled for May 22, and that meeting is open to the public. The city is planning to adopt next year’s budget on June 6.

The entirety of the city’s Long Term Financial Plan is available at www.san-clemente.org.

Article updated at 10:05 a.m. on Thursday, March 9, to correct OCSD pension increases.