Ryan Hagen, Staff Writer
Posted: 02/25/2013 05:50:35 PM PST
GRAND TERRACE – A mid-year budget review to be studied today Tuesday shows an expected deficit of more than $337,000 by the time the fiscal year ends in June, which has led officials to consider declaring a fiscal emergency and asking voters to approve a new tax.
The General Fund deficit – which would eat up 40percent of the fund’s balance – is due to the state Department of Finance stopping the city from paying for various projects through the successor to its redevelopment agency that an earlier budget had counted on, according to a report by city staff.
The city is contesting the Department of Finance’s decision, but the damage can likely be undone only by asking voters to approve new taxes, said Mayor Walt Stanckiewitz.
“Every time we turn around, redevelopment has something denied and that gets shifted to the General Fund,” Stanckiewitz said. “And the General Fund doesn’t have that kind of money. We’ve been on a shoe-string budget for years.”
The bedroom community of 12,000 people historically depended on the redevelopment agency to fund many of its activities because it has few businesses or other revenue sources. A majority of the City Council has described that as a problem they had identified and were fixing before the statewide elimination of redevelopment agencies left them with few options.
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