San Mateo expects more favorable general fund revenue this year than previously anticipated because of improved tax revenue performance, with the City Council voting to use the $13.6 million surplus to pay employees’ salaries and city projects.
Rich Lee
The general fund total revenue for the 2021-2022 fiscal year is now expected to be $160.2 million, while the city projects total expenditures at $146.6 million, a $13.6 million surplus. A January estimation initially projected $155.2 million in total revenue and the same total costs. The $5 million revenue increase came from more real property transfer tax and transient occupancy tax. San Mateo has rising real estate values and several significant commercial property sales since its January budget update, adding $3 million in revenue estimates. TOT revenue is projected at $3 million in 2022, two million more than the adopted 2021-2022 budget. However, TOT revenue is not back to its pre-pandemic number of $7 million.
At its April 18 regular meeting, the council voted to commit $5.5 million for the cost of negotiated increases in employee salaries and benefits and $4.5 million to serve as a funding source for capital improvement projects. The funding will allocate $1.6 million to complete the high voltage streetlight conversion, $1.8 million for the Marina Library structural improvements, and $600,000 for pedestrian mall construction downtown between First and Third avenues on B Street.
According to a city staff report, San Mateo is also looking at better tax revenue numbers in its anticipated 2022-2023 fiscal year budget. Property tax revenue will remain a key driver, projected at $79.6 million for 2022-23, which is $13.4 million, or 20.3%, more than the adopted 2021-22 budget. Sales tax will be $3.1 million more at $22.4 million, with Measure S sales tax at $7 million. The increases show a faster economic recovery than expected of around two years, which the city initially anticipated at three to four years. San Mateo is expecting $159.1 million in total general fund revenue but still faces total expenditures of $165 million, an increase of $18.1 million, or 12.3%. The city said that most costs are due to city salaries and benefits projected at $85.3 million, an increase of $10.5 million or 14.1%. The increases are due to negotiations with employees and expected increases in health care premiums costs.
Recommended for you
“For a municipality, that is our primary charge, providing service to the San Mateo community, so it makes sense that a majority of our operating budget is for salaries and benefits,” Finance Director Rich Lee said.
The council praised Lee and City Manager Drew Corbett for guiding the city through the pandemic and allocating money to the workers and public projects.
“Our community members will see and experience the benefits of those investments. I feel really confident that we are putting our money in the right places,” Councilmember Amourence Lee said.
So SM has a $13.6 million surplus and 40% of this surplus is going to pay for employee salaries and benefits? Essentially saying San Mateo has been deficit spending? Hey voters, imagine depositing $100 at the bank, but sorry, you only get a $60 credit. Voters, remember this the next time you see a tax increase, and trust me, you’ll see plenty of tax increases coming up, because chances are, San Mateo will continue to deficit spend and they need the gravy train to keep rolling. And the council is praising Lee and Corbett? For what? Deficit spending? Anybody can do that. I’ll do that for free, saving you from feathering my retirement fund.
Keep the discussion civilized. Absolutely NO
personal attacks or insults directed toward writers, nor others who
make comments. Keep it clean. Please avoid obscene, vulgar, lewd,
racist or sexually-oriented language. Don't threaten. Threats of harming another
person will not be tolerated. Be truthful. Don't knowingly lie about anyone
or anything. Be proactive. Use the 'Report' link on
each comment to let us know of abusive posts. PLEASE TURN OFF YOUR CAPS LOCK. Anyone violating these rules will be issued a
warning. After the warning, comment privileges can be
revoked.
Please purchase a Premium Subscription to continue reading.
To continue, please log in, or sign up for a new account.
We offer one free story view per month. If you register for an account, you will get two additional story views. After those three total views, we ask that you support us with a subscription.
A subscription to our digital content is so much more than just access to our valuable content. It means you’re helping to support a local community institution that has, from its very start, supported the betterment of our society. Thank you very much!
(1) comment
So SM has a $13.6 million surplus and 40% of this surplus is going to pay for employee salaries and benefits? Essentially saying San Mateo has been deficit spending? Hey voters, imagine depositing $100 at the bank, but sorry, you only get a $60 credit. Voters, remember this the next time you see a tax increase, and trust me, you’ll see plenty of tax increases coming up, because chances are, San Mateo will continue to deficit spend and they need the gravy train to keep rolling. And the council is praising Lee and Corbett? For what? Deficit spending? Anybody can do that. I’ll do that for free, saving you from feathering my retirement fund.
Welcome to the discussion.
Log In
Keep the discussion civilized. Absolutely NO personal attacks or insults directed toward writers, nor others who make comments.
Keep it clean. Please avoid obscene, vulgar, lewd, racist or sexually-oriented language.
Don't threaten. Threats of harming another person will not be tolerated.
Be truthful. Don't knowingly lie about anyone or anything.
Be proactive. Use the 'Report' link on each comment to let us know of abusive posts.
PLEASE TURN OFF YOUR CAPS LOCK.
Anyone violating these rules will be issued a warning. After the warning, comment privileges can be revoked.