Calabasas expects a shortfall from state, but all’s not bleak

By Michael Picarella Acorn Staff Writer

In the upcoming fiscal year beginning on July 1, the city of Calabasas must accommodate an additional shortfall of local property tax revenues in the amount of $46,800, according to Calabasas chief financial officer Gary Lysik. But the city will also be short $375,600 this year, he said.

ERAF

In 1992, the state of California enacted legislation that made local governments put a portion of their local property tax revenues into educational revenue augmentation funds (ERAF), according to Lysik. Gov. Arnold Schwarzenegger’s 2004-05 budget calls for an additional $1.3 billion to be put into the fund (for Calabasas an additional $46,800).

VLF

Due to the state’s constant tampering with vehicle license fees (VLF) since 1998, the city of Calabasas and other local governments can expect less money this fiscal year, Lysik said. For Calabasas, the impact is $375,600.

"(That) number is a deferment in revenue receipts for fiscal year 2003-04, not a reduction to total VLF revenue for the city of Calabasas," Lysik said. The state must pay the city its due money by August 2006, he said.

Increases in city revenues

While Calabasas must be frugal with its budget due to the loss of ERAF and VLF monies, Lysik said, the city does expect some additional income.

"There will be an increase in expected revenue in other areas, including property tax," Lysik said. "Calabasas citywide growth increased 9.6 percent for the 2003-04 tax roll, which was 2 percent higher than the increase experienced countrywide at 7.6 percent.

"The largest assessed value increase was reported on three multi-family parcels owned by Casden Malibu Canyon LP," Lysik said. "The $43 million increase in value was the result of a reappraisal due to new construction activity. "

In other words, Calabasas shouldn’t have to cut too many city programs at this time, according to Lysik.

"We will still have to tighten our belts," said Calabasas City Councilman Michael Harrison. The city can’t be as generous as it has been in the past, he said, and can’t do as much work in the city as previously.

City officials don’t know for certain where Calabasas stands financially just yet, according to Lysik. "Within the next few weeks, however, a mid-year budget review will be completed," Lysik said, "and I will be better positioned at that time to provide a snapshot of city finances."