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Santa Clara Maintains Strong Fiscal Management for Latest Fiscal Year

Higher sales tax and transient occupancy taxes contribute to increased revenue for City coffers

Post Date:11/04/2019 2:10 PM

FOR IMMEDIATE RELEASE: Monday, November 4, 2019

CONTACT: Lenka Wright, Director of Communications, 408-615-5515 or lwright@santaclaraca.gov

SANTA CLARA, Calif. – For the fiscal year ending June 30, 2019, the City of Santa Clara’s General Fund ended the year with an additional fund balance of $57.7 million, primarily due to one-time sources or savings. This is among the financial information that the City Council will receive and act upon as part of the Fiscal Year 2018/19 budget year-end report and related budget amendments at the Tuesday, Nov. 5 meeting.

“Over the last two years, the City of Santa Clara has eliminated a forecasted $78 million budget deficit for fiscal years 2018 through 2021, resulting in the preservation of high-quality service levels and saving hundreds of City jobs. This significant accomplishment cannot be overstated,” said City Manager Deanna J. Santana. “The City Council has been strategic in its fiduciary responsibilities and we have implemented those directives responsibly. Through strong fiscal management, the City can continue to put millions of one-time dollars in reserves that can later be drawn from in the event of a downturn in the economy. The budget includes a change in the City’s budgeting basis to align with best practices and government accounting standards. This action continues our efforts to strengthen our fiscal management and increase transparency.”

Revenue was approximately $44.2 million higher than the budgeted estimate of $240.2 million for the Fiscal Year 2018/19 adopted budget. The increase was primarily due to more revenue coming in from the following revenue categories: 

  • Sales Tax 
  • Transient Occupancy Taxes (TOT) 
  • Licenses and Permits (building permits) 
  • Sale of the Great America property 
  • Plan check fees
  • Interest

Revenue from licenses and permits brought in $4.6 million above budgeted estimates due to significantly higher activity with the number of building permits issues.

In contrast, proceeds from property taxes came in roughly $1.7 million lower than the budgeted estimate of $60.3 million. The lower performance is attributed to the negative decision received from Santa Clara County regarding a large property tax possessory interest appeal that involved Levi’s® Stadium. Rent and contribution in lieu revenue categories also brought in lower-than-expected revenues.

During Tuesday’s meeting, the City Council will consider allocating $44.3 million to General Fund reserves and $13.4 million to budget adjustments to cover unanticipated expenses in FY 2019/20.

The recommended budget amendments include: ◦$6.5 million transfer to the Special Liability Insurance fund to replenish required reserve amounts in the fund and fund anticipated payouts;

  • $6.5 million transfer to the Special Liability Insurance fund to replenish required reserve amounts in the fund and fund anticipated payouts;
  • $2.2 million for revised Fair Labor Standards Act (FLSA) overtime calculations and recent settlement for all bargaining units; and
  • $270,000 to fund special election for Chief of Police and ballot measure.
The City Council will also consider a budget amendment to reflect a $2.7 million reduction to the City’s performance rent revenue from non-NFL events at Levi’s Stadium. That’s because non-NFL performance rent is not anticipated to generate any revenue in FY 2019/20.

The General Fund is the City’s major operational fund supporting police, fire, recreational, library and administrative services, programs and activities for our residents.

About the City of Santa Clara
Located at the heart of Silicon Valley about 45 miles south of San Francisco, the City of Santa Clara truly is “The Center of What’s Possible.” Incorporated in 1852, Santa Clara covers an area of 19.3 square miles with an estimated population of 129,488. Santa Clara is home to an extraordinary array of high-tech companies, including Applied Materials, Hewlett-Packard, Intel, Nvidia, Oracle, and Ericsson. The City of Santa Clara is also home to Santa Clara University, California’s Great America Theme Park, and Levi’s® Stadium, home of the San Francisco 49ers and Super Bowl 50. For more information, go to SantaClaraCA.gov.
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