CC SR 20200519 K - COVID-19 Govenor Newsom Letter
RANCHO PALOS VERDES CITY COUNCIL MEETING DATE: 05/19/2020
AGENDA REPORT AGENDA HEADING: Consent Calendar
AGENDA DESCRIPTION:
Consideration and possible action to authorize the Mayor to sign a letter to Governor
Newsom requesting funding to address COVID-19 impacts to cities.
RECOMMENDED COUNCIL ACTION:
(1) Authorize the Mayor to sign a letter to Governor Newsom requesting funding to
address COVID-19 impacts to cities.
FISCAL IMPACT: None
Amount Budgeted: N/A
Additional Appropriation: N/A
Account Number(s): N/A
ORIGINATED BY: Megan Barnes, Senior Administrative Analyst
REVIEWED BY: Same as below
APPROVED BY: Ara Mihranian, AICP, City Manager
ATTACHED SUPPORTING DOCUMENTS:
A. Draft letter requesting funding to address COVID-19 impacts to cities
(page A-1)
BACKGROUND AND DISCUSSION:
According to a League of California Cities analysis, California cities are facing a nearly
$7 billion revenue shortfall over the next two years due to the COVID-19 pandemic. This
shortfall grows by billions of dollars as modified stay-at-home orders extend into the
summer months and beyond. Cities have also been incurring significant increases in
unbudgeted expenses responding to the crisis. COVID-19 has crippled local budgets,
forcing cuts in city services and city employees, which will dampen local econom ic
recovery.
In the face of these budget shortfalls, nine out of 10 cities report they will have to cut
staff or decrease city services to residents, and nearly 3 in 4 cities report they may have
to take both actions. Police services will be impacted in 84% of cities, more than half of
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cities’ fire services will be adversely impacted, and fewer firefighters and police officers
will be available to respond to emergency calls.
As the City Council is aware, Staff anticipates the COVID-19 pandemic could potentially
cost Rancho Palos Verdes $2.6 million in revenue loss in Fiscal Year 2019-20 and
nearly $3.3 million in FY 2020-21, with the most significant impact being the projected
loss of transient occupancy tax (TOT) revenue (about $1.3 million for FY 19-20, and
$1.9 million in FY 20-21). Over 96% of the City’s TOT revenue comes from Terranea
Resort, which temporarily closed in late March. The City’s TOT revenue largely funds
Capital Improvement Program (CIP) projects and public safety rate increases.
A grassroots coalition of local government, labor, and business is launching a new
campaign “Support Local Recovery: Vibrant Cities. Strong Economies.” in an effort to
kick start economic recovery in local communities. The coalition is calling on the state to
provide $7 billion in direct and flexible funding to cities to support critical local services,
as well as a portion of the state’s CARES Act funding to help cities address COVID-19
related expenditures. The coalition is also calling on the federal government to provide
$500 billion in direct and flexible funding to local governments nationwide to support
essential services, including police, fire, public works, permitting, and planning.
The League of California Cities has asked cities to send letters to Governor Newsom
requesting this aid, and Staff has prepared a draft letter (Attachment A) for the Council’s
consideration. Given the financial impact of the pandemic on the City, and the need for
relief, Staff recommends the City Council authorize the Mayor to sign the letter.
ALTERNATIVES:
In addition to the Staff recommendation, the following alternative action is available for
the City Council’s consideration:
1. Do not authorize the Mayor to sign the letter to Governor Newsom requesting
funding to address COVID-19 impacts to cities.
2. Take other action as deemed appropriate by the City Council
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May 19, 2020 Via Email
The Honorable Gavin Newsom
Governor, State of California
State Capitol
Sacramento, CA 95814
SUBJECT: Request for Funding to Address COVID-19 Impacts to Cities
Dear Governor Newsom:
The City of Rancho Palos Verdes thanks you for your leadership and efforts to protect
and support Californians during this unprecedented public health crisis. Cities remain on
the front line helping residents stay safe and in their homes, delivering emergency
services, and supporting local businesses and community organizations. However, as
emergency costs continue to grow, city revenues to fund local services are plummeting.
COVID-19 is having devastating impacts on city budgets and services statewide.
Based on the League of California Cities analysis, California cities are projecting a
nearly
$7 billion general revenue shortfall over the next two fiscal years. This shortfall will
grow by billions of dollars if stay-at-home orders to protect public health extend into the
summer months and beyond.
The City of Rancho Palos Verdes projects that these shortfalls will impact our core city
services, including infrastructure capital projects, public safety, and core city services for
residents, as well as the employees.
Since the beginning of the COVID-19 crisis, the City of Rancho Palos Verdes has
stepped up to protect and serve our community, purchasing equipment and supplies to
keep residents and employees safe, and performing robust community outreach
A-1
Governor Gavin Newsom
May 19, 2020
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regarding resources and services. The necessary measures our city has taken are
costly. In order to continue to be a full partner with the state in saving lives, protecting
our communities, and ultimately recovering from this crisis, we need your help.
The City of Rancho Palos Verdes has joined the Support Local Recovery coalition and
we are calling on you to immediately support the following actions:
Provide $7 billion in direct and flexible state funding to support critical local
services and allocate CARES Act funding for all cities for COVID-19-related
expenditures.
Advocate to secure $500 billion in direct and flexible funding from the
federal government for all cities nationwide to support critical local services.
The City of Rancho Palos Verdes appreciates your consideration of our requests and
look forward to further discussing in the coming days how together we can continue to
best protect Californians and reopen our economy. Thank you again for your leadership
and partnership during these uncertain times.
Sincerely,
John Cruikshank
Mayor
cc: Ted Lieu, U.S. Representative, 33rd Congressional District
Dianne Feinstein, U.S. Senator, California
Kamala Harris, U.S. Senator, California
Ben Allen, Senator, 26th State Senate District
Al Muratsuchi, Assembly Member, 66th Assembly District
Janice Hahn, L.A. County Supervisor, 4th District
Bismarck Obando, League of California Cities
Jeff Kiernan, League of California Cities
Meg Desmond, League of California Cities
Marcel Rodarte, California Contract Cities Association
Rancho Palos Verdes City Council
Ara Mihranian, City Manager
A-2