Steep decline in Property Tax revenue – Budget slashes in Bay Area

One of the consequential damages caused by the foreclosure crisis and housing bubble is depleted market value of properties, resulting in loss of revenue to county administration, through reduced Property Tax collection. There seems to be no escaping, to manage the loss other than by slashing budgets towards welfare expenses – especially education of the kids.

During this week, in Contra Costa County the city council and school board meetings were engaged in this and approved budgets with deep cuts, with impacts concerning services, jobs and welfare programs, affecting tens of thousands of area residents.

The economic down turn and the steep decline in Property Tax revenues have been causing reductions – somewhat deeper into public treasuries, making them shrink rapidly for the past few years. Apart from some cities like Richmond and Brentwood, which had foreseen the deficit and prepared for tougher times, other cities and school districts with multi-million dollar budgets had to swallow the bitter pill of big reductions in staffing and services.

Budget trimming effected in Concord is about $5.5 million and it expects to spend from its reserves nearly $5 millions. The members of the city council took a first step towards putting a tax measure on the November ballot.

The effect of lesser revenue in Antioch is resulting in a shortfall of $2.9 million, which is being managed by ordering layoff of 20 city workers; cut back its recreation department and animal shelter services. According to City Manager Jim Jakel – the city will be left with about 50 city workers, not counting the Police Department.

In Dublin the cut of $1.5 million from its $72.4 million operating and capital improvement budget is going to cost the city – one police officer; fewer hours of work for library patrons and the cancellation in full of the annual Day on the Glen celebration.

In the West Contra Costa school district, where the deficit will be to the tune of $3.2 million next year, the funding looks even tighter for the next two school years. Although the school board’s approved budget this week preserved programs such as class-size reduction in elementary schools and adult education, the district will need to trim $3 million from its 2011-12 budget and another $3 million from the 2012-13 budget.

Posted by Amitesh Kumar on Jun 25 2010. Filed under Economy, Foreclosures, Housing. You can follow any responses to this entry through the RSS 2.0. You can leave a response or trackback to this entry