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Facing budget shortfalls, local cities join statewide coalition to lobby for disaster relief

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San Luis Obispo County cities are hurting from the coronavirus pandemic.

Revenues like sales taxes and bed taxes, normally buoyed by Cal Poly students and tourism at this time of year, have vaporized with the current shelter-at-home orders. City officials across the county are now grappling with the budget implications.

"The financial impacts have been significant," said Greg Hermann, deputy city manager for SLO, a city that's forecasting a $15 million revenue shortfall between the current and the 2020-21 fiscal years. That number could easily grow if the pandemic orders continue longer than expected.

BUDGET TROUBLE San Luis Obispo and cities throughout the Central Coast are grappling with multi-million-dollar revenue shortfalls as a result of COVID-19. - FILE PHOTO BY KAORI FUNAHASHI
  • File Photo By Kaori Funahashi
  • BUDGET TROUBLE San Luis Obispo and cities throughout the Central Coast are grappling with multi-million-dollar revenue shortfalls as a result of COVID-19.

For cities and counties, less revenue means fewer dollars to fix roads and infrastructure, fund police and fire departments, and provide all of the other services that local governments are expected to perform.

"Without those services, then our quality of life is going to suffer across the board," said David Mullinax, regional public affairs manager for the League of California Cities, an organization that goes to bat for city interests in the state Capitol.

SLO County's cities are by no means alone in their challenges. According to a recent League of Cities survey measuring the city budget crunches statewide, municipalities are in a $7 billion collective hole thanks to COVID-19. The crisis has sparked the Support Local Recovery initiative, aimed at lobbying the state and federal governments for local disaster relief.

"We asked the governor, 'Hey, we need help,'" Mullinax told New Times about the initiative. "We had almost 300 responses [to the survey] ... big cities, small cities ... some real data points to avail ourselves of. The number we came up with was $7 billion."

Mullinax said that cities heavily reliant on tourism, like Paso Robles and Pismo Beach in SLO County, have been particularly impacted by the stay-at-home orders and need the relief.

"They got clobbered," he said.

The League of Cities campaign is just kicking off, but many of the local cities are jumping on board. As of May 18, SLO, Paso Robles, Atascadero, and Grover Beach confirmed they'd signed on.

Local officials said that the initiative—which also calls for $500 billion from Congress in its next stimulus bill—could go a long way if successful.

"There are many ways that aid could help us," Paso Robles City Manager Tom Frutchey told New Times. "The most basic is to replace some of our lost revenues so we don't have to cut needed services that the community needs and has come to expect. As a no/low property tax city, we are always a hair's breadth away from having to make cuts."

While cities are hurting right now, so are most sectors of government and the economy. Mullinax noted that the wide scope of the crisis will complicate the cities' lobbying efforts, as Gov. Gavin Newsom and state lawmakers weigh other interests while also tackling a $54 billion projected state budget deficit.

"We're standing in line with a lot of people," Mullinax said. "It takes a lot to penetrate that bubble. You have to constantly remind them of what our challenges are."

Fast facts

Local tech company Comevo recently pitched in $75,000 to start the SLO County Small Business Relief Fund, a fund providing $5,000 or more in grants to local businesses "disproportionately impacted by COVID-19," according to the SLO Chamber of Commerce. The application window for the first round of grants closed on May 14, but the chamber is asking other businesses to make contributions to the fund. "We have seen an overwhelming response [to the fund], with hundreds of applications received," a chamber press release read. "Unfortunately, this round of funding will not be able to provide aid to every business that applied, but if additional funds do become available, we will maintain these applications for subsequent grant opportunities."

About 400 drive-through orders at Fin's Seafood Restaurant in Grover Beach raised more than $10,000 for the 5 Cities Homeless Coalition (5CHC) on May 12. The fundraiser took place as 5CHC receives nearly twice as many calls for help during the COVID-19 crisis. Fin's is currently open for take-out on Fridays, Saturdays, and Sundays, from noon to 7 p.m. Δ

Assistant Editor Peter Johnson wrote this week's Strokes and Plugs. Send tidbits to strokes@newtimesslo.com.

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