Item 32 - Provide Direction for FY 2021-22 Budget

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Provide Direction for FY21-22 Budget March 16, 2021 Page 2 As of the Midyear Budget Update, the estimated available General Fund balance at June 30, 2021 is $13,846,139. DISCUSSION The FY 2021-22 budget process kicked -off in November and the City Council approved a budget calendar on December 15, 2020. Staff has been busy compiling a draft budget, and meetings between the City Manager and Directors will occur this month to review department -proposed changes. The draft budget will include support for Strategic Plan Goals. Strategic Plan Goals On June 16, 2020, the City Council adopted the Five -Year Strategic Plan. On February 12, 2021, the City Council met in closed session and created additional Strategic Goals for the City Manager to address. The Strategic Plan Priorities and new additions to goals follow. Strategic Plan Priorities NEW Goals Added Financial Stability Community Safety . School Partnerships Modern Facilities & Infrastructure . Bridge Digital Divide Efficient City Services Economic Diversification & Expansion . Address Housing Challenges • Parks, Open Space & Amenities Staff will develop additional performance measures as necessary, and any proposed increases to FY 2021-22 spending will support one or more Strategic Plan Goals. American Rescue Plan Act of 2021 & Economic Outlook The federal stimulus package includes a $350 billion Coronavirus State Local Fiscal Relief Fund that would provide approximately $65 billion in direct and flexible funding to cities for pandemic response and revenue replacement. The current estimate for the City's allocation is $143 million. The funding will be critical for recovery as we emerge from the pandemic. The City will receive the first allocation within 60 days after enactment. The City must spend the federal funding by December 31, 2024. Similar to the CARES Act, staff will develop a draft plan for "Revive Santa Ana" and return to City Council when we have more information on the federal spending guidelines. The public will have an opportunity to provide initial input during the Community Budget meeting on March 25. UCLA Anderson Forecast recently released its projections for the California economy, including 2022 statewide increases of 2.4% for CPI, 1.6% for taxable sales, and 2.9% for residential building permits. Although the overall outlook is positive, UCLA Anderson Forecast Director Jerry Nickelsburg expects the leisure and hospitality sectors in Santa Ana will have a slower recovery than other markets in California.