Here's How Orange County Cities Are Managing Vastly Different Budgets

It’s that time of year, when city, county and state governments are discussing budgets for the fiscal year. While some cities in Orange County are scrambling at the end of the fiscal year looking to cut corners and tighten spending on city services, others are able to make forward projections. Fiscal years typically start on July 1 and end on June 30 of the following year. Budget forecasts determine how your tax dollars are spent: law enforcement, city facilities like libraries and parks, water and sewer service, resources for the unhoused, seniors and childcare. City budgets will also include federal and state funding sources.

Here’s a look at the proposed budget for Orange County and some of its cities:

County of Orange

The total county budget for the next fiscal year is $9.5 billion. Around $3.7 billion of that will go towards the county’s Social Services Agency, Health Care Agency, child support services and for awarding city contracts and grants. The General Purpose Revenue – with around 93% of revenue generated from property taxes in the county - will go towards public safety with the Orange County Sheriff’s Department receiving most of the funding. In 2023, the Board of Supervisors approved a pay increase for Orange County sheriff deputies. The OC Health Care Agency gets over $100 million from the General Purpose Revenue.

Gov. Gavin Newsom announced a budget shortfall in the state budget and this could affect the county, according to the proposed budget put together by county staffers. At the county level, the Public Defender’s Pilot Program could lose out on its last year of funding. The program was created by a state grant to help public defender offices that were understaffed with case backlog specifically related to those who were eligible for early release. County programs for housing could also see cuts along with cuts to funding that addresses drug overdose prevention and MediCal.

To learn about the County’s budget, click here.

Santa Ana

The city of Santa Ana is yet to release its budget for the upcoming fiscal year. But earlier this year, city officials sounded the alarm as revenue generated from the Measure X sales tax is set to reduce in 2029. Currently, the sales tax is responsible for 22% of the general fund budget.

Voters in the city approved Measure X in the 2018 election, where Santa Ana’s sales tax went up by 1.5%. That tax is set to reduce to 1% in 2029 with the city set to lose $30 million.

What could this mean for your city services? Funds generated from the sales tax goes towards emergency response services, street repairs and the upkeep of parks and senior services.

At a council meeting in April, city staff said projections show that since expenses are increasing faster than money coming in, Santa Ana could see a budget deficit next year.

Old Santa Ana City Hall.

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Eli Pousson, CC BY-SA 2.0

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Wikimedia Commons

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The city council is set to discuss and adopt the next fiscal year budget at the June 4 city council meeting. If you would like to weigh in, you can attend the council meeting in person or follow along online to provide your feedback via public comment.

To explore Santa Ana’s budget in detail: www.santa-ana.org/budget.

Orange

The city of Orange is looking at a $19.1 million budget deficit and is exploring cutting services or raising the costs of fees for city services. To save on costs, city staff have proposed either selling Taft Library or not filling vacant positions, and cutting down on park clean ups.

Currently, visitors to Old Towne Orange can park at the parking garages for free. However, with the city down on money, that could soon change too.

City leaders have not decided which measures to go ahead with it as the fiscal year looms and could potentially bring it up at the next council meeting slated for June 11. The agenda for the meeting is yet to be posted.

Westminster

In the current fiscal year set to end on June 30, Westminster is facing a $9 million deficit. That could be partly alleviated with voters in the March election approving the ballot measure Measure E, which will increase Westminster’s sales tax by 0.05%.

Revenue from the tax is projected to add $8 million to the city’s coffers every year.

The Asian Garden shopping mall, also known as Phước Lộc Thọ in Little Saigon.

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Brian Feinzimer

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LAist

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In 2016, voters in the city approved Measure SS raising the sales tax by 1%. Again in 2022, they approved a ballot measure to keep that 1% tax increase through March 31, 2043. If the measure had not passed in 2022, city staff had warned that Westminster could face bankruptcy.

Westminster is set to adopt the next fiscal year budget later in June. Staff reports show expected revenue to be $143 million while the expenditures are expected to be $147.3 million.

Huntington Beach

Huntington Beach has been involved in a range of litigation with the state of California including over state housing mandates and voter ID requirements. For the 2023/2024 fiscal year, Huntington Beach’s city attorney Michael Gates’ office oversaw around 95% of litigation in house.

In the fiscal year that will conclude on June 30, the budget allocation for the city attorney’s office increased by over 30% to over $3.7 million. For the proposed budget for the next fiscal year, the office is expected to see a 13% increase in budget to $4.2 million.

To learn more about Huntington Beach’s proposed budget, click here.

Anaheim

Anaheim is looking at a proposed budget of $2.3 billion, up 9% compared to the last fiscal year budget. The city continues to rely on the general fund for expenditures with the city expected to spend $490.9 million in the next fiscal year with over 60% of it going towards the police and fire department.

Majority of the funding for the general fund comes from a 15% tax that hotels, motels and short term rentals charge guests.

For the 2023/2024 fiscal year, the transient occupancy tax is projected to bring in the city over $256 million, a 14% increase from the previous and is the highest in Anaheim’s history. This is the first full fiscal year the tax is being collected since Measure J went into effect in January 2023. Under Measure J, online and travel booking companies are required to levy hotels, motels and short term rentals the transient occupancy tax based on the total amount a guest pays them. Previously, online and travel booking companies charged a flat tax fee agreed on with the hotels, motels and short term rentals.

Anaheim is slated to hold a public discussion on the proposed budget on June 11. For more information, click here.

Tustin

While Tustin sets its budget on a biennial basis, the fire in the North Hangar at the former Marine Corps Air Station has led to the finance director asking the city council to increase the revenue budget and allow payments related to the fire by a further $27 million.

Since the fire broke out last November, the city has spent $85 million to clean the debris, monitor air quality, sample air dust and soil and deconstruct the doors of the hangar, among other costs incurred.

The historic blimp hangar, at right, seen as it burned on Nov. 7, 2023.

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Jae C. Hong

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Associated Press

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“However, the true total fiscal impact on the City, County, and region remains unknown at this time and will continue to be assessed,” staff wrote in the report to the council.

The city has received $33.5 million in reimbursements from the Navy which owns the Hangar and is expected to receive a further $88 million.