CURRENT SCOTTS VALLEY BASELINE BUDGET PROJECTIONS

The City of Scotts Valley is facing major fiscal challenges that it has in common with other cities, as summarized below:

  • Large pension cost increases
  • Deferred infrastructure/facilities maintenance and internal service needs
  • Significant reduction in staffing after the Great Recession
  • Labor market pressures

In addition, the City of Scotts Valley has the following additional fiscal challenges:

  • Low property tax allocation (since Prop 13 in 1978)
  • Measure U sales tax expiration (0.5% rate will expire in March 2022)
  • Uncertain Town Center development

Without new and continuing revenues, or significant reductions in services, the City would face annual deficits in excess of $2 million, along with negative fund balances, as shown by the charts below.

 

SCOTTS VALLEY BUDGET PROJECTIONS IF VOTERS APPROVE ADDITIONAL TOT RATE INCREASE AND APPROVE RENEWAL OF EXISTING SALES TAX

If voters approve the proposed 1% TOT increase in November and approve a future continuation of the existing 0.5% City sales tax before fiscal year 2021-22, the City’s fiscal health would look better, but would still reflect deficit spending in some fiscal years, as shown below.