Long Beach's Budget Deficit Forges Vastly Improved Relationship With Constituents

摘要

In 2002, the City of Long Beach marked a turning point in its relationship with constituents. While formulating its fiscal year 2002-03 (FY03) budget, the city discovered that it faced a $46 million structural deficit in its general fund. The deficit, combined with a growing perception of nontransparent decision-making, all but destroyed public trust and confidence in city government. These feelings became manifest in endless op-ed pieces, letters to the editor, negative articles about management and accusations about the absence of openness. The FY03 gap was filled using one-time revenues and transfers from other funds into the general fund. However, looking ahead, the situation appeared only to worsen, with the city's uncontrollable fixed costs growing an additional $40-50 million over the next three years and revenues projected to remain flat or shrink. In response to external pressure and the mounting call for accountability, the city council fired the city manager weeks before adopting the FY03 budget in September 2002. As a condition for adoption of the budget, the mayor and city council called for the formation of a citizens' Budget Advisory Committee to review city finances and develop a three-year financial strategic plan within 90 days that would address the city's growing structural deficit.