Part III Using the selected government budget from Parts I and II in the previous units, expand upon your previous works in discussing the following areas: Privatization efforts that have been made a

SAN DIEGO’S BUDGET AND FINANCIAL ANALYSIS 7

San Diego’s Budget and Financial Analysis

George Landry

Columbia Southern University

05/05/2021

San Diego’s Budget and Financial Analysis

A financial budget offers the outline of how a government, organization, or corporation controls its expenses, sales, cash flow, and assets. A financial budget is utilized to paint an image of an organization's financial health, and it indicates a thorough summary of its income compared to the revenue of operations. This evaluation aims to examine the financial budget of San Diego city for the last three years. San Diego is the United States' eighth biggest district with an approximated population of 1.5 million people residing in the city as of 2020. Furthermore, San Diego ranks as the second most inhabited city in California after Los Angeles (Telvin, 2020). San Diego City is a metropolitan zone of San Diego-Tijuana and a commercial point for many in the region. The leading financial drivers of San Diego are industrial manufacturing, operations related to military and defense, transport, and foreign trade.

The financial budget of San Diego is unveiled between July 1 and covers the whole fiscal year up to June 30. The first step of the municipal budgeting plan is for the committee to participate and pass the budgetary priorities. Following the assembly, phase creates a budget plan is accomplished in collaboration with the mayor, agencies, chief financial officer, and administrative officer. The next step is given to the committee to organize public budget proceedings to ensure that necessary changes are made to the budget. There has been continued growth and development of San Diego's economy, and the Adopted Budgetary forecasts show that there is an expected increase in income of all the chief sources of revenues; the Franchise Fees, Transient Occupancy Tax (TOT), Sales Tax, and Property Tax 2020 (Faulconer, 2020). The projected budget considers the increasing positive trends in economic growth and the improvement in all the sources of revenue. The following is the budgetary allocations for the fiscal year 2018-2020:

General Fund Revenues for the Fiscal Year 2018-2020

San Diego's budget for the fiscal year 2020 General Revenue Fund was $1.55 billion, reflecting the 7.8% increase rate ($112.27 million) from the financial budget for the fiscal year 2019. It is worth noting that the general fund is made up of significant income revenues for San Diego City: franchise fees, transient occupancy fees, sales taxes, and property taxes. For the year 2020, the proposed budget accounts for 72.2% of San Diego's General Fund revenues and is expected to increase significantly by 6.6% or $69.4 million from the year 2020 (Faulconer, 2020). There was an improvement in financial trends for the fiscal year 2019. However, it was less than that of previous years. Furthermore, there is an irregularity in inflation, federal laws, and interest rates that can directly affect these aspects in the future.

Although there is no fiscal recession in Governor’s budget, the budgetary proposal addresses future and possible recessionary suggestions. The current assumption on the downturn of the administration replicates a more significant slowdown than the economic recession experienced in 2001, though lesser than that experienced in 2009 (Telvin, 2020). A one-year recession between 2019 and 2020 can lead to an approximated loss in revenue of $70 billion and a deficit of approximately $40 billion. In the first, second, and third-year after the recession, the average loss in revenue was estimated to be $25 billion, followed by $15 billion and $20 billion, respectively.

There are sound financial policies on taxes, fees, and how residents are charged in San Diego. They aim to certify that all residents in the city pay tax costs and charges. The policies further minimize the number of people seeking to violate the regulations of San Diego. For instance, the city has guaranteed that its financial practices are found ethical through multiple sources of revenue and fees charged to residents (Telvin, 2020). Furthermore, the government constructed additional public recreation centers to avoid overwhelming people with unnecessary tax loads. Moreover, the state has enforced legal limits on specific expenses, allows financial reliefs to its people, and guards them against exploitation by officials.

The city's code of ethics requires leaders to reveal their possible conflicts of interest. This ensures that the associates or officials do not levy unnecessary expenses, taxes, and fines on residents to benefit themselves. The legislation also requires senior officials to report their conflicts of interest to the committee before acting on any bill (Telvin, 2020). San Diego has further created policies that promote the involvement of the public in the execution of ethical standards and financial policies that inspires openness and transparency.

Taxable revenues grew from $15 million in 2018 to $18.6 million in 2019. It is an internal change that shows more opportunities come with revenue advancements. Tourists and visitors who traveled in San Diego from 2017 to 2018 increased significantly from 36 million to 42 million visitors in 2020 (Faulconer, 2020). San Diego's city can adjust tourism prices to improve the city's revenue and erect more social amenities that need a small fee for using the services. A significant interference to income is entertainment and gaming. The sales on gaming reduced from $9.8 million in 2017 to $9.6 million in 2018, which created a decline in the future revenues for San Diego.

References

Faulconer, K. (2020). Adopted Budget Fiscal Year 2020. City of San Diego Official Website. Retrieved June 5, 2021, from https://www.sandiego.gov/sites/default/files/fy20ab_v1generalfundrevenues.pdf

Telvin, A. (2020). Office of the independent budget analyst (IBA). City of San Diego Official Website. Retrieved June 5, 2021, from https://www.sandiego.gov/iba