Santa Ana will finish the fiscal year with $2.7 million in the bank, said city Finance Director Francisco Gutierrez.
“By the end of the year we should have a positive balance,” Gutierrez said during an interview this week.
Gutierrez’s comments come after Voice of OC revealed that the city’s general fund balance was down to $313,343 at the end of September, about 0.1 percent of its approximately $200-million general fund budget. To pay all its bills in September and October, the city transferred some cash from internal service funds.
The city is facing a budget deficit for fiscal year 2012-13 that could go as high as $30 million. This has city leaders in negotiations with its labor groups — particularly police and firefighters — to dramatically cut city costs. Public safety expenditures, mostly compensation, consume nearly 80 percent of the general fund.
In June, the City Council approved $8.2 million in transfers from internal service funds to help balance this year’s budget, said Gutierrez. The city will not be moving money from those funds after December, when the city receives a large property tax disbursement, he said.
Cities typically run low on unrestricted funds during this time of year as they wait for year-end property tax payments. December is also the month cities usually receive the most sales tax revenue.
A city-commissioned budget analysis, done by the financial consultant Management Partners Inc., concludes that funds normally sent to cities but reserved this year for the state budget have tipped Santa Ana’s current budget out of balance by “several million dollars or more.”
But more retirements than expected, limits on city purchases and outsourcing some services will result in a balanced city budget this year, Gutierrez said.
“All of these efforts combined, if realized, would provide for a positive balance at year end,” Gutierrez wrote in statements emailed to a Voice of OC reporter.