Santa Ana officials will soon be calling on the Orange County Fire Authority to return $2.9 million back to city coffers.
That’s the amount the fire authority required the city to deposit into an escrow account upfront before agreeing in 2012 to absorb the now defunct Santa Ana Fire Department.
At the time, the city was mired in a historic budget crisis, and OCFA’s leadership demanded the cash in case the city missed a services payment to the regional fire agency.
But the city’s financial picture has brightened considerably since then, thanks in part to the decision to outsource the fire department. The city’s contract with OCFA allows the city a chance to ask for the deposit back if the city “demonstrates an improved financial position,” according to a staff report.
Santa Ana City Council unanimously and without comment approved the request at its regular meeting earlier this month.
City officials will be presenting the city’s finances – including a reserve level approaching 20 percent of the annual budget – to the OCFA budget and finance committee and then the board later this month.
The request is also one of the latest efforts to bring the city budget back to full strength. By 2011, the city’s general fund had dwindled to $3 million, or just one month’s payroll, and was facing a $30 million budget deficit. City leaders were seriously considering filing for municipal bankruptcy.
The city has bounced back, but remains at just above bare-bones services levels.
And with residents clamoring for amenities like parks and after-school programs – and a recently adopted strategic plan that promises more services – City Manager David Cavazos has been looking for creative ways to beef up revenue.
One of Cavazos’ first tasks was to reappraise the city’s revenue forecast, which to him seemed low. The new projections increased tax revenue, with Cavazos insisting that the brighter estimates were still conservative.
As part of that strategy, the council last week also approved refinancing bonds for the city jail and City Hall expansion projects. That action is expected to save over $2 million over the next several years.