During Tuesday’s meeting of the city council’s budget oversight committee, councilmembers Suzie Price, Stacy Mungo and Al Austin discussed a number of issues, including the city’s unfunded liabilities for employee benefits, which currently stand at $1.38 billion, according to a presentation by city staff. Unfunded liabilities are costs already incurred, but not paid for in full.
“This is the one area where I feel extremely concerned and uneasy about the effect that this may have on our budget,” Price noted during the meeting. The issue of unfunded liabilities, she recommended, should be front and center during the city’s upcoming budgeting process. Mungo, the committee chair, proposed the city increase its annual payments to pay down its debt quicker and avoid uncertainty in the future.
“The only way you start paying this down is when you are intentional about it. So in the same way that I would want to pay down my 30-year mortgage more quickly, some of the things you need to do are: not have cable, not go get your nails done every week and not have the nice-to-haves, and live by the necessities,” Mungo said. “Let’s just take the hit now and make that investment.” Even without that additional commitment, payments are expected to increase each year until Fiscal Year 2031, according to a staff presentation.
The committee also discussed the potential impact of proposed tax cuts for non-retail cannabis businesses on city revenues. Revenues collected through the Measure M cannabis tax are reinvested to fund the additional resources necessary to regulate the new industry. This includes staff tasked with licensing and inspecting business locations as well as additional public safety resources.
Industry advocates have argued that comparably high taxes on cannabis cultivation, manufacturing, testing and distribution businesses have stifled the industry’s development in the city, leading to diminished tax revenues. Price suggested a review of staffing needs associated with the city’s cannabis program to make up for any potential loss in revenues caused by a pilot program that would offer lower tax rates. Departments that were allocated additional staff in the city’s budget under Measure M include the city manager’s office, Long Beach Development Services and the city attorney’s office.
Reevaluating those staffing needs could mean reducing the number of additional positions allocated to each department to deal with cannabis-related issues. Public safety positions, Price noted, should remain a priority. “We just want to make sure that we’re in a position to prevent some of the harms that others have seen,” she said. The item was continued to the committee’s next meeting on August 13 for further discussion.
Independent contractors working in the City of Long Beach, as well as the companies they work for, had reasons to rejoice following Tuesday’s meeting. All three members of the committee expressed support for a proposal to reduce the number of business licenses contractors need to apply for in order to provide services in different locations.
The proposed policy, which would be particularly beneficial to hair stylists, massage therapists and aestheticians who rent out booths in different salons, would require independent contractors to pay full price for only one business license. Any additional locations could be added for a $38 fee. Currently, contractors have to apply and pay for separate business licenses for each location they service. This, Mungo noted, is keeping some contractors in her district from providing services at more than one location.