By Staff Report Tuesday, March 16th, 2010

General fund cuts are inevitable as revenue declines are historic, Santa Barbara City Manager Jim Armstrong said March 16 at the annual State of the City address.

The $140 million general fund has experienced a 20 percent decline in retail taxes, a 16 percent decline in hotel taxes and an even sharper decline in property taxes over the past two years, he said.

Thirty-seven city jobs have been cut and 51 are vacant, and fire station brownouts are possible this year, Armstrong said. Police and fire services currently make up 70 percent of the general fund.

Santa Barbara will experience another $9 million gap next year, but the city could close $7 million of that with a 10 percent cut in union pay and benefits.

“We have tried all the easy solutions,” Armstrong said. “Our county and area educational instructions face the same challenges.”

“I expect many lively discussions as the budget debate begins in April,” he said.

Santa Barbara Mayor Helene Schneider said that she plans to hold quarterly meetings with local businesses to discuss economic development issues.

Santa Barbara is updating its general plan this year for the first time in 20 years and Measure E growth limits, passed by ballot initiative in 1989, are also expiring this year.

Santa Barbara’s green energy initiative includes a new, LEED-certified fire station.

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