City of Fullerton logoAs in other economic downturns, the COVID-19 pandemic reduced local revenues for the City of Fullerton. The State’s shelter-in-place order significantly impacted local sales tax, transient occupancy tax, and various program revenues. 

In response to this, the City Council recently approved a 2.5% reduction in its annual budget on top of a $3.8 million budget reduction incorporated in the adopted budget. These budget cuts resulted in painful cutbacks in staffing and expenditures. However, it has eliminated the structural deficit and produced a positive net change in the City’s General Fund Balances beginning in the current fiscal year  (FY 21-22). The City’s financial forecasts project a continuing growth in fund balance over the next five years. 

Fullerton has seen a strong resurgence in post-COVID revenue growth. Sales tax and transient occupancy tax revenues are projected to grow by over $5 million during this fiscal year. 

Furthermore, the City’s General Fund Contingency Reserve (rainy day fund) has grown from 10%  to 13.5%, placing the City in a healthier position in the event of a downturn in the economy. 

On top of these fiscal advances, the City Council recently approved the use of American Rescue  Plan Act (ARPA) funding to address a variety of needs over and above normal budget allocations. These  include: 

  • $13.1 million for street infrastructure
  • $2.0 million for water infrastructure
  • $3.2 million for facilities infrastructure
  • $2.1 million to support the unhoused
  • $9.6 million to fund government operations 

Mayor Fred Jung shared, “The budget reductions the City Council instituted during this fiscal year were difficult but necessary to put Fullerton back on a firm fiscal foundation. We are back, moving forward, investing in our community’s facilities and infrastructure, and seeing strong private investment in our community. There is much to be optimistic about for the coming year.” 

For more details and an update on the City’s financial position and upcoming projects, please join the City of Fullerton and the North Orange County Chamber of Commerce in attending this year’s State of the City address with Mayor Fred Jung. This year’s event will be hosted at California State University,  Fullerton in the Titan Student Union on Wednesday, March 30th from 11am – 1:30pm.