Parks director warns of $6.4 million General Fund shortfall; staff proposes temporary CIP reductions and maintenance focus

City staff told the Parks and Community Services Commission on March 13 that Costa Mesa faces a General Fund revenue shortfall for fiscal 2024-25 of roughly $6.4 million, driven mainly by weaker sales-tax receipts from retail and auto dealerships. Staff proposed temporary reductions to some capital improvement projects (CIP) and deferral of street sweeping costs to the gas tax fund to offset the gap.

Director Ryan Gruener said adopted citywide expenditures for FY2024-25 were approximately $189.9 million while General Fund year-end revenue projections were estimated at about $183.5 million, producing the roughly $6.4 million shortfall. The shortfall, he said, will affect timing and scope of some construction and CIP projects and staff will continue monitoring revenue and spending as the budget process proceeds.

Staff described recommended near-term measures intended to limit operational impacts. Those include temporary reductions of some CIP work, deferring certain street-sweeping costs to the gas-tax fund and prioritizing maintenance needs to avoid safety and accessibility problems. "Some of these impacts will affect obviously some of the potential construction projects or capital improvement projects that we're looking at for the future," Gruener said. He told the commission the city is engaging in proactive planning to minimize service impacts.

In the department report accompanying the budget discussion, staff also highlighted new and ongoing Parks programs and projects that will continue despite the revenue pressure. Among them: a pilot free swim lessons program with Newport-Mesa Unified School District and the YMCA operating April 14–May 23 at the Downtown Aquatic Center; 48 students are registered — currently the program's maximum — and a waiting list is in place. Staff also announced facility-wide Wi-Fi installations across parks facilities, an April 1 Council hearing on the Fairview Park Master Plan (including discussion of HSS Flyfield), and a delayed Mesa restoration project scheduled to award contract in August and begin construction after nesting season (September–October).

Rob Ryan, maintenance services division manager, summarized a slate of CIP projects in design or construction, including Ketchum Lyboldt Park expansion (planned bid release in April, construction late summer/fall 2025), Shalimar Park redesign (design and bidding in spring/summer 2025), Brentwood Park improvements (community outreach planned for April), batting-cage and drainage work at the Two-Way complex, and field and lighting upgrades completed or underway at multiple facilities. Staff said most park projects currently moving forward are grant-funded and therefore less vulnerable to the immediate General Fund shortfall.

Commissioners pressed for clarity about how priorities were set and asked staff to provide a single, consolidated view of projects, funding sources and how delays would change costs. Several commissioners suggested the commission hold an April discussion of the five-year CIP and the department's park-assessment study, and to gather district-specific observations from commissioners to inform priorities. Director Gruener said staff would return with further details and that a park-assessment consultant will be onboarded in coming months.

The commission moved the consent calendar (minutes and department report) and voted to receive and file the department report; the motion carried 7-0.

Ending: Staff said they will continue monitoring revenue, move to prioritize maintenance and high-need projects, and return to the commission with a more detailed multi-year CIP schedule and the forthcoming park-assessment results.