“The Realities of Recession in California” by Senator Barbara Boxer

While you would need to be off in space not to know that we are in a recession I thought sharing part of a report received from CA Sen. Barbara Boxer today would provide some transparency with a focus on the city of Santa Ana as this is the HQ of the Orange Juice blog.

The Executive Summary opens stating that “California’s budget crisis and housing crisis, combined with the worldwide economic downturn have placed massive strains on California’s finances.”

Senator Boxer reports that “California has lost more than 100,000 jobs in the past year, and its unemployment rate is 8.2 percent statewide–the highest in 14 years.
Throughout the first three quarters of 2008, 189,000 California homes were lost to foreclosure.”

At this point I will skip the page on Orange County and go directly to the December 16th data on the City of Santa Ana whose population is listed at 353,184. The report claims that the Santa Ana unemployment rate is approximately 8.5%.

It also points out that there were 8,036 foreclosure filings between Jan-Nov 2008 representing 1 per every 11 households.

The text follows:

The city of Santa Ana is experiencing significant budgetary challenges and has had to use budget reserves to stay afloat. Currently the City is $43 million in deficit and is in the process of developing reduction plans.

The City has had to reduce expenditures though postponing large equipment purchases, freezing travel, and scrutinizing unmandated training. City programs have not been delayed or canceled yet. The City is trying to preserve front-line services–police, fire, libraries, etc. Currently, the city is holding 123 jobs vacant, which is helping to increase money in the general fund. Reduction plans might have to include layoffs, but no decision has been made.

At this point credit and infrastructure projects are doing fine. The major problem for the City is the growing deficit with the general fund, not credit. There are no direct estimates on the loss of property tax revenue yet because property taxes have a 1-2 year lag time. The City will not see the impact for another 12-18 months. Overall, crime is down. However, burglary-type crimes are up. There has not been a huge surge in code violations. Non-governmental charitable organizations are struggling. For example, the demand for donated toys and food this holiday season has increased, but donations of these items have decreased.”

Juice readers. Query. Do you accept the statements made above? If not, please add your own knowledge which hopefully will get back to the city administration and eventually to Senator Boxer.

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