City Council was again unable to come to a consensus at their October 19 meeting about whether to make budget cuts and how to allocate the $32.7 million the City received from the American Rescue Plan Act (ARPA).

Mayor Bruce Whitaker and Mayor Pro Tem Nick Dunlap proposed budget cuts of up to 3% (which would result in cutting around 20 employees), and using the bulk of the funds for road and infrastructure repair.

Making additional budget cuts is not part of the required ARPA allocation process. The idea for cuts has come from Mayor Whitaker, Mayor Pro Tem Dunlap, and Councilmember Fred Jung who have pointed to an ongoing structural deficit. While the ARPA funds can fill this deficit in the short term, the councilmembers have all expressed the desire to make cuts for the purpose of longer-term budget stability.

Councilmember Ahmad Zahra was not in favor of budget cuts and wanted to use the majority of the money for government operations, which includes staffing, services, and budgeted infrastructure projects. The current budget, as adopted in June, has allocated funds for infrastructure repair.

Councilmember Jesus Silva said he would go along with Councilmember Jung’s proposal for a 1% cut so long as this did not result in staff layoffs and instead came from eliminating positions that are already being held vacant.

A staff report stated that the City is currently holding 37 positions vacant, for a savings of $3.8 million annually. However, according to Acting City Manager Steve Danley, there are actually 110 additional vacancies on top of this 37.

“Some positions are being held vacant until Council determines what budget adjustment scenario they will approve,” Danley told The Observer.

During the pandemic, the City laid off over 150 non-regular (part-time) employees and seven full-time employees. All of this has caused significant reductions in City services.

During public comment, many City employees said that their departments had already been cut severely and could not handle further cuts.

“In the past we used to pride ourselves on having long time, quality, dedicated workers,” Ed Bargas, president of Fullerton Municipal Employees Federation, said. “Lately, we’ve been losing a lot of workers to neighboring cities. We hire and train them, but then they go [because of better pay]. Those are some of the hidden costs of having constant cuts.”

According to the Department of the Treasury, the purpose of the ARPA funds is to:

• Support urgent COVID-19 response efforts to continue to decrease spread of the virus and bring the pandemic under control

• Replace lost revenue for eligible state, local, territorial, and Tribal governments to strengthen support for vital public services and help retain jobs

• Support immediate economic stabilization for households and businesses

• Address systemic public health and economic challenges that have contributed to the inequal impact of the pandemic

During previous budget discussions, Administrative Services Director Ellis Chang presented Councilmembers with four main scenarios for use of ARPA funds and potential cuts. They are as follows:

Councilmembers have subsequently proposed several alternate scenarios in an attempt to negotiate a consensus. As a result, at the October 19 meeting City staff had prepared 18 different scenarios for Councilmembers to choose from.

There followed a negotiating session in which various scenarios were proposed, but no consensus was reached.

This item will likely come before Council at their next meeting on November 2 at 6:30pm at City Hall.