Page 452 - FY 2021-22 Proposed Budget

This Revenue Forecast Report for the City of Los Angeles provides revenue
estimates for fiscal years 2020-21 and 2021-22 in advance of the City’s
upcoming budget process. Also included are the estimated requirements for
debt service and General Fund cash flow borrowing. The Forecast is issued
pursuant to the Controller’s City Charter mandate to monitor and report on all
matters relating to the City’s fiscal health, to keep the City’s official financial
records, and to supervise City expenditures.

This Office based these estimates on information received from departments,
consultation with local economic experts and academics, and historical as well
as recent trends.

Financial Outlook

Current Year: 2020-21 General Fund Receipts (billions)
$6.37 $6.43
The current fiscal year has seen the brunt of a
dramatic economic slowdown. Safer-at-home $6.14
orders at some level have been in place since
before the fiscal year began and are anticipated
to remain in place through most, if not all, of the
remaining four months. This enforced shutdown FY20 FY21 FY22
of large sectors of the economy has resulted in Actual Estimate Projection
the first significant decrease in City revenues
since the Great Recession.

Overall, we estimate that actual General Fund revenues will fall by 3.7% from
the prior fiscal year, to a total of $6.14 billion. In the context of the budget,
this means the General Fund will have a $549 million shortfall.

Next Year: 2021-22

Our projection for the upcoming year is based on the assumption that state
and local safer-at-home orders will be loosened over time beginning this
summer, and the 2021-22 fiscal year will bring forth the beginning of the
recovery for the local economy as well as the City’s revenues.

For the General Fund, the year is expected to see 4.7 percent revenue growth
over the current fiscal year estimate, led by recoveries in most of the
economically-sensitive revenues. This $6.43 billion would be $289 million
more than 2020-21, and $54 million more than 2019-20.

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