Page 23 - FY 2021--22 Revenue Outlook

General Fund Revenue Outlook
Fiscal Years 2020-21 through 2025-26
General Assumptions

Economic Growth This forecast is based on long-term historical experience, with total City revenue
growth for outgoing years estimated between 3.4 and 7.3 percent, excluding
federal relief funds. Unless otherwise noted, individual revenue sources reflect
continuing growth in fiscal years 2022-23 through 2025-26 based on historical
average receipts.
Property Tax Fiscal year 2020-21 revised receipts reflect the County Assessor’s reported growth
in assessed value for the City, offset by refunds and other adjustments. The County
Assessor has not provided a preliminary estimate for property tax growth for
2021-22. Assessed value growth of 5.9 percent is based on assumptions for lower
growth due to low inflation; redemption activities are assumed to remain flat as
taxpayers become current on delinquencies; and refunds are projected to increase
as commercial property owners seek reassessment. 2022-23 is based on
economic forecast estimates, and outgoing years assume similar growth.
Redirection of ex- This revenue category was first received in June 2012. Growth is irregular due in
CRA Tax Increment part to one-time miscellaneous revenues that may occur in any given year. The
Monies June 2021 payment is based on the County’s April estimate. The estimate for
2021-22 reflects the adopted payment schedule (ROPS) and assumptions based
on prior disbursements. Additional one-time miscellaneous revenue from surplus
property sales are assumed for 2021-22 and 2022-23.
Subsequent fiscal years assume conservative growth based on the trend of lower
tax increment growth (receipts) and increasing pass-through distributions
(expenses) and align with property tax growth assumptions.
Utility Users Tax Electricity users tax (EUT) revenue for 2020-21 and 2021-22 are provided by the
• Electricity Users Tax Department of Water and Power (DWP) and are based on the 2020 load forecast
updated to reflect pandemic impacts and actual receipts. Outgoing years assume
• Gas Users Tax average growth.
• Communication Natural gas users tax revenue for 2020-21 reflect receipts-to-date and the first full
Users Tax year of a three-year rate reduction stemming from a class-action lawsuit settlement.
2022-23 and onward assume consumption and prices remain stable.
The decline in communication users tax (CUT) revenue has accelerated with
strategic wireless plan pricing and decreased landline use. 2021-22 revenue
assumes that same rate of decline as 2020-21, and outgoing years assume that
drop in CUT receipts slows.
Departmental Departmental receipts for 2020-21 have been revised downward to reflect the
receipts extended impact of pandemic-related closures. 2021-22 receipts assume the end
of pandemic-related restrictions and the gradual restoration of full service delivery.
Related costs reimbursements for 2020-21 and 2021-22 are based on updated
CAP rates and vacancy, salary and service level assumptions.
2022-23 assumes receipts to have returned to the pre-pandemic trend in receipts
with growth slowing 2.7 percent in outgoing years.
Sales Tax Sales tax revenue for 2020-21 and 2021-22 onward reflect the decline and then
subsequent recovery from the pandemic-driven recession.
Business Tax The revised estimate for 2020-21 business tax reflects a net increase from 2019-20
due to the delayed receipt of 2019-20 cannabis-related business taxes during the
initial pandemic-driven closure and the addition of tax amnesty revenue. 2021-22
receipts reflect the loss of amnesty receipts, recovery in non-cannabis related
business activity, and continuing growth in cannabis-related business activity
Outgoing years assume high, but decreasing, growth, primarily attributed to
assumptions for cannabis receipts.

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