Escondido

Escondido officials proposed cutting city department budgets and dipping into contingency funds Monday to offset a $3-million budget shortfall that resulted primarily from drops in sales tax and building fee revenues.

Sales taxes, which originally were projected to rise about 7% over last year to $19.8 million, are now projected to fall 3.7%, a gap of $2.3 million, according to a mid-year review released by city officials.

Under the staff’s plan, city department operating budgets will shrink by 4.5% and the city will dip into its contingency funds.

City Manager Doug Clark said Escondido, which retains a $6-million reserve, is in sound financial condition and pointed out that none of the cuts being considered will affect city services.