COSTA MESA — During its meeting Tuesday night, the City Council lowered the personnel rates the city charges organizations to bring special events to the city.
Effective immediately, the new rates are about 27% lower and remove overhead and indirect costs from the city's bill to event organizers. The move is an attempt to attract new businesses, but runs the risk of decreased city revenues.
The council approved the measure with a 3-1 vote, with Councilwoman Wendy Leece dissenting and Mayor Pro Tem Jim Righeimer absent.
Some residents accused the council of endorsing corporate welfare for outside organizations, saying that any costs — be them direct or indirect — should be paid for by the outside groups so taxpayers don't have to.
The city's move runs the risk of lessened annual revenues from big events like the fair and Barrett-Jackson classic car auction, officials noted in the council staff report. Chief Executive Tom Hatch said fairground officials and organizers from the OC Marathon in the past have expressed concern at Costa Mesa's rates, though both events still operated within the city.
Officers oftentimes provide parking and traffic control for major Costa Mesa events like the OC Marathon and Orange County Fair.
Newport Beach also lowered its fee rates recently, Costa Mesa officials noted, in an attempt to remain attractive for the marathon and other events.
Costa Mesa charged between $150 and $225 an hour, including benefits and overtime for a sworn police officer, to work a special event — a rate sometimes two to three times higher than other Orange County cities, the city staff report showed. The rates were lowered Tuesday to between $107 to $160 for sworn police.
The city's budget for the current fiscal year estimates about $400,000 in policing revenue from events, though city staff estimates it could be about 20% higher, meaning any lost money by the discounted rates through next summer may not be felt budgetwise.
In other action, the City Council heard from an organized labor-backed consultant who presented their audit of the city. That audit argues that Costa Mesa has more fiscal wiggle room than it may have previously thought.
"I think you have some flexibility left," Steve Foti, of Harvey M. Rose Associates, told the council. "I don't think the sky is falling, and that perception should come to a close."
Rose Associates found if Costa Mesa contributes less to some line items — such as the equipment replacement fund and others — it can use those funds to pay off some debts early, thus freeing more money annually. Foti said some funding was a matter of priority and that the city could change directions to free up dollars immediately, pay down debts and save in the long run.
The city is in no way near insolvency, Foti said.
In the city's audit, Rose Associates found an additional $26.4 million the city could use if need be, but they made no recommendation on if and how any of those millions should be used because much of them are one-time savings.