Costa Mesa's preliminary budget for the coming year includes a significant increase in capital-improvement spending that, when combined with other proposed expenditures, would require dipping into city reserves.
The preliminary, $157.4-million budget for fiscal year 2013-14, which was posted online Tuesday, assumes a $12.7-million deficit, according to a memo that Bobby Young, director of finance and information technology, sent to city officials Monday.
The 63 planned capital projects make up nearly 21% of Costa Mesa's total budget, or about $31 million — roughly a 50% increase from last year's $20.7 million in capital improvement spending.
The capital improvement projects include $6.8 million toward various street improvements and $3.5 million for Costa Mesa High School's track and field.
The preliminary budget as a whole is larger than last year's $132 million by about 19%, or $24.85 million. Upticks in various revenue sources — namely sales and property taxes, business licenses fees and the transient occupancy tax collected from overnight motel or hotel stays — are also anticipated.
Sales tax is the city's single largest revenue source. It's projected to contribute $48.5 million to city coffers — up from the estimated $45 million the year before.
There is also a slight increase in citywide hiring of full-time workers, from 465 to 467. A larger increase in part-time help, however, collectively equates to 14 additional full-time positions.
The council is scheduled to hear an analysis of the budget during its May 28 study session. Council members will also hear about measures to eliminate the proposed deficit and create a balanced budget, Young said.
The council will be expected to adopt a final budget in June before the start of the 2013-14 fiscal year in July.