California – Orange County Cities Debate Financial Response To Coronavirus Sales and Hotel Tax Losses

Cities across Orange County are reevaluating budget projections for the rest of the fiscal year as massive reductions in sales tax revenue and other essential city revenue sources have dried up amid the stay at home order. 

One of the primary losses for most cities came from their sales tax revenue, which can make up anywhere from 10% to almost 40% of a city’s annual revenues. Transient occupancy tax revenue has also plummeted, as hotels report no new guests. 

A Voice of OC review found that according to each city’s estimations, the combined total losses for the cities of Irvine, Newport Beach, Huntington Beach, Brea and Fullerton comes to over $44 million for the current fiscal year. 

Many cities are taking different approaches in handling the loss of sales tax revenue and combating the covid-19 pandemic.

The only thing that all the cities agreed on was that the total impact for the 2020-21 fiscal year is still unclear, but that reductions to city services could be seen for the next year or two.

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Voice of oc
by noah biesiada
april 27, 2020