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SLO City council takes immediate action to address financial challenges due to COVID-19

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Posted at 6:01 AM, Apr 09, 2020

San Luis Obispo city leaders are addressing both the short and long-term economic impacts of the COVID-19 emergency.

City Council has developed an Economic Recovery and Resiliency Plan. That plan will focus on actively engaging in economic stability and recovery efforts in partnership with residents, businesses, and community and regional partners.

In March 2020, the Council allocated $6.2 million of one-time year-end savings to support the City's emergency response to the COVID-19 emergency. At the same time, the City activated its Fiscal Health Contingency Plan limiting hiring and purchases to essential services and closing City programs and services not allowed under the Shelter at Home Order. City leaders say this resulted in approximately 100 fewer part-time and seasonal employees. The City Coundil has also taken a number of steps to support local businesses including the approval of delaying late fees and penalties for transient occupancy tax remittance through the month of August.

"Our community has always overcome challenges and emerged even stronger from them," said Mayor Heidi Harmon. "Our priority right now is to continue providing essential services to protect the health and safety of our City. It will take a community wide effort to develop and implement a plan that puts us on a path towards economic recovery and resiliency. I am confident that we are better together and that our strong relationships with our residents, the County, Cal Poly, local businesses, and community organizations will result in a collaborative effort as we all lean into efforts to revive our economy."

According to a press release, as of April 7, preliminary revenue projections foreshadow a loss of approximately $6.5 million in revenues primarily from significant declines in transient occupancy (tourism) and sales tax. Revenues are also lower in the Parking, Transit, and Water and Sewer enterprise funds. In addition to the immediate actions already taken, further cost reductions are expected as part of the 2020-21 budget, scheduled to be adopted in June. Those reductions will focus on limiting the overall impacts to the community while also ensuring the City is in position to support recovery efforts.

This Economic Recovery and Resiliency Plan will be presented to Council with the 2020-21 budget in June.

"I am proud of the steps we have taken to manage our fiscal health during this unprecedented time," said Derek Johnson, City Manager. "We are committed to doing what is necessary to both protect public health and safety during this emergency and take actions that will repair the economic damage that has been caused."

For more information from the City's response to COVID-19, visit this website.