City of South Lake Tahoe Forecasts Negative Cash Flow Unless Revenues Increase Significantly

The City of South Lake Tahoe made several strategic moves in 2010, allowing them to survive the financial crisis which caused so many problems in 2010. As the Five Year Financial Forecast is presented during Tuesday's City Council Meeting, it will be evident that it is time again to make more strategic moves to stay in the black and be sustainable. One such move should be a focus on growing the local economy.

The City responded to the needs of the community and budget shortfalls by operating as a business would by reducing costs. They cut staff and became creative on how to work within their means. They can't tighten the belt any more so time they are looking to increase revenues. As any business student could tell you, this is the model to look at to be financially successful: Reduce Costs, Increase Revenues.

In a letter to the City Council, City Manager Nancy Kerry is telling council that the solution to being fiscally stable and sustainable for the long term is to establish a strong economic development strategy. Unexpected expenses (passing of Measure P and unexpected CalPERS expenses) "trigger a projected negative cash flow by 2017 unless revenues increase beyond projections," according to Kerry.

"The City cannot grow the economy on its own," Kerry continued. "A focused, effective economic development strategy will support the business community, which in turn will provide significant economic and environmental benefits for the entire south shore community."

Action oriented leadership on the City Council will continue to be needed if we expect to grow the economy. To succeed, the community should ask their leaders to continue the path they have taken to get through the recent tough times by investing in business, reducing red tape and investing in capital projects and recreation.

A friendlier business climate will attract more investors in the community, thus helping the city meet their budget. Thomas Watson, the City Attorney, is taking the volumes of City Code and reducing them into a small and condensed book which will make it much easier for local businesses and citizens to know what can and cannot be done.

Kerry is going to recommend the city get community members involved on a task force that will focus on strategies. "A Community Economic
Development Task Force should be established comprised of experts who
understand the local economy and can deliver recommendations to City Council and other local agencies of specific strategies to attract and encourage investment," Kerry said.

If you cannot attend Tuesday's meeting on the City Budget, send in your opinions to the City Clerk Susan Alessi at salessi@cityofslt.us. The meeting starts at 9 a.m. in Council Chambers at the airport.