In a recent interview, Mayor John Wu highlighted that the early repayment of public works loans has been key to the city’s financial improvement this fiscal year. San Gabriel, one of the prominent cities in Los Angeles County with a significant Chinese community, had long struggled with fiscal challenges, often appearing on the annual list of California cities with the highest financial risk. However, preliminary fiscal reports indicate a remarkable turnaround, showing a budget surplus of $4.67 million as of June 30, 2023—over 23 times greater than the previous year’s surplus.
According to the city’s financial report released on October 1 for the 2023-24 fiscal year, San Gabriel’s General Fund is projected to generate $53.84 million in revenue, an increase of $233,000 compared to the previous year. Key drivers of this revenue growth include a $762,000 rise in permit and license fees due to increases in permit costs for some large projects, including building, plumbing, and electrical permits. Additionally, service fee revenues have increased by $622,000, driven by growth in plan review, fire services, and ambulance fees. Other contributing income stems from biennial adjustments to Proposition A funding, one-time custodial income, workers’ compensation reimbursements, and proceeds from the sale of city property.
Mayor Wu emphasized that the strengthened financial position has bolstered the city’s reserved fund balance, which now accounts for 41.5% of the General Fund, significantly exceeding the targeted 17%. This improvement opens up greater opportunities for the city’s development. Notably, as recently as 2021, the California State Auditor classified San Gabriel as a city at high risk of financial instability. Through measures such as financial planning reorganization, transparent audits, and strict fiscal discipline, the city has instilled hope among its employees, including those in public safety, during the financial recovery process.
Despite a decrease in tax revenue by $686,000 this fiscal year, Mayor Wu remains optimistic. He pointed out that many construction projects are underway, leading to anticipated increases in revenues from permit applications, license fees, and service charges, which should support a continuous growth in overall revenue.
A significant factor in the city’s favorable performance this year has been a reduction in expenditures. The city’s General Fund expenditures and transfers total $49.17 million, down $424,000 from the previous year, largely due to the early repayment of $5.87 million in public works loans last year. Additionally, various department expenditures came in below budget, benefiting from savings associated with staff vacancies.
Mayor Wu underscored that the city council’s decision in the last fiscal year to fully repay long-standing public works loans has fundamentally improved the current spending budget. As a result, San Gabriel has successfully removed itself from the ‘financially high-risk city’ blacklist.
