Economic slowdown predicted to affect Yorba Linda's sales tax revenue; solar canopies proposed for parking lots at three city facilities

 

A predicted economic slowdown affecting Yorba Linda sales tax revenue and a proposed solar energy conservation program at three city-owned facilities merit attention this week.

The city's property and sales tax consultant is predicting “a bit of a slowdown in the economy” in the latter half of the fiscal year that begins July 1, according to a report to the City Council by Assistant City Manager Dave Christian last month.

The slowdown is expected to impact the city's sales tax income, which is projected to “remain flat” for the fiscal year ending June 2024, and increase by only 2.3% for the fiscal year ending June 2025.

The consultant, Brea-based HdL Companies, provides the city with a multi-year forecast of property and sales tax revenues based on trends in the broad economy and unique factors that impact these revenue sources in Yorba Linda, Christian said.

“Utilization of this consultant improves the accuracy of the city's revenue forecast on the city's two largest revenue sources,” noted Christian. Property taxes bring the most revenue for city coffers, estimated at 52.7% and 53.3% for the fiscal years ending June 2024 and June 2025.

“It is anticipated that the slowdown in the real estate market that the region has experienced over the last several months will impact the second year” of the city's 2023-25 budget, Christian said, with property tax growth projected at 3.7% and 3.2% for the next two fiscal years.

A solar energy canopy project proposed for the parking lots at the Community Center, Library and Arts Center and the Black Gold Golf Club was put on hold after a 30-minute presentation and discussion at a June 6 council meeting.

Despite strong support from Mayor Gene Hernandez, potential action on the project was delayed until the July 20 meeting. A planned timeline put project completion at early-mid 2025, if approved.

The parking lots for the three city facilities were identified by San Francisco-based Forefront Power as meeting criteria for using the solar canopies to offset energy costs at the locations, with savings estimated at $2.7 million over a 20-year period.

Forefront would finance, design, construct, own, operate and maintain the canopies, with the city paying Forefront a 20-year flat rate for the solar energy generated and delivered on a per kilowatt basis, according to Christian, presumably less than the current electrical expense.

At the end of the 20-year contract period, the city would have the option of entering into a new agreement or having the canopies removed without cost to the city, Christian said, noting that Forefront would reimburse the city if the project didn't deliver at least 95% of promised energy.

Among reasons for delaying action were council member concerns about the aesthetics of the structures, with the word “eyesores” mentioned by Beth Haney; the lengthy 20-year agreement time period; and the number of sites in the proposed project.