At the July 9, 2019, City Council meeting, the Garden Grove City Council discussed the idea of implementing an annual City Council budget appropriation whereby each council member, including the mayor, could be allotted a set amount of dollars to utilize within their respective districts or citywide. Along these lines, the City Council directed staff to survey cities in Orange County to determine if any cities with districts provide each of their city council members with an annual budget appropriation. For those district cities with budget appropriations, the City Council requested that staff research the annually appropriated dollar amount, past and present uses of the funds, oversight practices, and funding sources.

City staff surveyed each of the 34 incorporated cities in Orange County and ultimately learned that 15 of the 34 cities have districts while 19 do not. Of those 15 cities, only three currently provide each of their city council members with some sort of set annual budget appropriation for use in the community. Santa Ana, Seal Beach, and Newport Beach each appropriate annual budgets for their city council members, ranging from $6,000 to $20,000 (see table). The remaining 12 cities with districts either did not have a set annual budget appropriation for each council member or were still in the process of transitioning to district elections. In fact, six of the 15 district cities in Orange County have only partially transitioned to district elections with transitions expected to be complete by the 2020 and 2022 November elections (see table).

Additionally, staff’s survey of the Orange County cities showed that most cities, whether district cities or not, already have an established council account or operations budget to support city council administrative staff, travel and training expenses, as well as other reoccurring council costs. For example, the City of Anaheim allocates approximately $72,000 annually for each of its council members to use solely for hiring administrative labor support and aides. Like Garden Grove, other cities including Costa Mesa and Dana Point also have sponsorship and discretionary funds that are shared by the entire city council. However, only Santa Ana, Seal Beach, and Newport Beach currently have individual budget appropriations for each city council member to use on an annual basis.

City of Santa Ana (6 Districts - $10,000)

The City of Santa Ana’s Special Event Sponsorship Program provides the mayor and city council the opportunity to allocate sponsorship funding up to $10,000 per fiscal year (contingent upon annual City Budget approval), for special events conducted by qualified nonprofit organizations or City-recognized neighborhood associations. City council members may utilize these general fund monies anywhere in the city (not just in their respective districts) with oversight from the City Manager’s Office. In the past, council members have used these funds to sponsor student fashion shows, assist with high school football fundraisers, support Planned Parenthood marches, and sponsor grand opening ceremonies for nonprofit organizations. Any unexpended dollars are NOT carried over into the next fiscal year budget. The Santa Ana City Council also has a separate $14,000 allocation annually for community events and neighborhood projects.

City of Seal Beach (5 Districts - $20,000)

The City of Seal Beach provides each of the city council members and the mayor with an annual budget of $20,000. City council members may utilize these general fund monies anywhere in the city (not just in their respective districts) with oversight from the City Manager’s Office. City council members have used these funds to pay for Main Street aesthetic improvements, plant trees, donate to general care centers for kitchen upgrades, and improve park equipment (shade structures and playgrounds). Unlike Santa Ana, however, Seal Beach allows for unexpended dollars to be carried over into the next fiscal year budget if it is being utilized for an ongoing project or purpose.

City of Newport Beach (7 Districts - $6,000)

The City of Newport Beach’s District Discretionary Grant Account allows the city council to direct revenue towards worthy projects or programs which the city council deems beneficial to Newport Beach residents’ quality of life. The city council sets the annual allocation amount for the District Discretionary Grant Account during the budget process and all city council members, including the mayor, receive the same budget allocation. Expenses must have an “identifiable public benefit” and must align with the city council’s priority of focusing on local groups within Newport Beach, regional groups in Orange County, and more broadly, other groups in California that benefit Newport Beach residents. In the past, council members have used these funds to sponsor the annual Balboa Island Improvement Association parade, support the Bayside Village HOA parade, and donate to the Boys & Girls Club. Any unencumbered funds are deposited in the General Fund Reserve Account and expenditures are reported to the city council annually.

City of Garden Grove

The City of Garden Grove maintains a City Council Contingency account, which contains $41,365 that can be used at the City Council’s discretion for projects or needs that may come up during the year and are not separately budgeted. These funds can potentially be allocated proportionally for use by council members within each district as well as by the mayor citywide.

There is no additional financial impact should the City Council wish to implement district budget allocations within the City’s Council Contingency account.

Should an allocation of the City Council Contingency account be considered, it would equate to approximately $5,000 for each council member and the mayor. The remaining $6,365 in the account would still be available for use at the Council’s discretion. It is recommended that all purchasing policies and practices currently in place be adhered to and that the expenditures be administered through the City Manager’s office. Periodic reporting could be shared through the City Manager’s Weekly Memo to the City Council. It is recommended that the City Council consider this report and provide direction to staff.