City of Laguna Woods

Overview

• From FY2017-18 through FY2020-21, City revenues grew at a low annual average rate (0-3%), below historic long-term inflation (3%). 
• During that period, expenditures grew at a moderate annual average rate (3-6%), above revenue growth and above historic long-term inflation (3%). Revenues generally exceeded expenditures, contributing to reserves, except FY2018-19 which showed a slight shortfall and reserve decline.
• The California Auditor ranked the City’s financial risk as 414 out of 423 (1 is riskiest) in FY2019-20.
• The City’s FY2022-23 budget projects revenues exceeding expenditures, however transfers to other funds and to reserves slightly reduce the General Fund ending balance.
• The City has taken steps to manage its OPEB liabilities but has no control over contracted Sheriff pension liabilities.
• Law enforcement costs continue rising faster than inflation, “…causing anticipated stress down the line” (MSR Survey/Interview, 2022).