It’s mind-blowing to think about the amount of money that flows in and out of West Hollywood.
In fiscal year 2022, the city brought in $135,000,000 and spent only $113,000,000 — an intentionally lean year of expenditures that helped restore the city’s reserves, now at $155 million, back to their pre-pandemic levels.
At Thursday, Finance & Budget Subcommittee, Mayor Sepi Shyne and Mayor Pro Tem John Erickson tried to capitalize on the good news.
“So we’re not seeing any negative impacts of the hotel worker ordinance or the minimum wage increase?” Erickson asked City Manager David Wilson.
“It’s hard to say,” Wilson replied, noting that the city doesn’t know the expenses private businesses incurred.
This year’s revenues are already exceeding expectations, and City Hall appears ready to go shopping, with an estimated $139.6 million in budgeted expenses by the end of the fiscal year.
Where does that money come from?
| Revenue Source | Percentage |
|---|---|
| Sales Tax | 26% |
| Transient Occupancy Tax | 22% |
| Property Tax | 18% |
| Other Taxes | 10% |
| All Other Revenues | 09% |
| Parking Fines | 05% |
| Parking Meters | 05% |
| City Permits | 04% |
Most of it comes from sales tax (26%), then from taxes on hotel stays (22%), followed by property taxes (18%).
The city is making bank from parking meters, permits and penalty fees, which brought it in almost $14 million in fiscal year 2022. That’s a whopping 10 percent of WeHo’s budget — the average American city only generates 3% of its revenue from that source, according to National League of Cities.
And where is this money going?
| Expenditure Category | Percentage |
|---|---|
| Personnel | 34% |
| Public Safety Contracts | 22% |
| Other Contract Services | 21% |
| Operating Costs | 08% |
| Financing Uses | 07% |
| Social Services Contracts | 05% |
| Capital Projects | 03% |
More than one-third of it is spent on personnel for the city.
The city’s FY23-24 Operating Budget says:
Personnel costs are the City’s single largest operating expenditure, accounting for approximately 37% of General Fund operating expenditures in the FY23 budget. The compound annual growth for personnel costs from FY19 to FY24 is 6% and includes the addition of 19 new staff members over the same period.
20% goes to public safety contracts, including the L.A. County Sheriff’s Department, L.A. Fire Department and the Block by Block security ambassador program.
The “wealth” of social services touted by city leaders only gets 5%. Operating costs come in at 8%, “financing uses” 7% and a mere 3% goes to capital projects — roads, parks, etc.
The conspicuously vague “Other Contract Services” gets 22% — this year, that’s looking like more than $30 million.
Other points of interest:
- Cost-of-living increases bumped expenditures across the board, some as high as 7.6%.
- It looks like the Sunset Strip will be getting security ambassadors, according to Mayor Pro Tem John Erickson. Block by Block’s budget increased by $2 million to staff the positions City Council requested.
| Name | FY2020 Actual | FY2021 Actual | FY2022 Budgeted | FY2023 Budgeted | FY2024 Budgeted |
|---|---|---|---|---|---|
| Legislative & Executive Department | $5,824,223 | $6,682,356 | $6,722,967 | $5,021,204 | $4,865,556 |
| Administrative Services Department | $10,489,160 | $4,466,329 | $4,498,298 | $7,956,998 | $8,001,740 |
| Finance & Technology Services Department | $16,972,602 | $12,008,397 | $16,560,997 | $17,993,522 | $18,532,566 |
| Public Safety Department | $25,328,892 | $23,603,849 | $23,816,077 | $27,669,644 | $28,079,803 |
| Human Services & Rent Stabilization Dept | $10,768,988 | $11,356,880 | $10,621,524 | $13,007,299 | $15,109,377 |
| Facilities & Recreation Services Dept | $15,958,061 | $13,908,198 | $19,022,884 | $23,463,239 | $24,193,534 |
| Planning & Development Services Dept | $8,967,512 | $7,180,729 | $8,506,216 | $9,163,390 | $9,059,142 |
| Public Works Department | $10,129,689 | $9,475,704 | $10,147,596 | $11,652,197 | $12,260,891 |
| Communications Department | $3,380,130 | $3,491,779 | $4,073,112 | $4,315,281 | $5,124,447 |
| Economic Development Department | $2,284,932 | $1,366,051 | $1,510,977 | $3,351,815 | $3,511,432 |
| Development Impacts | $1,146,521 | $1,718,711 | $2,096,365 | $1,713,576 | $1,762,555 |
| Community Services | $3,997,449 | $2,812,923 | $3,322,834 | $4,936,256 | $5,124,678 |
| Total Expenditures: | $115,248,159 | $98,071,906 | $110,899,847 | $130,244,420 | $135,625,721 |
No impacts. The world’s gayest Starbucks Closed to make an example of WeHo.
BTW – don’t drink coffee and never been in our now gone or any other Starbucks
I think it is important to note, that TOT, and sales tax, which is 48% of the City’s revenue, is largely paid by people who don’t live here. People who visit the city, stay in the city in its hotels, or come to the city on weekends and visit the nightlife and restaurants. Residents benefit from this. It doesn’t all just go to salaries for City employees. Yet, many residents want to micromanage how the City spends its money, even when it benefits residents.
It’s time to lower the city’s sales tax by 0.75%.
We raised that tax when city revenue dropped earlier in the pandemic.
But there’s no reason to keep paying that higher sales tax. Cut that tax and force the city to live on a budget.
It’s a great idea, but if WeHo lowers the sales tax rate, the County can and WILL grab the 0.75% for its coffers. We should have demanded a referendum on the increase and restricted its use. Too much money in unrestricted general funds in the hands of an inexperienced council members is no bueno.
this is true, thats what we are told, but has not happened in the ‘other cities’
Good point.
We should look at the language that the city of Beverly Hills used on this issue around the time WeHo raised its sales tax during the pandemic.
Beverly Hills decided it would raise its sales tax by the maximum allowed increase of 0.75%–but ONLY if the county tried to raise county sales tax by 0.75%. Smart strategic move by Beverly Hills to hedge against a money grab by the county.
https://beverlypress.com/2020/08/beverly-hills-to-put-sales-tax-increase-to-voters/
So the City of West Hollywood acknowledges that the cost-of-living has increased as much as 7.6%, and adjusts their budgets and salaries accordingly–yet they limit rent increases to only 3%. It makes no sense, property maintenance, mortgages, and costs have also increased 7.6%! The former rent increases based on CPI was more fair and equitable for everyone involved.
The dirty little secret is most of that impressive sales tax money, is tax on the City being pushers of alcohol sales. When the drunks the city makes ruin their lives, whether here or elsewhere, weho doesn’t have to be burdened with those costs. Our City Council pushes them to ruin their lives with excessive drinking, and they pretend it doesn’t happen. Thank you City Council, for pushing so many thousands to ruin their lives, so we can get some more sales tax money to give away free stuff to freeloaders. What a model forumula they have figured out.
With weho’s onerous parking tix I’m amazed that money is only 10% of the take!
Can we talk about the AI generated image with this article rather than an actual photo of a west Hollywood street corner? Lol
Yeah the gibberish on the signs gives it away!
Erickson’s intellectually lazy leading questions reveal an inability to articulate a rational and cohesive commentary. In a legal environment, they would find objection and sustainment every time.
Happy to hear we’re so flushed with cash…now can we hire more police, increase sidewalk cleaning, Thank you.
Walk through town. Looks like a 3rd world run down place.
John Erickson is too invested in rewarding his friends and colleagues at City Hall with undeservedly high salaries and pensions.
His type of unethical wheeling and dealing has no place in government and hurts residents and taxpayers.
John Erickson is also w Planned Parenthood where anyone can walk in, self diagnose and get a prescription for surgery to begin their transition. It’s as simple as ordering a coke. Horrifying. Will Erickson & Shyne soon become interchangeable in a manner of speaking? Anything for press coverage.
Hmmm….thank you for educating us with this information about Planned Parenthood. About that “self diagnosis and free prescription for transitions surgery”, can that happen same day? Please let us know how this works.
Don’t have the particulars, you might want to call them.
Whatever your personal issues are with John Erickson, Planned Parenthood has done great work for communities across the country for years. For many, it is the last refuge for care.
Planned Parenthood has its place, don’t agree with all its policies but they are being used by Erickson. An endless cycle, not particularly an ethical one.
Degrees in Women’s Studies, American Religious History, Queer Studies in Religion……..Where does it state that this individual is competent in Budget Affairs? A smart mouth about public affairs strategies does not qualify one for these decisions. Look past the talk folks and focus on the substance. This is who we elected because we were impressed by his titles.
Estimated total pay package for Director at Planned Parenthood $172,000./year. By the way, they only hire activists as indicated by them .Entrenched bureaucracy everywhere you turn.
…he makes that much annually, on top of his kick backs on CC, and he still looks a dysphoric refrigerator with legs?
Time to start shopping for additional Sheriff Deputies. Get this city safe to do business in again and restore resident confidence when walking down the street.
Over the years West Hollywood has seen a huge increase in money spend on infrastructure, which is generally a good thing as we can see where and how our taxes are spent. But the other area of growth in at City Hall. The City’s organizational chart is top heavy on management and our generous compensation will continue to fuel a rising debt for pensions. While costs of the Sheriff are not cheap, public safety should not be shortchanged when we are dependent upon visitors feeling safe when the come to support our local businesses. Having a budget committee of our… Read more »
Thank you Steve for this comment.
I’m not sure how you are defining infrastructure, but my definition includes things you can really see that weren’t there before. Like widening of streets, building a subway station, adding high speed bus lanes. Maybe you can include a handful of parking structures and fixing up the parks a bit. Honestly, the city has hardly anything to show for infrastructure improvements. I don’t see any new airport, highways, tunnels, bridges etc. The city spends huge amounts of money to reward many employees we really don’t need, basically so the freeloaders will continue to vote for the worthless Sepis of the… Read more »
Not to be argumentative, but in a relatively short period of twenty years since we finally started focusing on infrastructure we would have had flooding this last winter if it were not for the huge new sewer lines installed when we re-structured Santa Monica Blvd.; indeed once that project was completed hundreds of homeowners got to stop paying for extra-flood control insurance saving most about $800 to a thousand a year. We have a really nice library and people love the pool and the new dog park in West Hollywood Park. We replaced and expanded a tiny fire station on… Read more »
I agree that the city made significant strides in its first 36 years, however, there is a very real sense throughout the city that we are in a slide and that slide started two years ago. We no longer have visionaries on council, we have inept egotists who tinker with our safety, among other things.