Santa Cruz-Is Your City Financially Healthy? - Central Coast News KION/KCBA

Santa Cruz, Calif. - Is Santa Cruz financially healthy? There is a consistent refrain from city leaders "we're stable". But...Santa Cruz has had to make significant reductions to stay afloat. Here's what we found in this center for investigative action instant investigation.

The city has lost 4 and half million dollars in redevelopment revenue from the state. It's tantamount to robbery say the city's leaders. Add to this the loss of revenues and an 8 million dollar deficit 2 years ago and the city had to make significant fiscal desicions to to stave off bankruptcy.

Santa Cruz city staff and the city council worked hard to make reductions. City employees agreed to a 10% reduction in compensation; the work week was reduced to 36 hours; employees have increased their PERS and health contributions; the city has reduced park and public safety services and there has been a 20% reduction in the city labor force.

But the good news is Santa Cruz has conducted an organizational review to plan any further downsizing; formed city council task forces to come up with bold new revenues streams and is attempting to further expand business partnerships.

While the city has a 3 million dollar deficit this year the consensus is that they'll be able to close this budget gap. And with the Hotel Tax measure on the November Ballot many in the city believe raising the Hotel Tax from 10 to 11% will be a revenue generator badly needed. A plan is in the works to add over 500 new hotel rooms.

But Santa Cruz is not out of the woods financially. In fact no California city is with the state government bent on looking to municipalities for money for it's own revenue woes.

If you'd like our Center for Investigative Action to look at your city email Jon K Brent at: JonKBrent@KIONrightnow.com or tweet me @jonkbrent