The newly formed Santa Barbara South Coast Chamber of Commerce held its first ever State of the City event on Friday morning for Carpinteria, its southernmost city.
During the virtual event, Carpinteria Mayor Wade Nomura, City Manager Dave Durflinger, and UCSB economics professor and Economic Forecast Project Director Dr. Peter Rupert spoke about how Carpinteria’s economy and government have weathered the COVID-19 pandemic, as well as what might be expected for the city in the near future.
After opening his speech by stating general goals of strengthening Carpinteria’s community, protecting its environment, retaining its small-town feel, and advancing its youth, Mr. Nomura reviewed some of his city’s policies and accomplishments.
These included transferring the Carpinteria Library into the city of Carpinteria organization, reduced crime in the city, and over $1 million being made available for infrastructure and transportation through the Measure X sales tax. One major project to be funded by Measure X money is a destination bike bath connecting Padaro Lane all the way to Rincon.
“This will create hundreds of miles of bike path and make this a world-destination spot,” Mr. Nomura remarked.
The mayor also mentioned the creation of two committees to address the issues of racial equity and social justice, one that looks at policies and procedures that promote these things, and the other a blue-ribbon committee of two City Council members and community members to advise on local equity needs.
The mayor said, “The difference between equality and equity? Equality is treating everyone the same. Equity is something where you actually balance it with fairness also.”
City Manager Dave Durflinger followed the mayor with a report on the city’s finances and what changes to Carpinteria under COVID-19 might be permanent. On the former, he said the city’s budget this year, $19.4 million, is about 10% less than last year’s funds. Due to this, the city is digging into its rainy-day fund and has enacted a hiring freeze and pay freeze in order to live within its means.
Carpinteria’s biggest source of funds was property taxes, $4.4 million, and sales taxes, $4.2 million. Its biggest expenditure was on wages and benefits for City employees, $5.2 million, followed by capital projects, $4.9 million
Carpinteria experienced a decline in transient occupancy taxes, which took a 20% drop from $2.6 million in 2019 to $2 million in 2020. It had a 10% drop in its 1% sales tax, $1.9 million in 2019 and $1.7 in 2020.
Dr. Rupert spoke more broadly about the greater economy.
The economist said that as we’re half a year out from the onset of COVID-19 lockdowns, the economic recovery couldn’t be referred to as “V-shaped,” as that sort of recovery takes only a few months.
Many of Dr. Rupert’s remarks on the economy had an uncertain tone.
“It’s very difficult for us to understand where we exactly are in terms of health, in terms of the economy,” he said.
He added, “The Federal Reserve met (Thursday) and they basically said they’re going to keep interest rates down at around zero for another couple of years. That tells me there’s uncertainty out there and they’re certainly worried.”
Comparing various economic sectors this past July to July 2019, Dr. Rupert said most sectors haven’t experienced a positive increase since last year.
Whereas there were 7,100 employed people in Carpinteria between the months of April and November 2019, the city had only 6,100 people employed during the months of April and May this year.
The normal number of unemployed people in Carpinteria is around 200. According to Dr. Rupert, it has risen by a factor of 400 to 800 unemployed people.
Though many sectors are struggling, Dr. Rupert there are some that are “doing great.”
“In fact, residential real estate doesn’t even blink an eye at the pandemic, it turns out,” he said.
This, he said, is likely due to better equity in terms of businesses and households making people “safer” and “less leveraged” than in the 2008 Recession and therefore better able to withstand loss of employment. On that note, he recommended being better prepared for future pandemics.
“What we need to do in the future is we have to be better prepared. We need to be better prepared for pandemics, this is not the first pandemic,” he said.