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“We will overcome these challenges because Santa Barbara is resilient,” she said at the virtual event, sponsored by the Santa Barbara South Coast Chamber of Commerce. “This is a city of determined and hardworking people, and we have recovered from past disasters.”
Speaking at a podium outside against the backdrop of the Santa Barbara City CollegeWest Campus lawn, Murillo said the pandemic and its impacts that followed are still playing out, and it will take time to fully recover.
“The council’s posture will remain legislatively vigilant,” she said. “We are focused on preparing for the long road to full recovery, a new investment, by initiating efforts to reduce red tape and streamline land development permitting in the city.”
It is about eight months into the pandemic. Murillo touted Santa Barbara’s pandemic response and the partnerships with local organizations to assist those most affected by COVID-19.
She said Santa Barbara provided additional funding for social services throughout a partnership with United Way of Santa Barbara County and entered into new partnerships with the Santa Barbara Foundation to offer small-business grants.
“For those businesses that have had to close or those that are struggling to reopen and recover,” Murillo said, “my heart goes out to each and every one of you. We will continue to keep our resident and business needs in focus.”
In the early weeks of the pandemic, Murillo said she called on Santa Barbara’s business community to gather ideas and solutions through a business advisory task force in response to the economic impact of Gov. Gavin Newsom‘s stay-at-home order as well as school closures and nonessential business closures. The task force, made up of 20 business members, participated weekly for three months.
“Those initial solutions were the foundation to our climb back,” Murillo said during her 15-minute address.
A recommendation led to the Santa Barbara City Council’s authorization to close lower State Street to cars to allow restaurants to expand their dining outdoors amid the COVID-19 pandemic. The city decided in May to close parts of downtown State Street, and it created a “new public space in the center of downtown to interact with neighbors and enjoy our new village center,” she said.
Homelessness is a constant challenge in Santa Barbara, Murillo said, and the COVID-19 pandemic has only exacerbated the issue by limiting the city’s ability to clear homeless encampments under public health order.
“The city is focused on making an impact with multiple new initiatives to address this longstanding problem,” Murillo said about homelessness.
A wide range of solutions are required to tackle the varying needs of individuals experiencing homelessness, she said.
The Santa Barbara Connect Home program focuses on the needs of the most vulnerable people experiencing homelessness. Murillo shouted out the newly established partnership among the city, Cottage Health, the Santa Barbara Police Department, the Housing Authority of the City of Santa Barbara and PATH Santa Barbara.
Other efforts focus on preventing vulnerable residents from becoming homeless.
Santa Barbara received federal funding to address the pandemic through the community development block grant program, according to Murillo. Funds were provided to offer three months of rental assistance to at-risk households, she said.
Murillo said the city helped establish a new Community Food Collaborative, a multisector partnership. The program aimed to address hunger among unsheltered populations in Santa Barbara in response to COVID-19 while also supporting small food businesses, according to the Community Food Collaborative.
Santa Barbara’s Average Unit-size Density Incentive program, known as AUD, had produced more than 430 new housing units in the past seven years, with 302 units approved “that can be constructed in the near future,” she said. “This level of housing production hasn’t occurred since the 1970s.”
The city is updating its accessory dwelling unit ordinance to align with California law. Santa Barbara permitted 350 accessory dwelling units, colloquially known as granny flats, since 2017, Murillo said.
“Applications continue to come in at a steady pace,” she said.
Murillo said Santa Barbara completed 27 capital improvement projects in the past year, with a total value of $150 million. There are 18 capital improvement projects in construction and 30 in design, Murillo said.
“These investments will improve access and connections to the waterfront, and our downtown,” she said.
The Santa Barbara Library‘s plaza on Anapamu Street will serve as the central hub for the city’s arts district, and its revitalization coincides with the new vision for the downtown area, Murillo said. The project calls for improving the library’s outdoor space to accommodate events and programming.
“The library continued its excellent work engaging, educating and enhancing our community,” Murillo said.
Santa Barbara set a goal of becoming carbon neutral by 2035, Murillo said. The city is working on several initiatives to help achieve this goal, including the community choice energy program.
The mayor used her prepared remarks for her third annual State of the City address to call attention to racial injustice and social inequity, and how deaths of black citizens involving law enforcement officers refocused the national and local conversation. She spoke of George Floyd, who died in police custody, in Minneapolis in May.
“This death sparked a national awakening of the Black Lives Matter movement and the need for racial justice,” Murillo said, mentioning Healing Justice Santa Barbara and organizations that are partnering with Santa Barbara on what the city can do to address issues of systemic racism and social inequity.
The Santa Barbara City Council is establishing the city’s Community Formation Commission to advise on the creation of a civilian police review system for the Santa Barbara Police Department.
“The city is listening and responding,” Murillo said. “We are committed to police operations that are responsive to our community and free of brutality and misconduct.”
Santa Barbara has “one of the finest police chiefs in the state, Lori Luhnow, and dedicated professional men and women in the department who are committed to serving our residents with transparency and community engagement,” Murillo said.
Luhnow, the first woman chief of the Santa Barbara Police Department, began her position in July 2016.
Murillo also acknowledged the Santa Barbara City Council’s action to rename a street on Santa Barbara’s Eastside. Indio Muerto, which means dead Indian in Spanish, is being changed to Hutash Street, which means Earth mother.
“The change will remove a hurtful public street name from our city,” she said.
Local Economy and Santa Barbara’s Financial Outlook
City Administrator Paul Casey said local economic effects of the pandemic were “severe.” He provided an update on the local economy and Santa Barbara’s financial outlook.
Santa Barbara received “very little federal assistance,” he said. The Santa Barbara Airport got about $9.5 million in relief funding, and the state provided a little more than $1 million in CARES Actassistance that covered some public safety expenses.
Casey said the city received about $500,000 in community development block grant funds for human service purposes.
“At this point, we are not expecting or planning for additional federal assistance,” he said, adding that state and local governments need federal assistance “to get us through these times.”
Casey said $6.7 million in the city’s reserve funds were used to cover the initial deficit in fiscal year 2020, and the city expects to use a “more modest amount of reserves to see us through the fiscal year 2021.”
“What is unique about this budget event considered to others is every category of city revenues has been impacted and stressed,” he said.
Sales tax and bed tax are the two largest revenue sources affected by Santa Barbara’s budget. The bed tax revenues were 33 percent lower than August 2019. The local tourist industry took a hit amid the COVID-19 pandemic.
“A dramatic drop, but we are seeing steady growth month over month in our bed tax revenues,” he said. “So far, it’s right in line with our budget projections for this fiscal year.”
The latest sales tax information from the state will be available in November.
The pandemic forced Santa Barbara to take dramatic actions to address the fiscal impacts to the city’s operating budget, Casey said.
The city laid off about 400 part-time or hourly employees. These were seasonal or hourly workers who supported after-school activities, summer camps, parking kiosks and “other similar activities that were fully shut down, so we had no work to offer,” Casey said. “As those services are coming back, we are rehiring those staff.”
A citywide hiring freeze went into effect, some capital improvement projects were put on hold and city departments began to cut their budgets in response to the COVID-19 situation, Casey said.
“These immediate and decisive actions saved the city’s general fund millions of dollars,” he said.
Casey said that “establishing a budget in the middle of the onset of the pandemic was one of the most challenging budget processes I’ve experienced in 30 years.”
In closing, Jason Harris, Santa Barbara’s economic development manager, addressed the city’s economic development initiatives.
Harris said Santa Barbara quickly became a statewide leader “as we were one of the earliest and most aggressive jurisdictions” to support outdoor operations at businesses during the COVID-19 pandemic.
The revamped State Street downtown promenade made the area more pedestrian-friendly and features the installation of parklets for expanded outside service.
The actions “saved countless businesses from closing and hundreds of jobs from being lost,” Harris said.
More upgrades along downtown State Street are in the pipeline, including lighting and roadway enhancements to provide better direction for cyclists.
“These are interim steps,” Harris said. “The city has initiated a visioning effort for the future of State Street.”
Santa Barbara is the second of the four-part State of the City series hosted by the Santa Barbara South Coast Chamber of Commerce. The leading business-support organization held the State of Carpinteria in September, and it will continue the event series by hosting the State of Goleta in November and the State of Santa Barbara County in December.