Long Beach council hears plan to smooth Tidelands oil revenue decline; staff warns of federal grant risk

Long Beach city staff presented preliminary budget projections and long-term strategies on the city’s dependence on tidelands oil revenue, telling the City Council on an unspecified date that the city must prepare for declining oil receipts and possible federal funding losses.

Budget staff said the Tidelands Fund currently supports major public safety and lifeguard services and that the city is accounting for reduced oil support in its general-fund forecast: “In our forecast ... we are accounting for the reduced oil support, year over year,” Budget staff said. Council members pressed for clearer timelines and contingency plans.

The presentation and council discussion focused on several interlocking issues: the accelerated timetable for the state’s oil transition created by SB 1137, the city’s existing set-asides for oil-abandonment and subsidence liabilities, proposals to repurpose interest on those set-aside dollars, and strategies to grow non-oil revenues such as entertainment, convention and real-estate development.

Why it matters: Tidelands dollars currently fund large recurring expenses. Councilmember Duggan noted the scale of those charges, asking whether the forecast accounts for $20,000,000 annually to fire and $12,000,000 to police that are charged to the tidelands fund. Budget staff…