Economic Ups, Downs Highlighted In State Of The City Address

PALM SPRINGS-Palm Springs Mayor Steve Pougnet said Tuesday the city will undertake a major financial review in light of the state and national economic crisis.

“These are unprecedented times,” Pougnet said in his second “state of the city” address since being elected in November 2007. “Palm Springs is no different, absolutely no different,” he said, speaking from the ballroom of the Riviera Hotel.

Pougnet said the city is challenged by California’s current budget crisis because the state has deferred $700,000 of infrastructure projects in Palm Springs.

“It’s unfortunate the state so often goes right down to the local community to balance their budgets,” Pougnet said.

The city will look for ways to release $500,000 for infrastructure projects, the mayor said.

“We are fortunate in the city of Palm Springs,” Pougnet said. “We started tightening our belts nine months ago.”

The city has a $1 million budget surplus this year, but Pougnet said the figure is a little “misleading.” Hotel tax revenue is down nearly 12 percent and could go even lower, he said, and utility tax revenue has also dropped.

On the brighter side, Pougnet said sales taxes are “holding their own” and property tax revenue is up $700,000.

Pougnet said the city council will be meeting to try to avoid making cuts in services and projects.

“We will be talking about some of the things we have to do to ensure that we are viable moving ahead in the future without cuts,” Pougnet said.

Pougnet highlighted several projects that are moving forward, including the opening of the ACE Hotel this week and the remodeling of the Desert Fashion Plaza.

Pougnet said the city is “fast-tracking the remodel” and has pledged to provide funding for infrastructure for the project. The vacant mall is viewed as one of the keys to revitalizing the downtown Palm Springs shopping area.

Despite the economic downturn, the city has continued to work to revitalize downtown, the mayor said.

“Despite all the media and newspaper articles, our downtown is not dead,” said Pougnet who noted that there are currently more than 500 operating businesses in the uptown and downtown areas.

“I’ve got to tell you there is a vibrancy still in our downtown that no other valley city has,” Pougnet said.

He outlined several ordinances passed over the past year to boost downtown business, including a business retention program and a business facade program.

The city is also looking to promote itself to bring in more tourism dollars.

Pougnet said the city is looking to appoint a “branding czar” to streamline messages of the airport, local businesses and the city. He said it is “not good” that Palm Springs is known worldwide as several different things.

“It’s time to grab hold of all these different messages as we evolve into one,” he said.