Santa Monica’s financial freefall: a warning to cities that rely on transfer income

The city of Santa Monica announced its fiscal woes, as sales tax revenue fell by a 20% decline, operating costs and delayed maintenance costs, resulting in a $16 million deficit in the city. The city council approved emergency measures, including cuts in spending, delaying projects and raising fees, which are expected to bring in $3.2 million in fiscal revenue each year. The state government may regulate after a financial review within 60 days.