Associated Press reports California will allow schools, day camps, bars, gyms, campgrounds and professional sports to begin reopening with modifications starting next Friday.

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City Manager Details How Much Pasadena’s Economy Is Hurting

Published on Tuesday, March 31, 2020 | 5:20 am

City Manager Steve Mermell on Monday quantified what everyone already knew generally about the “major economic disruption” that Pasadena, like cities everywhere, is facing during the coronavirus crisis.

“I think we’re all adjusting to the fact that this may be longer than a few weeks — it may be measured in a few months,’’ Mermell said during a special session of the City Council.

Among the troubling points Mermell detailed:

  • Occupancy in local hotels has gone from about 80 percent to about 10 percent. “One of our local hotels three months ago had 480 staffers — today they have 48 staffers,’’ he said. “We’re hearing that some chains may just lock their doors.’’

  • “Sales-tax revenues are down, they’re projected to be down. They may be down as much as three-quarters (of a million dollars) to a million dollars next fiscal year, based on current projections.’’

  • “Ancillary revenues like parking citations are way down because, for the most part, we’re not writing those citations.’’

The convention center and the Rose Bowl are also facing major economic challenges as the city rides out COVID-19 shutdowns and stay-at-home orders.

CALPERS, the California Public Employees Retirement System, also is facing hurdles, Mermell said.

“There are no conventions at the convention center,’’ he said.

“The Rose Bowl has had to close the golf course; so, its revenues are essentially shut off. They have a million-dollar debt service payment due in June, then they have a $4 million payment in August. The Rose Bowl appears to have sufficient cash to get through the balance of the fiscal year, but depending where all of this goes, come the fall there may be a concern about their cash position.’’

As for the state’s retirement system, he said, “In early March, CALPERS boasted in excess of $400 billion in investments. By March 23, it was down to $335 billion – so a loss of $65 billion in a very short time.

“There’s been a bit of a market rebound since, but … if CALPERS were to lose 10 percent in the current fiscal year, but then earn 20 percent next year, the result would still be an increase in our unfunded accrued liability of about $150 million.

“So that’s a long-term impact that all cities are going to face if the markets don’t rebound.”

Mermell noted that the city website is helping direct business to hard-hit local restaurants, still open for take-out and delivery, and said the Chamber of Commerce has written a letter “with a series of suggestions (and) we’re analyzing those suggestions.’’

But the city can only do so much.

Mermell pointed out that, under President Trump’s $2 trillion federal stimulus plans, cities of Pasadena’s size are not at the front of the line for relief.

“From a local government point of view, it’s really a mixed bag, or kind of light in the bag, in you will,” Mermell said of the federal stimulus.

Mermell said that states will receive some $150 billion in stabilization funds, “but the direct funding will only go to local governments with populations over half a million. So, the City of Pasadena and most cities will not qualify for this.”

“There’s no requirement that the money be passed down from states to local agencies,’’ he said. “This was something that local governments were fighting for in the bill and didn’t get it.”

“Most of the assistance will be indirect. The city will not be receiving money directly.’’

And while the federal bill includes cash payments of up to $1,200 per adult and $500 per child, Mermell said, “those come with income limits which aren’t graduated for higher-cost areas of the nation, so that will work against high-cost areas like California and the East Coast.’’

Meanwhile, he said that about 60 percent of the city’s workforce is “working in their regular fashion (but) in some case taking turns or in shifts (such as police and the fire department)’’ – while about 30 percent of city staff are telecommuting and about 10 percent “are currently at home and don’t have an immediate assignment, but they’re available for us to use as needed.”

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