Long Beach lawmakers were busy in 2023 with an emergency declaration on homelessness, hotel workers striking for higher wages and a cyberattack that resulted in the theft of some city data.

When 2024 begins, the city’s budget will be a crucial issue, with Long Beach’s financial health depending on how voters cast their ballots in November.

Here are three crucial issues to keep an eye on in 2024:

The city’s oil problem

Oil drilling has contributed hundreds of millions of dollars to the city’s budget over the decades. Long Beach knows this is a temporary source of revenue. It has pledged to end oil operations by 2035, but a new state law threatens to speed up that plan and blow a hole in the city’s budget.

Senate Bill 1137, which was authored by Long Beach State Sen. Lena Gonzalez, mandates 3,200-foot buffers around sensitive areas like schools, hospitals and homes and requires costly monitoring for emissions from oil operations that cause health issues.

The bill doesn’t require existing operations to shut down, but it would prohibit new permits needed to maintain wells — something that could shorten their lifespan. Long Beach officials have said about half the oil wells in the city are within the 3,200-foot buffers.

Voters will ultimately decide if this law goes into effect. Newsom signed it in 2022, but the oil industry successfully blocked it, at least temporarily, by qualifying a referendum for the November ballot.

If voters uphold the law, Long Beach officials say their oil revenue could dry up in 2029 instead of 2035. They estimate the law would cost the city approximately $122 million within the first five years.

A man runs along the water at Alamitos Beach near oil island Grissom in Downtown Long Beach Thursday, Sept. 29, 2022. Photo by Brandon Richardson.

For Long Beach, the problem is two-fold because it plans to use oil revenue to pay the costs of phasing out oil production. It’s expected to cost $1.2 billion to abandon wells in the city, and Long Beach has so far saved only half of the $154 million it is expected to pay toward that bill.

The revenue from oil production also goes into the city’s Tidelands Fund, which pays for city services within the Coastal Zone like lifeguards, police and fire personnel, and large projects like the Belmont Pool. The risk of losing that money already forced the city to scale back plans for the pool. Next on the chopping block could be city services.

Economics aside, Long Beach is also a city that prides itself on its sustainability efforts and SB-1137 has put the city in an awkward position where it is formally opposing a bill that is aimed at protecting residents from dangerous emissions while simultaneously trying to meet its own greenhouse gas reduction goals by 2030, when it hopes to bring emissions down 40% below where they were in 1990.

Voters will decide the fate of the law in the November 2024 election.

How high will Long Beach’s sales tax go?

State law has limited how high sales taxes can go, but a new bill signed by Newsom last year could let Los Angeles County exceed the previous mark — that is if voters want it to.

Assembly Bill 1679 was introduced by Los Angeles-area Assemblyman Miguel Santiago in early 2023 in an attempt to let Los Angeles County extend Measure H, the decade-long tax to fund homeless services, that is set to expire in 2027.

The quarter-cent sales tax has contributed about $14 million annually to Long Beach even though Long Beach residents didn’t have to pay the tax until 2023. To extend Measure H, the LA County Board of Supervisors, which has already signaled its support of the law, would have to place it on a future ballot.

But a new entity, the LA County Affordable Housing Solutions Agency (LACAHSA) also needs funding, so the supervisors would likely seek a half-cent tax hike (instead of a quarter-cent) to help fund both Measure H and LACAHSA.

Los Angeles County Supervisor Janice Hahn presents a $6.5 million check to the city of Long Beach to help purchase a building for a year-round homeless shelter. Photo by Jackie Rae

The math for Long Beach is more complex than most of the 88 cities in the county because of the city’s Measure A tax increase, which was supposed to sunset after 10 years but voters made it permanent in March 2020.

For the next four years, the city has agreed to divert 25% of Measure A revenue to the county to pay its share of Measure H, but after 2027 it’s expected that Long Beach will keep all of its Measure A revenue.

Long Beach, like many cities in LA County, is already at an effective sales tax rate of 10.25%, but if the county pursues funding for both LACAHSA and Measure H, it could make Long Beach one of a handful of cities with a 10.75% sales tax, the highest in the state.

The city has said that it’s still negotiating what will happen if the county puts the issue on a future ballot and it passes. This includes the potential for the city to pay a reduced rate to avoid the city’s sales tax rate rising to 10.75%.

It’s unclear when county officials could add this to the ballot, but there’s still time before the November general election.

What comes after the Homelessness emergency?

Long Beach signaled last month that it may end its current state of emergency on homelessness.

Last year, the city counted 3,447 people living in some state of homelessness in Long Beach, a 4.6% increase from the year before when the city saw a staggering 62% increase between 2020 and 2022.

Doing away with the emergency declaration doesn’t mean the city will stop trying to reduce homelessness, but it will mean things might move a little slower. The emergency sped things up by granting increased spending privileges to the city manager. Without it, more contracts will require a vote of the City Council before being signed.

A person who appears to be homeless sets up their tent on the fake grass at Lincoln Park next to the Billie Jean Library in Long Beach, Monday, Aug. 21, 2023. Photo by Thomas R. Cordova.

Long Beach has increased shelter space, but the expansion has been limited — and delayed.

The city says it has access to about 1,300 shelter beds and most are at or near capacity. It’s also facing unanswered questions like how it will keep paying for staff and services at motels converted to shelters once state and county funding runs out. There’s also the debate over what to do about Metro’s end-of-the-line policy that kicks people off trains at the end of the night. Residents and business owners have said this is driving up the number of unhoused people in Downtown where the Metro A Line ends.

Long Beach is almost entirely reliant on outside funding sources, whether it be the federal, state or county governments, to pay for its homeless services.

We won’t know until the next homeless count in early 2024 whether that money is reducing the number of people on our streets, but the issue — and finding funding for it — are likely to remain top priorities.

Jason Ruiz covers City Hall and politics for the Long Beach Post. Reach him at [email protected] or @JasonRuiz_LB on Twitter.