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Beaumont California is planning for sustained modest growth for 2019 as is prepares its budget for 2019-20 fiscal year.
Todd Parton, the Beaumont City Manager, informed the council about his plans at a special council workshop this pastFebruary.
Parton explained that he met with the Claremont McKenna College staff as well as attended an economic development summit to help him prepare for the budget.
The unemployment level is currently at an extremely low level while interest rates were a concern at the beginning of the year due to the feds rate increases in early 2019. The fears of higher interest rates have since subsided with decreases in interest rates as we headed into the buying season during the summer months.
Mortgage rates to have crept up from 4.9 percent in 2018 to 5.37 percent in early 2019 although interest rates are starting to see a decline which may result in more growth than anticipated. In addition, homebuyers can get an FHA loan with very little down money required.
The residential development is rapidly dropping due to investors not investing in developing more land. Investors see a reduced profit in new construction because of increased land and building costs.
The budget for 2019-20 will see an increase in the general fund revenue by 3.5 percent while this year’s budget saw an increase of 7.5%.
The proposed budget will have an increase of $535,000 in general fund spending.
A recession is highly likely in 2020-21 with the way things have been trending. Recessions hit in multiyear cycles, occurring almost every five to six years.
Other factors that may impact Beaumont are the new commercial and retail development. Additionally, the new industrial development that is happening, such as Amazon and residential growth taking place in the many local communities.
Residential growth would be a positive movement for Beaumont. The construction of new homes would support local businesses and add revenue to the local government.
Beaumont’s new home construction has seen a reduction of 15%. There is a projection of 600 new homes, of which 523 already completed. According to IE Real Estate , there are several additional communities currently being constructed with Beaumont.
Beaumont is expected to see a significant reduction in applications for building permits in fiscal years 20-21 through 22-23.
The reduction in permitting occurs in cycles every three years, the last period of reduced permitting occurring between 2007-08 and 2010-11.
Commercial growth is directly impacted by population growth. Beaumont has experienced fluctuations in population growth in.
Beaumont will look ahead and consider its future population numbers when making budgeting decisions.
Beaumont is expecting its population grows by approximately17,400 over the next 20 years. That will give Beaumont’s a population close to 67,000 by 2038.
The city is estimating that by 2038 it will issue an estimated 780 commercial permits.
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