By some accounts, the 1990s were a boom for California. The state had become a haven for techies and dot com businesses, when once the gold rush enticed miners. Home prices skyrocketed in and around Silicon Valley and people everywhere looked to California as the land of extreme wealth and opportunity.

By other accounts the 1990’s were a bust for California. The increase in population included an influx of unskilled workers, the state was still recovering from the last recession, and the “gold” surrounding Silicon Valley was not to be found in other areas.

In Fontana, the times reflected the darker side of reality. Dozens of city staff were laid off.  On the street, the situation was best expressed with the Fontana Herald News headline City on the Brink of Bankruptcy.  People affected by lay off within the city or elsewhere were left scrambling for a means to support their families.

Investments in infrastructure had not been made by the City in over fifteen years which was just as devastating as the loss of jobs. Ongoing legal battles in the 1980’s had also cost the taxpayers. In the calm before the storm, money (to include reserves), had been spent on increasing staff and investment in new development without taking stock in what was happening in the economy at large. The great recession of the 90s was truly a lesson learned for Fontana.

Today, in 2009, a recession has hit again and is affecting the global economy. Many of the dot coms died years ago and real estate has depreciated in value even in the most affluent cities. Fontana has not been immune, but in a reversal of fortunes, we are in a much better and stronger position now than in the 1990’s.

“Unlike our friends at the state, when our local economy was booming and we were seeing surplus revenues, we actually set aside some of those surpluses for the inevitable recession that was to follow,” said Mayor Mark Nuaimi at the recent State of the City Address.

“We didn’t grow our recurring expenses of salary and personnel benefits based upon one-time revenue spikes,” Nuaimi added.

“Our undesignated fund balance – which we will not touch – sits at 15% of recurring expense.  Plus we have an economic uncertainty reserve that is a little over $7 million which we will tap into in the coming fiscal year,” said Nuaimi.

In an effort to be as forthcoming as possible, the City Manager invited all city staff to meet at the Steelworkers’ Auditorium during their lunch hours in late January and again in February. During these meetings, he gave the most straightforward plans of action from the Council and staff to address the structural deficit anticipated in the upcoming budget year.