"We will probably discuss the loss of the vehicle license fees in the mid-year budget report, as well as the property taxes," said City Manager John Pietig.
Property taxes account for 56% of the city's general fund, which includes expenditures for emergency services such as police, fire and life guard services.
The state action, though less of a blow, still offends city officials.
"We are disappointed that after the passage of propositions to protect local government funding, the state still came after local government funds to balance its budget," Pietig said.
But the city has some unallocated funds from savings in the last fiscal year, he said.
"It could have been worse. The state could have gone after other funding programs," Pietig said.
The loss of $89,000 pales in comparison to the years when the state siphoned $700,000 from the city's revenue.
State raids on local government funding led to action by cities and counties to prevent what former City Manager Ken Frank described in terms generally used in criminal court cases or war. Some of his more tempered words included "abrogation" "incursion" and "usurped."
Frank was a leading supporter of Proposition 1A. The proposition he advised the council on for the 2006-07 budget prevented the state from purloining resources from cities, counties and special districts to support the state's profligate spending habit.
The city's budget is required by law to be balanced and approved by July 1 of each fiscal year. Pietig reported in the 2011-12 budget that the city is in a better financial position than most California cities.