CITY BUDGETS : A SPECIAL REPORT : A Balancing Act Between Less Money, Rising Costs

The Irvine City Council is considering new and increased fees, with concerts at Irvine Meadows and boxing at the Irvine Marriott among the targets for the levies. In Huntington Beach, some parking rates are going up. It’s the same story all over Orange County.

With few exceptions, cities wrestling with 1987-88 budgets that refuse to balance are being forced by reductions in anticipated sales and property tax revenues to hike fees and tap reserves--a sign that the county’s economy is slowing down.

Most of the county’s 26 cities still are expecting to take in more taxes in the 1987-88 fiscal year than in the current year--4% to 8% more, in most cases. But city officials say that that rate of growth is only about half of the previous year’s and is not enough to cover rapidly escalating expenses.

There are a few bright spots. Santa Ana, for example, has managed to find enough money to launch a new program to spruce up neighborhoods.

But, faced with a state law requiring balanced budgets, most city councils are struggling to maintain services at current levels.

Garden Grove Assistant City Manager Mike Fenderson summed up the situation described by many of his counterparts in other cities when he said: “We see the economy weakening . . . I see where serious problems will have to be addressed in the future.”

Here is a city-by-city look, in alphabetical order, at how the budget-balancing is going at city halls across the county.

Anaheim Spending Plan Contains Potential for Controversy

The city’s proposed $428.6-million budget has a $3.6-million deficit written into it, along with the potential for City Council controversy.

Mayor Ben Bay campaigned for closer budget scrutiny when he ran for the city’s top elected post last November. Likewise, two council newcomers--Fred Hunter, elected last fall, and William D. Ehrle, elected June 2--said in their campaigns that they were dissatisfied with the city’s fiscal policies.

The proposed budget represents a $21.7-million or 5.3% increase over the current year’s spending plan. Of that increase, however, $10.7 million is in the city’s public utility and $8.3 million is to be spent from the 1986 storm drain bond issue. The remainder represents a 1.5% increase.

The budget calls for some cutbacks in street maintenance, sidewalk repair and building maintenance. Even with those trims, a $3.6-million deficit is projected, according to City Manager William O. Talley, because two major sources of funds for the city--the sales tax and hotel bed tax--are expected to lag. Talley has proposed using city budget reserves to make up the deficit.

Ron Rothschild, manager of programs, development and audit for Anaheim, said the city is expecting only a 4% increase in sales tax revenue over the next fiscal year, compared to growth rates of 7% or 8% in recent years. For the current year, the city expects to receive about $30.5 million in sales tax, he added.

In addition to the proposed budget, Talley has presented the council with a massive program for improved public safety, the largest part of which is a five-year, $33.5-million plan to beef up the Police Department.

A plan to refurbish the 20-year-old Convention Center has also been proposed, to be funded solely through a 2% hike in the current 8% bed tax.

Mayor Bay said he is unhappy with the proposed budget, which he thinks will get “meat-axed.”

“In my opinion, the council hasn’t really been presented a budget, it’s been presented a collection of problems accrued over seven years, and now they’ve come to a head. I foresee major changes . . . I don’t consider it a budget. I consider it a collection of problems and wishes with no solutions,” Bay declared.

The council will discuss the budget proposals Tuesday and give city management an indication of its desired changes. It will vote on the spending plan June 30. But that vote may not be the final word, according to the mayor. The city charter requires only that a budget be adopted by June 30, Bay said, adding: “There are no restrictions on changing the budget afterwards.”

Contributing to this story were Times staff writers Marcida Dodson, La Mont Jones Jr., Lanie Jones, Ray Perez, Mark I. Pinsky, David Reyes, Bob Schwartz, Nancy Wride and Jonathan Weisman.