Local News in Brief : Costa Mesa : City Facing Deficit After Topping Gann Limit

After becoming the first county city to exceed its Gann spending limit, Costa Mesa faces large deficits and even larger sales tax surpluses that it will be barred from spending before 1993, the city's finance director said Wednesday.

Because of the constitutional spending limit passed by California voters in 1979, the city expects to run an $11.2-million deficit in 1991-93, even as it piles up a $33.1-million surplus, Robert A. Oman said.

But the Gann limit, which determines how much money Costa Mesa can spend, based on the city's population and the rate of inflation, won't allow the city to use the surplus to pay off the deficit, Oman said.

Instead, a surplus must be either returned to the taxpayers through credits or the city must ask voters' permission to spend the extra money, said Oman, who presented his findings this week at a City Council study session.

Options to raise more money included using cash reserves, making budget cuts and boosting fees for city services such as paramedic calls and parks and recreation programs, Oman said.

"We do charge now for practically all of our recreation programs, but the fees are not high enough to cover costs," he said.

The city first exceeded the Gann limit in 1986. In 1987, Costa Mesa voters approved Measure C, allowing the city to spend surplus money from the two previous budget years and into 1990 on street and sidewalk repairs.

Oman said he suggested that the council place a similar measure on the ballot in November, 1989.

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