Pomona Warned of $3.8-Million Deficit : Finances: Taxes must rise or spending be cut, the city administrator says, to stay afloat and provide enough police.

The city will have a $3.8-million deficit next fiscal year unless it reduces spending or raises taxes, City Administrator Julio Fuentes warned the City Council this week as haggling began over a projected 1991-92 budget of $55 million.

Fuentes said the city is confronted with declining sales tax revenue because of the recession and the loss of two auto dealerships, and it will also take in less money because of planned cuts in the city’s utility tax.

In addition, he said, property tax revenue will be lower than expected this year because a new state law allows the county to charge Pomona $388,000 for collecting the tax.

And to add to the city’s financial difficulties, Fuentes said in a budget report submitted to the council Tuesday, the Police Department needs more money.

The report said Pomona would have to add 62 police officers to its current total of 170 to reduce its response time. The average response time is 28 minutes. With 62 extra officers, the report said, it would be reduced to 13 minutes.

The report did not address the question of the specific cost of hiring extra officers.

The city ended the previous fiscal year with a surplus of more than $1.1 million, and it should finish the current fiscal year in June with a balance of $262,000, Fuentes said. But the projected deficit of $3.8 million in 1991-92 will increase to $5.5 million the next year unless steps are taken now to avert the shortfall.

Part of the deficit comes from a planned reduction in the city tax on utility bills for gas, water, electricity and telephone service. The City Council embarked on a plan last year to gradually reduce the tax, which now amounts to 8% to 10% of the utility bills, to 5%

Councilman Mark A. T. Nymeyer, who proposed the utility tax cuts, said one way to solve the city’s revenue problems might be to suspend further reductions until the city begins drawing revenue from several projects that are now envisioned, including a proposed regional shopping mall.

But Councilman Tomas Ursua said the city should continue to reduce the utility tax as scheduled. He said the financial figures submitted by the city staff amount to scare tactics, and he noted that the city was reported to be financially strapped a year ago too but still found $2 million for employee salary increases.

“We’ve got to start living within our means,” Ursua said.

In receiving the financial report this week, the council offered no public comment on the recommendation from Fuentes that it invest more money in police services.

But Mayor Donna Smith said after the meeting that she supports an increase in the police force. “If we’re going to make this a safe city,” she said, “we’re going to have to put more officers on the street.”

Ursua, who is running against Smith for mayor in the March 5 city election, said he doubts that adding more officers would make the city safer. The city should use its existing police force more efficiently, he said, and find other ways to address underlying causes of crime such as joblessness.

The City Council has appointed a 25-member committee to study ways of increasing city revenue. In addition, the council voted this week to solicit bids from consultants who could help Pomona find new revenue sources.