Bradley Proposes $77-Million Tax Hike, Budget Cuts : City Hall: Mayor submits a record $3.9-billion plan that would reduce the size of L.A. Police and Fire departments. He seeks levies on real estate and cable TV.

Facing what he called “one of the worst fiscal crises” in Los Angeles history, Mayor Tom Bradley on Friday submitted a record $3.9-billion budget for fiscal 1991-1992 that slashes $100 million in city spending requests and imposes $77 million in new taxes--the second-highest city tax hike ever.

Bradley said “essential city services will not be interrupted.” The budget calls for a hiring freeze that would reduce the police force by 445 officers and 196 civilian employees and cut the Fire Department by 160 firefighters over the course of the year. Six of the city’s 49 paramedic ambulance teams would be placed on part-time status.

Library hours would be reduced to 32 hours a week from 40. Tree trimming would be stretched to a 15-year cycle from 10 years. The city would eliminate the after-school and weekend recreational programs operated with the Los Angeles Unified School District, which has been the centerpiece of Bradley’s anti-gang strategy.

Virtually no police, fire or sanitation vehicles would be replaced, and no computer systems would be purchased under Bradley’s budget, which faces City Council review.

There will be no layoffs, Bradley said, but 1,400 positions will be eliminated through attrition. A last-minute attempt to persuade city unions to delay a scheduled 5% pay hike July 1 was unsuccessful, said Keith Comrie, city administrative officer. City employees are entering the last year of a three-year contract.

New taxes include a 10% levy on monthly cable television bills and an additional transfer fee on the sale of all real estate.

“The recession which has gripped the nation for the last year has had a devastating effect on city revenue,” Bradley said. “Not since the early 1980s have we experienced budget-balancing problems of the magnitude we face in the fiscal year beginning July 1.”

“I think we can get through this budget year,” he said, “but it won’t be easy for anybody.”

Los Angeles Fire Chief Donald O. Manning said the drain on his department “will be like we’re having two greater-alarm fires at all times.”

The austerity would be evident to just about anyone coming to City Hall: Crews would clean restrooms in city buildings just once a week, instead of twice a week, and trash would be picked up every other day, rather than daily.

City Council members, who have until June 1 to make changes in the budget before sending it back to the mayor for concurrence, were sympathetic to the difficult task Bradley had in developing a budget, but were cool to some of his proposed cuts.

“If we can avoid cuts in cops and paramedics, we will,” said Zev Yaroslavsky, chairman of the council’s Finance and Revenue Committee, which could begin hearings on the budget next week. “Everything is on the table.”

Bradley acknowledged that some cuts were “Draconian,” but he added: “We believe it is necessary to take this drastic action now to avoid more devastating action in the years to come.”

Deeper budget cuts, Bradley said, would have required layoffs and a serious decrease in the level of services that residents demand.

To make up the difference, he proposed a series of new taxes and tax increases including:

Extension of the 10% utility tax to cable television. Estimated annual revenue: $12.7 million.

Increasing the storm water pollution abatement charge by $6 per year. Estimated annual revenue increase: $7.3 million.

Imposition of a new documentary transfer tax on the sale of real property at a rate of $4.50 per $1,000 in sales, or about $900 on the sale of a $200,000 home. Estimated annual revenue: $52.7 million.

“No tax is desirable. No tax is pleasant,” Bradley said. “But we think this is a reasonable approach.”

In a letter to the City Council, Bradley said: “The revenue measures I have proposed will not impose a hardship on anyone.”

The mayor said they are intended to have the opposite effect: “An alternative to the revenue measures (tax increases) would have been to lay off 1,200 city employees. With the unemployment climbing as it is, it did not make sense to me to put anyone out on the street.”

One bright spot for residents on taxes: Bradley overruled his advisers and decided against imposing a trash collection fee at this time. The mayor said he rejected 14 other proposed taxes.

Jack Kyser, chief economist of the Los Angeles Chamber of Commerce, said: “These (taxes) are annoying, but ones we can probably live with it.”

The fiscal crisis was spawned by a soft real estate market and slow retail sales that are projected to produce one of the smallest increases in tax revenues since the 1982 recession, officials said. The city’s general fund will grow by just 2.3% in fiscal 1991-1992 and total city revenues by only 6%, officials said.

At the same time, the city faces inescapable rises in expenses: An across-the-board 5% wage hike for the 33,846 city employees and increased pension benefits will cost an additional $88.8 million--accounting for about half the projected $177-million deficit. In addition, state-mandated improvements at the Lopez Canyon landfill will cost an estimated $26.8 million, and cost hikes in health insurance, workers’ compensation and other services are projected at $42.4 million for the coming year.

The budget does not include the departments overseeing the harbor, the airport and water and power, which as semiautonomous agencies with commissions appointed by the mayor have their own sources of revenue and budgets.

Some members of the City Council say that while unpopular, the cuts may be necessary given the severity of the projected deficit.

“You’ll hear a big uproar, and then they’ll vote for the budget as proposed, just like they always do,” City Councilman Ernani Bernardi said about his colleagues. In a typical year, the council changes less than 3% of the mayor’s proposed budget, city records show.

Still, council members Joy Picus, Bernardi and Yaroslavsky said they will fight to restore cuts in the Police Department, which has more than 10,000 employees, including civilians.

“I will fight any cut in the Police Department,” said Picus, a member of the key Finance and Revenue Committee. “We need more officers, not fewer.”

Bradley said his disagreements with Police Chief Daryl F. Gates had no impact on his decision to cut the department’s spending requests. “The chief said he understood the gravity of the budget and can live with it,” Bradley said.

Comrie said: “Chief Gates and Bradley met, and the chief said he was fully aware of the budget problems and said he would take his full share of budget cuts.” Comrie said Gates chose to have full funding of the department’s $16-million overtime budget rather than filling several hundred vacant positions.

Total sworn positions in the department would drop to 7,972 from 8,417 under Bradley’s budget. Because of increases in wages and other expenses, the total Police Department budget would rise by $10.6 million, to $569 million.

Gates could not be reached for comment.

Yaroslavsky and Bernardi said they would prefer the controversial “admissions” or “entertainment” tax on movies and sporting events to a reduction in officers.

The mayor could have the upper hand in this year’s budget debate. Bradley has veto power over any changes the council makes to his budget. The council can override any veto with 10 votes.

With the council down to 13 members--because of the death of Gilbert W. Lindsay and Gloria Molina’s election to the County Board of Supervisors--Bradley needs just four votes to uphold his vetoes. “He has us by the neck,” Yaroslavsky said.

Picus took a philosophical approach to the budget. Such cuts, she said, “are usually temporary. That’s the one thing that gives me any comfort at all.”

PROPOSED CITY BUDGET

Here are highlights of Mayor Bradley’s 1991-92 budget proposal. Spending figures are compared to those of the previous two years. Last year’s budget was $3.2 billion, this year’s budget is $3.6 billion and the budget proposed for next year totals $3.9 billion.

POLICE DEPARTMENT: Last year: $528 million Current year: $558.7 million Next year: $569.3 million

The department will reduce the number of sworn officers by 445 through attrition and will cut equipment expenditures by $5 million. The budget increase of $10.6 million represents an average salary hike of 5% and a $1.3-million increase in expense accounts.

FIRE DEPARTMENT:

Last year: $227 million Current year: $244 million Next year: $232.6 million

The Fire Department’s proposed decrease of $11.5 million would come from deferring the replacement of 12 emergency fire sedans; reducing staffing levels at 13 of 47 fire stations on a rotating basis; holding off on the painting of fire stations, and reducing six ambulances to half time on a rotating basis throughout the city.

LIBRARY DEPARTMENT:

Last year: $35.1 million Current year: $36.2 million Next year: $36 million

The proposal for reducing library branch hours from 40 to 32 per week and keeping 125 positions vacant would save $206,000.

RECREATION AND PARKS:

Last year: $66 million Current year: $68.1 million Next year: $63.6 million

Almost $4.6 million would be saved by scaling back the number of playgrounds to be refurbished, from 25 sites to seven; reducing material and supply expenses; delaying purchase of tractors, lawn mowers, and other equipment, and keeping 119 vacant positions open.

STREET MAINTENANCE:

Last year: $86.1 million Current year: $86.3 million Next year: $92.6 million

The proposed increase of $6.3 million represents mandatory salary increases of $3 million and price increases of material, such as wood products, sand, gravel and asphalt. Increasing the tree-trimming cycle from 9.7 years to 14.8 years would save about $2.7 million.

Compiled by Times editorial researcher Cecilia Rasmussen.

THE BUDGET DOLLAR

Mayor Tom Bradley on Friday unveiled a record $3.9-billion proposed city budget, saying that Los Angeles faces “one of the worst fiscal crises” in its history. The following chart shows the city’s anticipated revenue sources and expenditures for the 1991-92 fiscal year. WHERE THE MONEY COMES FROM: Water and Power, Airport, Harbor Revenues: 3.7% Utility Users Tax: 11.3% Licenses, Permits, Fees and Fines: 23.5% Business and Hotel Taxes: 9.7% Sales Tax: 7.9% Allocations/Grants from Other Government Agencies: 15.9% Property Taxes: 14.8% Reserve Fund Transfer: 0.2% Miscellaneous: 13% HOW THE MONEY IS USED Community Safety: 34.9%

Police: 22.8 %

Fire: 9.1 %

Other: 3 %

Home and Community Environment: 32.8%

Sewage handling: 19.2 %

Garbage: 4.8 %

Planning and building enforcement: 1.8 %

Clean streets, parkways: 1.2 %

Other: 5.8 %

Transportation: 15.5%

Street and highway transporation: 9.9 %

Traffic Control: 4.0 %

Other: 1.6 % Cultural, Educational and Recreational Services: 4.7% Human Resources, Economic Assistance: 2.1% General Administration and Support: 10% SOURCE: City of Los Angeles