GARDEN GROVE : City Faces $6-Million Deficit in Budget

Several years of passing balanced budgets without solving long-term financial problems has finally caught up with the city, which now faces an estimated $6-million deficit as fiscal planners begin to consider next year’s budget.

“Over the years, we have sort of robbed Peter to pay Paul,” said Mayor W.E. (Walt) Donovan. “It will be interesting to see how we solve this. We are either going to have to do a lot of cuts in services and people or find a way to raise some revenue.”

City officials blame the budget problems on a drop in projected sales tax revenue of more than $1 million, a bad economy and costly new state mandates, such as jail booking fees and air quality requirements.

“We may have been able to handle any one of those three things happening, but to have them all occur during the same year has really hurt,” Deputy City Manager Michael D. Fenderson said.

Donovan said he favors creating assessment districts or imposing a utility users tax to balance the city’s $46-million budget.

“I think everyone has a little bit of a different idea of how to deal with the problem,” Donovan said. “There’s always political considerations, campaign promises and philosophies that come into play. I think we are either going to have to go to a vote of the people or take the bull by the horns and go for a tax increase.”

Councilman Robert F. Dinsen said he would rather see cuts in the budget instead of new taxes.

“The citizens have to be taken into consideration, and it’s just not right to put more of a burden on them,” Dinsen said. “I don’t think this budget situation isn’t anything that we can’t work out. I think there will be cuts, but not major ones.”

Next week, the City Council will be examining its options during a special budget study session. The meeting will begin at 6:30 p.m. on Monday in the Founders Room of the Garden Grove Community Meeting Center at 11300 Stanford Ave.