ORANGE : City Warned Deficit Could Triple by July

An update on the city’s fiscal health shows that the budget deficit could triple from the recently ended fiscal year unless officials act now to offset the shortfall.

The city closed the 1990-91 fiscal year in June with a $1.58-million shortfall. By the end of the current fiscal year in July, the deficit could grow to $4.6 million, City Manager Ron Thompson said.

He has asked department heads to squeeze another 5% in cuts from budgets that have already been reduced by 10%. On Tuesday, he presented City Council members with a list of the possible trims, totaling $2.34 million, but no layoff of city workers was recommended.

While Orange is better off financially than many cities in the county, Thompson said, it has been “very much impacted” by the recession, falling sales tax revenue and other fiscal problems.

By asking the city to make more cuts, “we’re positioning ourselves for 1992-93,” Thompson said. “We have to live within our means.”

The council is not expected to act on the reduction proposal until January. But last week, council members approved preliminary reductions that began to chip away at the deficit.

Among the first deficit casualties was a Christmas party for department heads, which would have cost about $4,400. In addition, the council voted to close all branch libraries from Dec. 22 to Dec. 29. Library employees will be encouraged to take unpaid furloughs, which could save the city up to $15,000. Paid leave for employees on Christmas Eve and New Year’s Eve may also be eliminated, for a savings of $75,000.

Thompson has also proposed that city employees volunteer to take one-week, unpaid furloughs during the next few months and has recommended that the city continue its hiring freeze. Twenty-eight positions are now vacant, he said, and filling them would cost the city $928,793.

To ease the staff crunch in certain departments, Thompson has proposed “interdepartmental loans” to provide temporary help where needed. Funding for training, meetings and conferences would also be cut by $90,506.

Council members said they are aware of the burden some of the proposed reductions place on city staff but said they have little alternative.

“I think we have some very tough decisions to make on the work force that are going to be tough to swallow, not only this fiscal year but next fiscal year,” Councilman William G. Steiner said.

Also scheduled to be slashed or eliminated are the budgets for special events such as the May Festival, Winterfest and Fourth of July festivities, to save $76,000. The city may also consider postponing $872,000 in renovations at City Hall.

“We have a good city, and it’s going to come through all right,” Ted Schoettger, city financial director, said. “We just have to make some hard decisions.”