ORANGE COUNTY PERSPECTIVE : Overdose of the Christmas Spirit

Perhaps the holiday spirit got the better of some of Mission Viejo’s political leaders. Christmas Eve found them jockeying at a press conference to assume the mantle of Santa Claus--the first to dispense holiday goodies to taxpayers.

The session Tuesday was called by City Councilman William S. Craycraft, and sparks flew as he and fellow council members sparred over how best to return surplus tax revenue. Craycraft suggested giving as much as $500 per property owner as part of a $10-million rebate plan. Mayor Robert A. Curtis, who says he is strongly considering a run in a proposed 71st Assembly District, accused Craycraft of being in collusion with 67th District Assemblyman Mickey Conroy (R-Santa Ana), who showed up--and who likely will be an Assembly race foe of Curtis’.

This mixing of politics and municipal finance took place against the backdrop of a budgetary situation unique among Orange County municipalities. While many cities are cutting positions and services, Mission Viejo, incorporated in 1987, has avoided layoffs. It also has a budget surplus of about $21 million. That results from very low overhead as a new city and from advantageous state funding formulas that deliver extra money to new cities in their early years. Mission Viejo gets a tax revenue break from the state of about $2 million annually.

But though the city is flush with cash now, that tax break from the state will run out soon. William Hodge, executive director of the Orange County chapter of the League of California Cities, notes that new cities need to be prudent during a predictable transition period. They start being subsidized by the state and having low demands put on them for services. Eventually, they have to provide and pay for services themselves.

Mission Viejo, which now rents a city hall and gets police protection from the Sheriff’s Department, will face new demands on its taxpayers in the future.

City Manager Fred Sorsabal, while acknowledging that the city enjoys a large surplus, has warned wisely against issuing tax rebates without careful study.

That’s a sound strategy, and the city fathers ought to pay attention. Nor should they be setting fiscal policy at a shouting match between local politicians.

Mission Viejo must realize that this year 138 California cities eliminated a total of 3,200 jobs and that 70% of them had to raise taxes, according to the California League of Cities.

While it’s tempting over the holidays for politicians to want to put cash in the pockets of residents, prudence suggests that the city take a good long look at its present and likely future obligations before committing itself irreversibly to a tax rebate plan, however attractive it may seem.