Residents to Debate Tax Rebate Proposal : Finance: A Mission Viejo town hall meeting is set Feb. 12 to discuss the plan to return millions to residents from city coffers.

Residents will get a chance next month at a town hall meeting to debate the city’s much ballyhooed multimillion-dollar tax-rebate proposal.

The extraordinary public session, which will be held Feb. 12, was approved unanimously by the City Council on Monday night.

Although some council members expressed apprehension over refunding to property owners portions of the city’s $21-million surplus, the council agreed to go ahead with the session, which will provide a forum for public discussion of the plan.

“I really don’t know if rebates will be good for the city,” said Mayor Sharon Cody. But she said she is “satisfied that the staff will have enough information by Feb. 12 so that people can have informed choices.”

In the past month, council members and top city officials have argued over the amount and feasibility of any rebate, as well as who should get credit for the idea. In addition, it has remained unclear whether a majority of residents favor the idea.

When the refunds first were proposed Dec. 24, all five council members supported handing them out. But more recently, three council members have preached restraint, asserting in interviews that assiduous financial studies should be completed before the city doles out any its surplus.

That same disagreement was reflected in the discussion Monday night among council members, as well as among residents who attended the session.

“The time may come in the not too distant future when this city may no longer meet its future needs,” said Councilman Robert D. Breton. “I don’t think I would be doing my job as caretaker of city funds if I would forfeit the future for those who cry out (for refund checks) at this time.”

But Councilman Robert A. Curtis, who has been criticized for using the rebates to promote a possible run for the 71st Assembly District seat, said the town hall meeting must be held soon. Curtis, who favors putting the rebate issue to a citywide referendum, said the council must decide by March 6 in order to qualify such a question for the June ballot.

The original proposal, which raised eyebrows among city budget officials, would have taken $10 million from Mission Viejo budget reserves for distribution to taxpayers in the city. Under the plan, proposed by Councilman William S. Craycraft, each property owner would have been eligible for a $500 refund.

But at a raucous press conference called by Craycraft on Christmas Eve, the rest of the council denounced his proposal as poorly conceived and excessive.

City officials say only $5 million of the $21 million surplus is not already set aside for a program or capital improvements project.

About 20 people were at the meeting Monday to support the rebates. Some said they belong to the Citizens Alert Committee, a recently formed group that last weekend distributed flyers citywide to demand a tax refund.

Dave Nolan, a Mission Viejo resident, told the council he supports giving unused tax revenues back to city property owners.

“We need a tax rebate,” he said. “We need as much of it returned to as many people as possible.”

Also in attendance at the session was a handful of opponents of the plan. One of them, Rebecca Hutchison, told the council: “Mission Viejo has many needs which must be explored before a decision is made. I see many things that must be fixed in Mission Viejo.”