Recession Crueler to Aging Cities of North County

Rosy-cheeked optimism isn’t abundant in North County these days. The rambling region that was once the promising New World for refugees of crowded, expensive Los Angeles is now aging and needy.

The recession has cast a dark glance all over the county, but in the north it has struck with a closed fist. South County communities have had to pare back, but they still are sprouting new office buildings and freeways, while northern towns struggle for economic survival.

In a nearly unanimous chorus, North County mayors say they haven’t the luxury to dream of major new projects for their residents. They are fighting just to keep their police and fire departments intact.

“Staying alive is our top priority,” Fullerton Mayor Don Bankhead said. “We’re going to try to maintain the level of existing services, but there’s a chance we’re going to have to cut somewhere.”

Placentia is thinking of reducing its park maintenance and eliminating the free trolley that runs around downtown. Anaheim does not fix its potholes anymore and has closed its branch libraries on Mondays. Most cities have instituted hiring freezes, if not layoffs.

Communities across California are reeling from multiple fiscal woes. Still stinging from the drop in property taxes sparked by Proposition 13 in 1978, cities are now watching their sales tax revenue dwindle as recession-wary consumers spend less.

The state and federal governments, searching for ways to ease their own economic misery, have added to local troubles by passing more and more fees down to the cities.

And so it is that cities are beleaguered as 1992 dawns. How well they survive will depend on how well they can hunt down the all-important prey: new sources of revenue. And this is what troubles the North County.

More needs and fewer options. That’s much of the problem when it comes to generating revenue in the north, said Mark Baldassare, a UC Irvine professor of social ecology who studies Orange County. These older cities need physical repair; their streets and sewers are aging. Yet they cannot anticipate the income from growth--commercial and residential construction--that South County cities can, he said.

Unfortunately, demographic shifts have hurt the north. The population of the south is growing faster and it is also drawing wealthier residents, Baldassare said. The tax implications of that trend connect like a line of dominoes: The south has mounting spending power, which attracts business, which in turn generates sales tax revenue and encourages more development.

Newer towns, such as those in the south, can “fiscalize” their land-use, making sure that new developments include enough businesses that generate sales tax revenue, Baldassare said. Older cities, such as those in the north, have little or no undeveloped land, so they must revitalize existing areas in a bid to lure business, he said.

Yet, despite these disadvantages, a few North County cities are in surprisingly good financial shape, with sales tax revenue humming along. Brea Mayor Ron Isles said income from the Brea Mall, even in these slow shopping times, has helped his city shed any worry about cuts in Police or Fire Department personnel. In Yorba Linda, a huge new grocery store and two auto dealerships are doing well, said Mayor Irwin M. Fried.

But in most cities, it’s a struggle. Around the polished tabletops of city halls, the talk is about business: how to keep what they’ve got and attract more.

In Fullerton, Bankhead is hoping that modernizing the historic train depot will help draw businesses and shoppers downtown. La Habra’s Fashion Square shopping center, anchored by the ailing Bullock’s, is being revamped with high-volume operations such as Ross Dress-For-Less and Drug Emporium.

Los Alamitos is considering its first redevelopment plan to bring new business to the city. Placentia is distributing books full of coupons to encourage residents to patronize local stores.

In the contest to woo business, older cities with little open land must compete with newer towns that have a powerful come-on: offers of free land. Such temptations lure companies away, often to Riverside or San Bernardino counties.

“How can I compete with that?” asks Anaheim Mayor Fred Hunter. “What can I offer?”

Since Anaheim owns its own utilities, it had an unusual weapon in its arsenal: Hunter and other city officials hit the sidewalks, offering reduced utility rates to businesses to stay within city limits.

These sorts of solutions surface in towns such as Anaheim, where sales tax revenue has been the lifeblood. As revenue from tourist attractions such as Disneyland dwindles, other monies must be found if city officials are to avoid angering residents with a tax hike.

Buena Park Mayor Rhonda J. McCune said her city has increased developer fees and utility taxes, and now faces “mounting pressure” for an entertainment tax on such moneymakers as Knott’s Berry Farm and Movieland Wax Museum. But she’s afraid such a move would be “biting the hand that feeds.”

“When I was mayor in 1988, it was so different,” McCune said. “The focus was development. Now we’re just hoping to maintain the services and employees we have. But something has to give somewhere.”

Drawing business--especially manufacturing--is the first important step toward economic vitality, Baldassare said. If successful, it can spiral into more success, he said.

“There is the potential for revitalizing the economy in the north,” he said. “If towns can draw manufacturing, there’s a huge labor pool (to put to work). Then you have rising income, with people working, which means you have more spending money.”

And more spending money attracts more business, which in turn brings development, both of which bolster cities’ revenue.