HUNTINGTON BEACH : $96-Million Budget OKd but Cut Feared

By a 5-2 vote, the City Council on Monday night passed a $96-million budget for the new fiscal year beginning July 1, but city officials said the spending plan could change, depending on the Legislature’s actions this summer.

Even though the city painfully managed to cover its own revenue shortfall of $4.3 million and build a small surplus into its budget, officials worry that the Legislature may soon cut or eliminate funding sources for all California cities in a bid to close an $11-billion gap in the state budget.

If the Legislature makes significant cuts to cities, Huntington Beach’s new budget would come undone, officials said.

“The state’s current goal is to take $1.2 billion from local governments,” City Administrator Michael T. Uberuaga told the council Monday. He noted that if the Legislature exercises one option--keeping cities’ share of the vehicle-licensing fees--Huntington Beach would lose up to $6.3 million next year.

Even before proposals were raised at the state level to keep vehicle licensing fees and property-tax revenue, Huntington Beach had increased city fees and cut back on city services to balance its budget for the coming year. Councilman Don MacAllister and Mayor Jim Silva voted against the budget Monday night, both saying they opposed the fee increases.

Several residents at the meeting criticized the council for signing a three-year contract in 1990 with unions representing city employees. That contract calls for a series of yearly pay raises, including a 6% increase for the coming fiscal year. Several residents accused the city of being extravagant by granting raises during economic bad times.