ORANGE : City Advised to Raise Taxes, Cut Budget

The city should consider raising its fees and taxes while cutting the budget for fire and police services by 7%, a financial advisory group recommended Tuesday.

In a report, the group also proposed continuing a 10% pay cut the city’s nonessential employees took last fall. The cut is scheduled to end June 30, but the group wants to keep it until mid-1994.

“The main problem is that city spending exceeds revenues,” said Lynn Doti, a professor of economics at Chapman University and chairwoman of the city’s Ad Hoc Financial Advisory Committee. “Spending reserves is a short-term solution, and you can’t do it forever.”

About 250 city workers who filled the City Council chambers for the report’s presentation cheered loudly when employee union officials challenged parts of the document.

“Is the city prepared to reduce the budget for public safety at the same rate as for parks and recreation?” said John Whiteley, president of the Orange Police Assn.

But Doti said significant savings can’t be achieved without cutting spending for Police and Fire departments, which make up almost 60% of city expenditures.

“Public safety is such a large part of the budget that cuts in other areas won’t make much of a difference,” Doti said.

Whiteley said the advisory committee, which has met since December, shouldn’t have suggested budget cuts after studying city finances for little more than a month.

“I question the fact that they were totally dependent on the city for their figures,” Whiteley said.

But city employees wouldn’t be the only people affected if the council approves the group’s recommendations.

The committee suggested that Orange impose a 2% utility tax on such services as telephone and electricity in the hopes of raising $2.4 million for fiscal year 1993-1994. The city does not now tax utilities.

Further, the group suggested raising from 8% to 10% the transient occupancy tax the city charges travelers.

“It’s like presiding over a funeral. Our constituents don’t want services decreased, especially fire and police, but at the same time they don’t want fees or taxes increased,” Councilman William G. Steiner said.