HUNTINGTON BEACH : City Budget May Be $7.5 Million Short

Huntington Beach may face up to a $7.5-million budget shortfall because of the continuing recession and state funding cutbacks.

City Administrator Michael T. Uberuaga has told the City Council that the city may need to cut 55 full-time employees and 14 part-time workers if the state takes more funds away from local governments. And some of those laid-off employees would have to be police officers and firefighters, he said. The city has 1,052 full-time employees.

In recent years, state government has cut into tax dollars that once were earmarked for cities, counties and school districts.

Uberuaga said there is a real possibility the state will take away additional tax revenue from the cities this year. If so, he said, the city would have a $7.5-million shortage.

The city administrator said the city’s new budget, for the fiscal year beginning July 1, calls for a hiring freeze. In addition, he said, the $98-million budget proposes new or increased fees for various city services, a “drastic cutback” in maintenance and the possible closure of two library branches.

The city has about $10 million in reserves, but Uberuaga warned against using that money to cover the budget shortfall, pointing out that the reserve is a “one-time” source of income and should only be used in an extreme emergency.

Uberuaga said that until the state adopts its budget, no city knows how much income it can count on. The state, like city governments, is required by law to approve a balanced budget by July 1. In practice, however, the state often misses that deadline and last year waited until September to adopt a new spending document.

Legislative officials, including Assembly Speaker Willie Brown (D-San Francisco), recently pledged to adopt a new state budget well before July 1 this year.