LAGUNA BEACH : Potential Taxes Hit Residents’ Stonewall

A vocal group of residents turned out this week to oppose a list of possible tax increases being considered by the City Council.

Many of the two dozen residents who took turns in the speaker’s box during Tuesday night’s council meeting were festival or theater representatives vehemently opposed to a suggested 50-cent admission tax on movies, plays and festivals.

Others vowed to fight any new taxes and demanded the city lay off employees and cut municipal workers’ salaries instead. Some merchants said that they and other business owners have already dismissed workers to make their operations leaner and that the city should do the same.

“That’s just a fact of the recession,” merchant Belinda Blacketer said. “I ask that you look at cutting salaries in City Hall.”

Festival representatives said it would be wrong to levy an admission tax on nonprofit events that help keep city businesses afloat and generate needed sales tax revenues for Laguna Beach.

“We feel that we are doing more than our part towards making a major financial contribution to the city of Laguna Beach,” Sawdust Festival spokesman Martin Roberts said. “We strongly recommend against any effort that might adversely bite the hands that are doing a pretty darn good job of feeding our community.”

Tuesday night’s public hearing was one of three held so far leading to adoption of the 1993-94 budget. The council took no action, simply using the opportunity to test public sentiment about how to balance the city’s budget.

Since anticipated cutbacks in state funding will reduce the city’s discretionary income by about $2.5 million per year, city officials say they must consider tax hikes, reductions in city services and almost certain layoffs of municipal employees.

In addition to the admissions tax, the council is also considering a 5% utility tax and a special assessment to pay for maintenance of parks, beaches and street medians.

As a long-term measure to help feed city coffers, the council is also considering whether to call a special election to propose a $100-per-home tax to help pay for police, fire and paramedic services. That option would require a two-thirds approval from the voters.

As another option, the city could help pay for such basic city services by dipping into a fund now set aside to buy open space and to build a new parking structure near City Hall.

But Johanna Felder, president of the city’s political action committee Village Laguna, told the council that it would be risky to use that money. “If there isn’t any money for open space, that open space could get developed,” she said.

The council will continue to consider its options as budget discussions continue into June. While some council members suggested that they will heed the recommendations offered Tuesday night, others said there are no simple solutions to the city’s financial woes.

“It’s going to be much more complex than cutting salaries and cutting spending,” Councilwoman Ann Christoph said.

The proposed budget is to be made public by May 1. A final vote on the budget is expected June 15.