Beverly Hills : Budget Shortfall Projected

A draft of next year’s budget projects a $3.4-million shortfall. To close the gap, the City Council will look at cuts in city departments and new sources for money.

The proposed budget released Tuesday assumes that the city will discontinue a $2.2-million subsidy of residential garbage collection/street sweeping costs and pass a 65% increase on to consumers.

The Public Works Commission has recommended the utility increase but has continued to have public meetings on the matter. City Manager Mark Scott has said the budget shortfall could rise to $5.6 million if the subsidy is continued. The new fiscal year begins July 1.

The city anticipates general fund revenues of $72.3 million, down from $75.4 million this year. Operating budget expenditures have been proposed for $75.7 million, about the same amount budgeted for 1992-93.

The cause of the shortfall is a dramatic decline in property tax revenue the city expects to receive from the state. The budget projects that $16.2 million in such revenue will be passed on by the state next year, down from $19.4 million this year.

Continuing weakness in the economy means that other sources of revenue, such as hotel bed taxes and fees for licenses and permits, are not expected to pick up significantly to help close the budget gap.

The council will begin the public budget process at an informal meeting at 3 p.m. Tuesday, and again on June 15. The debate could continue on June 22 if needed to meet the June 30 deadline for adopting a budget.