NEWS ANALYSIS : Similarities of 2 Cities End at Door to City Hall : Government: Malibu and Beverly Hills are light-years apart when it comes to comparing dollars and municipal services.

Malibu and Beverly Hills have a lot in common: Names with international cachet, an abundance of famous and wealthy residents, homes to die for.

But the two cities are separated by more than the Santa Monica Mountains. The 1993-94 budgets approved last week offer jarring contrasts in the size and cost of city governments and services.

Malibu expects to spend $6.9 million this year, while Beverly Hills has a $74.3 million budget--more than 10 1/2 times greater, which far exceeds the difference in population. Malibu expects revenues of about $7.4 million, while Beverly Hills anticipates $74.9 million.

Is this a contrast between a bloated bureaucracy and a nascent city living on the lean and mean side? Or are the two cities a study in municipal evolution, with Beverly Hills the epitome of a well-evolved community and Malibu just beginning its journey? The city budgets offer arguments for both viewpoints.

Beverly Hills has 645 full-time employees. Malibu has eight. Beverly Hills does just about everything in-house--public works, planning, law enforcement, fire protection, even trash pickup. Malibu contracts out for almost everything.

Beverly Hills’ city government is housed in an opulent, $120-million civic center. This fall, Malibu expects to move from rented quarters in an office building to rented quarters in the old Los Angeles County sheriff’s station. From time to time, the City Council appeals for donations of furniture, paint and wallpaper for City Hall.

Beverly Hills spends $9.7 million for general government, including policy and management, finance administration and legal services. Malibu spends $1.3 million. Beverly Hills residents are paying about $9 million a year over 30 years on bonds that financed the Civic Center. Malibu’s only debt consists of a few remaining installments on its fax machine.

On the other hand, the two city budgets offer an argument that residents get what they pay for.

A 2-year-old city, Malibu is mostly rural, relatively undeveloped, has no parks of its own, and offers few city services. Nearly 80 years old, Beverly Hills is a suburban, fully developed city that offers an array of parks and city services. It also is a major commercial center whose daytime population swells to as much as 200,000 with a daily influx of bankers, lawyers, hotel and restaurant workers, retail clerks and shoppers.

Malibu’s beaches and parks are owned and operated by the state or Los Angeles County. The city has a fledgling Parks and Recreation Department with a part-time coordinator hired in April. The city contracts with the Sheriff’s Department for general law and traffic enforcement. Half a dozen patrol units are allocated to the city. The city also contracts with a private firm to handle public works and building services.

Malibu has a county-operated library in the civic center area; a branch library in Point Dume was recently closed because of county budget cuts. The city has no major shopping centers and only one major employer, the research and development arm of Hughes Aircraft Co.

The city’s shorter menu of services is reflected in its low operating costs and smaller tax base. It has allocated $42,000 for recreation services this year, compared to $7.6 million for Beverly Hills. Its bill from the county for law enforcement and fire protection is $3.6 million--nearly half of the total budget. Beverly Hills allocates $28.8 million for police and fire services.

Malibu expects to bring in about $1 million in property taxes, the vast majority from residential property. Beverly Hills, which has hundreds of commercial and office properties in addition to its mansions and apartment buildings, will get $18.8 million in property taxes.

City and Chamber of Commerce officials say Beverly Hills’ retail and business establishment generates about 70% of the city’s income. Major components include 21 auto dealers, four major hotels, luxury stores on Rodeo Drive and corporate headquarters for Hilton Hotels, Playboy Enterprises and Virgin Records America.

Beverly Hills is a full-service city, said Fred Cunningham, the city’s full-time public affairs and information director. Residents demand and get a “pretty high level of service,” he said, but it costs money.

The city has a 500,000-volume library used by more than 70,000 borrowers a year (cost: $3.6 million a year), 12 parks and a park-like ambience created by 32,000 well-cared for trees arching over streets and parkways.

The city has a police force of 128 sworn officers that can respond to a call anywhere in the city within three minutes. The department has an awesome communications system and its own jail.

Not everyone is delighted with what it all costs. Thomas White, president of the Beverly Hills Municipal League, a civic group, agreed that residents demand a high level of service from the city. But, he said, they did not ask for a $120-million civic center or a city government that is “a model of inefficiency.”

An income of nearly $75 million should be enough to run two governments, White said. Yet this year, the city struggled to balance its budget, and residents are being asked to pay for trash collection, which has always been provided by the city.

“We’re not receiving the benefits that money should be buying,” White said. Yet when residents complain about the way money is being spent and the impact of business on noise, traffic, safety and the quality of life, the city uses fear of losing police and a diminution of service to perpetuate its inefficiency, he said.

White said he would like to see an across-the-board management and financial audit with every city position and cost independently justified. The city should use a zero-based budgeting process that starts from zero and justifies each cost added.

Stewards of the city’s money need to have the same level of accountability and commitment that individuals have for their household budgets, he said.

In Malibu, there appears to be little appetite for Beverly Hills’ level of services and amenities--and certainly no desire to pay for that much more government. In fact, residents are still pleased as punch to be rid of county government.

And yet, there is a growing wish list. Assistant City Manager Mark Lorimer said he senses keen interest among residents and City Council members for more parks and recreation services. Because of state and county budget difficulties, the city may be in a position to take over the operation of several parks, he said.

Residents also have said that they would like the city to pay more attention to street maintenance. And businesses are asking the city to clean up debris in some areas along Pacific Coast Highway.

And perhaps when the fax machine is paid off, they might think about a VCR or a photocopier.

Malibu and Beverly Hills by the Numbers

Malibu Beverly Hills Incorporated 1991 1914 Size (square miles) 19.5 5.7 Population (1990) 25,497* 31,971 Average household income $124,454 $121,396

1993-94 budget projections (in millions):

Malibu Beverly Hills City Revenue (millions) $7.4 $74.9 Property tax $1.0 $18.8 Sales tax $1.4 $11.7 Hotel guest tax $0.48 $ 6.8 Business licenses 0 $14.8 Utility users tax $1.3 none Expenses $6.9 $74.3 General Government $1.3 $9.7 Police and Fire $3.6 $28.9 Planning $0.46 $1.0 Building/Safety $0.80 $1.8 Public Works $0.65 $3.3 Recreation/Parks $0.04 $7.6 Library 0* $3.6 Community Support 0 $6.5 Debt Service 0 $8.5 City Employees Full-time 8 645 Part-time/seasonal 3 145 City Parks/Beaches 0** 6 main parks 6 mini-parks

* Malibu was not incorporated at Census time in 1990. This population figure is a state estimate derived from a formula for new cities that usually overstates the true population.

** Malibu’s parks, beaches and library are state or county operated.

Sources: city officials, 1990 Census, Beverly Hills and Malibu 1993-94 General Fund Budget documents.