HUNTINGTON BEACH : City Delays Action on Cutting Budget

The City Council this week delayed dealing with a $922,000 anticipated general fund shortfall until later this month or early February.

City Administrator Michael T. Uberuaga requested the postponement due to the uncertain impact the Orange County bankruptcy could have on the 1994-95 budget.

Uberuaga said at the special budget meeting that the county bankruptcy has “thrown a different twist” on balancing the $96-million general fund budget.

“With a 30-day delay, we wanted to get a better idea of the bankruptcy impact,” he said.

Uberuaga said the county bankruptcy could cause further revenue reductions and a larger shortfall.

He said the city could lose between $500,000 and $800,000 in interest payments from the $43.6 million it has frozen in the county’s investment pool. Also at stake is about $2.5 million in property taxes still owed to the city.

Council members suggested that the budget shortfall could be reduced from savings through attrition. Uberuaga said 68 employees retired from the city in the last year.

He said normally between 25 and 30 people retire a year.

Uberuaga is expected to present recommendations to the council on ways to eliminate the budget shortfall. A public hearing is also expected to take place at a later date.

While the council voted unanimously to wait 30 days, some council members expressed a sense of urgency to deal with the deficit.

Councilman Ralph Bauer, who voted against the budget in September, said he disagreed with a delay and was prepared to make cutbacks to balance the budget.

Mayor Victor Leipzig also said that not operating with a balanced budget is an “embarrassment to the City Council.”

The budget deficit was created in part because of the past council’s desire not to cut public safety services, as well as programs and services for senior citizens and youths.