Getting Ready to Fly Again : Hawthorne, which spawned Barbie and the Beach Boys, may be mired in debt, but the determined city is pulling itself out of the crisis with tax hikes and service cuts. It may yet become ‘The Hub of the South Bay.’

There is no more coffee at Hawthorne City Hall. City employees are cutting Post-it notes in half to double supplies. And homeowners just started paying $13 a year to have their streets cleaned.

Hawthorne, the City of Good Neighbors, has gone bust. But true to its motto, this working-class town in the shadow of Los Angeles International Airport has rallied in crisis to make things right.

This is, after all, the eternally optimistic city that spawned the Beach Boys and served as the birthplace of Mattel’s first Barbie.

But optimistic spending practices and a hopeful redevelopment project gone sour were largely to blame for the discovery last year that the city owed creditors more than $10 million it did not have.

In an era when Orange County’s bankruptcy has captured national headlines, Hawthorne might easily have declared itself insolvent to erase its debts. But the people of Hawthorne are determined to pay what they owe.

With a minimum of grumbling from residents, the City Council raised taxes on everything from sewers to telephone services.

“We have to pay the price,” homeowner and civic leader Cora Travers, 70, said simply. “We have to save Hawthorne.”

Many City Hall employees remain cheerful despite cuts in supplies and janitorial services. Deputy City Clerk Candace Sullivan admits with a laugh that she now washes her own office windows.

Local business owners have adopted the spirit. Sears Lumber, which had sold the city $737 worth of lumber and sandbags during last year’s rains, forgave the debt in February when told of the city’s financial problems.

“We wanted to help them out, to try to get them out of trouble,” said Vice President Michael Quezambra. “The city has been there for us, has supported us, and we feel it’s our responsibility, as a business in this town, to give a little back.”

Such gestures, along with the tax hikes and service cuts, have begun to turn the city around. In the last year, Hawthorne has reduced its accounts payable to about $5.5 million, and the City Council recently approved a balanced budget with a small reserve.

Not that everyone is happy with the city’s way of pulling itself out of debt.

At a recent meeting of the Holly Glen Homeowners Assn., more than 100 residents of the tree-lined community, the city’s most affluent neighborhood, said they wanted to cut their ties with Hawthorne and align themselves with El Segundo.

“The homeowners are just disgusted in general with the way the city is being run and want to see what else is out there,” said the group’s president, Mark Schoenfeld.

But the city has seen unhappy days before--and survived them--since its beginnings as a dusty railroad stop between Los Angeles and Redondo Beach harbor.

With the encouragement of local real estate agents who hailed the tiny community as “Ideal for Homes or Investment,” Hawthorne’s windswept hayfields were quickly replaced in the early 1900s by chicken ranches and strawberry fields.

By the time Hawthorne incorporated in 1922, the railroad stop had transformed itself into a thriving city of 2,000 residents who proudly laid claim to their own Fire Department, water company, public school and movie houses.

The community was hit hard by the Great Depression, which forced nearly half of the city’s residents onto general relief. But the local economy revived with the opening of Northrop Aircraft Co. in 1939 and continued to flourish, along with the rest of Southern California, during the Cold War-inspired arms race that landed fat defense contracts in the laps of local aerospace companies.

In the glory days of the 1950s, Hawthorne became an icon of Southern California.

It was home to the Beach Boys’ Brian and Carl Wilson, who paid tribute to their town with anthems such as “Fun, Fun, Fun,” which celebrated their town’s favorite pastime--Friday night cruising.

The fun times have faded over the past several years. Defense industry cuts after the end of the Cold War left thousands of local aerospace employees out of work and put out of business many of the restaurants, gas stations and drugstores that used to serve them.

Real estate prices came crashing downward. Between 1990 and 1993, the median home price dropped 28%, from $226,000 to $162,000. And the city’s most ambitious redevelopment plan--a 22-acre project that would have included townhouses and retail shops--fell through when banks refused to give the developer a construction loan.

The once largely white, blue-collar enclave of small homes gave way in the past 15 years to a multiethnic urban center of mostly apartment buildings filled with young, expanding families.

Increased density has meant higher crime rates, including such stubborn urban ills as gangs and graffiti. But the growing number of young families has also provided the city with a potentially strong base of future consumers.

And there are good reasons to believe that Hawthorne, which has its own airport and is traversed by two freeways and the soon-to-be-opened Green Line light rail system, could yet become what the Chamber of Commerce promotes as the “Hub of the South Bay.”

The city’s proximity to Los Angeles International Airport makes it a prime location for the import-export companies that some boosters are calling the industry of the ‘90s and beyond. The potential construction of a new football stadium in neighboring Inglewood would attract new trade to Hawthorne.

And many city officials believe it won’t be long before developers take advantage of cheap land along the Imperial Corridor that parallels the newly opened and still underused Glenn Anderson, or Century, Freeway.

But perhaps the most tangible sign of the city’s underlying health is the reopening of the Cockatoo Inn, a landmark restaurant and hotel where John F. Kennedy and Robert F. Kennedy allegedly met Marilyn Monroe for romantic trysts.

The English country-style inn, which first opened in 1946 as a chicken-and-ribs restaurant and later won notoriety when its original owner was identified by the U.S. Department of Justice as an organized crime figure, closed last year amid financial troubles.

C.A. Bridge, a Chinese-American partnership, purchased the 213-room hotel and reopened it in January. On a recent weekend, the inn was almost completely full, mostly with Chinese tour groups.

Hawthorne Inside Out City Business Date founded: July 25, 1922 Area in square miles: 5.9 Number of parks: 7 Number of city employees: 310 1994-1995 budget: $27 million *

Latino: 31% Black: 27% Asian: 10% Other: 1% White: 31% *

People Population: 71,349 Households: 27,158 Average household size: 2.61 Median age: 29.5 *

Money and work Median household income: $30,967 Median home value: $194,600 Self-employed: 1,477 Employed workers (16 and older): 37,203 Car- poolers: 5,640 *

Average Yearly Household Expenditures Source: Claritas Inc. Household expenses are averages for 1994. All other figures are for 1990. Percentages have been rounded to the nearest whole number. *

Happy Birthday: The city was named after author Nathaniel Hawthorne, the 19th- Century essayist and novelist, author of “The Scarlet Letter.” So what does a West Coast defense-industry town have in common with fictional adulteress Hester Prynne? The name was chosen by the daughter of the town’s co-founder, who shared a birthday with the writer. Before its time: The Flying Wing, an early precursor of the B-2 Stealth bomber, was designed and built in the 1940s by Northrop Aircraft Co. in Hawthorne. The plane was deemed too unstable by the Air Force and the prototypes were all scrapped. Lights, Camera, Action: Hawthorne Grill, a landmark family restaurant that closed three years ago but was reopened last week, was featured prominently in Quentin Tarantino’s 1994 hit “Pulp Fiction,” as well as in “Cops and Robbersons,” starring Chevy Chase. More Celebrity Ties: Hawthorne was the childhood residence of Mariyn Monroe, who lived with her grandmother on Rhode Island Street, now 134th Street, and attended Washington Elementary School. Freeway Legacy: The Glenn M. Anderson Freeway (1-105), which crosses Hawthorne’ north end, was named after the 12- term U.S. congressman, a Hawthorne native and former mayor, who lobbied for the funds. Anderson, who also served as a state legislator and lieutenant governor of California, first studied the freeway proposal in 1938. He died in December, 1994, a year and two months after the freeway carrying his name and officially opened.