Hawthorne OKs Budget After Delay of 7 Months

Seven months into the fiscal year, Hawthorne officials have finally adopted a budget for 1990-91.

City officials were able to balance the budget at $45.6 million thanks to the repayment of $2 million the city advanced to its Redevelopment Agency during the past two years. The agency used the money for salaries and other expenses.

Revenues in the current fiscal year rose about 2% from last year’s budget of $44.6 million, and expenditure increases are being held to 1%, City Manager James Mitsch said. No department--including the Police Department--added employees, and all city workers were denied raises, he said.

“I think it’s a lean and mean budget,” Mitsch said. “I’d describe it as a product of hard times.”

City officials said the seven-month delay in finishing the budget was due to uncertainties in revenue, including assessing the recession’s impact on sales tax revenue, as well as changes in state funding sources.

Although the city’s general operating budget carried a deficit of $1 million at the beginning of the fiscal year, city officials in the past seven months reduced expenditures and transferred enough money from other funds to create a positive balance of $54,742 in unrestricted funds by the end of this fiscal year, said Finance Director Tim Brown.

The budget projects a total surplus of $1.8 million, but nearly all of that is in restricted budget funds, such as those for street lighting, insurance reserves, state gas tax, water operations, refuse collection and the airport. That means surplus money in these funds can only be spent for those purposes.

Cutting into the city’s available revenues this year were several newly imposed county- and state-mandated programs, Mitsch said. For instance, Hawthorne is now forced to collect its own property taxes, expected to cost about $100,000, he said. The county had previously collected taxes.

The budget package sets aside $10.6 million for police services, $5.7 million for trash pickup, $5.6 million for fire services, $2.7 million for parks and recreation, $2.7 million for water services and $1.1 million to operate the municipal airport.

At a public hearing Monday night, the council voted to restore some funding to the Hawthorne Chamber of Commerce, which had been cut out of the preliminary budget. The chamber, which received $20,000 in the previous fiscal year, will receive $15,000 this year. The council also agreed to spend $5,000 on a juvenile diversion program run by the Police Department.

City administrators “have done a yeoman’s job in bringing expenditures down while maintaining the current level of services,” Brown said.

Sales tax revenue, which is the largest source of revenue for the city’s general fund, is expected to generate $6.6 million, down about $200,000 from the year before. The drop in sales tax revenue reflects a general downturn in the economy and a high vacancy rate in the city’s commercial sector, Mitsch said. But he said he is confident that “once the economy picks up, we’re going to see the revenue sources pick up too.”

Uncertainty about the fate of Proposition D--a proposed property tax measure on the November ballot that would have raised $2.4 million for added police--also delayed the city’s ability to complete a finished budget. The measure failed.

To cope with a 10% rise in serious crime in 1990, police officials last month put all patrol officers on a schedule in which they work 12-hour days three days a week. The so-called Twelve Plan puts more uniformed patrol officers on the streets during every shift and “will be more effective in combatting the crime problem in this city,” Police Chief Stephen R. Port said.

A 10-member Citizen’s Advisory Committee formed by the council three months ago is also studying the makeup of every city department in an attempt to come up with alternative funding methods for police and fire services. The report is due in June.