COSTA MESA : City Predicts Slight Increase in Revenue

Despite drops in sales tax revenues hitting other Orange County cities, Costa Mesa predicts slight increases in revenue from sales and property taxes in the 1991-92 fiscal year.

The effects of the recession, which forced the city in April to downgrade its projected sales tax revenue for the current fiscal year, seem to be tapering off, City Manager Allan L. Roeder said in a budget message to the City Council.

Thus, the city will not be forced to cut personnel or services or raise taxes to sustain the current level of government services, according to a summary of the city’s $31.9-million budget presented to the council at its meeting Monday night.

Unlike the cities of Anaheim and Santa Ana, which have proposed adding utility and other taxes to make up for lost revenue, Costa Mesa’s sales tax outlook is relatively optimistic, Roeder said. The projected 1991-92 level of $25.5 million in revenues is up 3.8% from the 1990-91 projected sales tax revenue of $24.6 million.

With the upscale South Coast Plaza within its borders, the city counts on sales tax revenues to make up 39% of total revenues.

Property tax revenues are projected to make up 21% of the city’s revenues, or $13.6 million, a 7% increase over the current fiscal year.

The revenue picture is not as bright for investment earnings, which are projected to drop 18% over the current year.

Also, revenue from state, county and federal agencies is not expected to match the current level. The city expects to see a 15.6% drop over the current year, with $1.5 million less from the federal government, $891,000 less from the county and $209,000 less from the state.

“Since each of these agencies is in the midst of resolving significant budget deficits, each will undoubtedly attempt to once again turn to cities in an effort to solve their budget shortfalls,” according to the Roeder memo. If this trend continues, he noted, current revenues expected from these agencies could be at risk.

For instance, jail booking fees imposed by the county are estimated to cost Costa Mesa $231,000.