Fiscal Incentive With a Twist: No Budget, No Pay

It’s become an annual ritual for Carson: Several weeks into the fiscal year, the City Council has yet to adopt a budget.

In the past two years, the council delayed passing a budget for at least four months. But this year, fiscal responsibility may come earlier.

That’s because beginning tomorrow council members will have their paychecks withheld unless a balanced budget is passed. The ordinance was adopted last November, just after the council approved the 1990-91 budget almost five months into the fiscal year.

A $29.2-million spending plan, which was put together by City Administrator Larry Olson and Finance Director Lorraine Oten, is before the council, but it has drawn criticism. A workshop will be held at 5:30 p.m. Monday at City Hall on the latest proposal, the council’s last opportunity to meet the self-imposed deadline.

City Atty. Glenn R. Watson said Friday that if the council fails to pass a budget Monday, the withholding penalty becomes effective immediately. Watson pointed out that council members could pass a budget after the Monday deadline, but within the city’s biweekly pay period, and still receive their paychecks on time. Council members get paid $9,792 a year, or $816 a month.

Councilwoman Vera Robles DeWitt, who authored the November ordinance, said the deadline “is in the back of everyone’s minds. But we need to have a budget and everyone recognizes that.”

Reaching an agreement may not be easy. The differences among council members are numerous, and there are few areas of consensus.

Among the stumbling blocks is a proposed 25% reduction in city fine arts contracts, which include funding for the Carson Symphony and the Young Life Singers. The current proposal would allocate $208,000 for fine arts programs.

Another disputed area covers what to do with programs that the city has subsidized in previous years. Kids Club and Tiny Tots, two child-care programs, and the sports complex at Veterans Park are among several subsidized programs that have begun making the transition toward self-sufficiency. Several council members say the programs will never be able to cover their costs. No one has suggested cutting the child-care programs, one of which was reinstated last week after an eight-month hiatus, but the operation of the sports complex could be contracted out.

Council members also cannot agree on whether taxes will be needed and whether workers should be laid off. And there is even an active debate about what it means to have a “balanced budget.”

“My interpretation is that we only spend what we’re bringing in,” DeWitt said Friday, adding that the council has played a “shell game” in the past by using reserve funds to balance the budget.

That’s not the view of Councilwoman Juanita McDonald, who said many cities use their reserve fund accounts to make up budget shortfalls. “Why shouldn’t we pull from whatever means we have available to balance the budget while we’re looking at alternative means of generating revenue?” she asked.

The latest spending plan would use about $1.2-million from a reserve fund earmarked for street and transportation improvements. It comes from state gas tax revenue.

Carson has used reserve funds to balance its budget in each of the past five years. Last year’s budget was adopted in November, almost five months into the fiscal year. Two years ago, the city did not pass a budget until January, more than six months into the fiscal year.