HUNTINGTON BEACH : Panel Offers Ways to Balance Budget

The chairman of a citizen panel reviewing the city budget said this week that the city has made some fundamental fiscal errors in the past, but lauded City Administrator Michael T. Uberuaga for his efforts to correct those financial problems.

The city’s financial practices that have helped cause a projected $5-million deficit next year “are all curable problems,” said Phillip Inglee, chairman of the Budget Review Task Force.

Further, “the city now appears to be moving in the right direction,” thanks largely to Uberuaga’s fiscal leadership, Inglee said.

Inglee made his statements at Tuesday’s City Council meeting during a presentation in which he contrasted the task force’s budget recommendations with those made by Uberuaga.

The City Council has scheduled a special public hearing Monday so residents can give their views on two proposals.

The 11-member panel, made up of bankers, accountants and other residents with financial backgrounds, emphasized deeper budget cuts and less severe user-fee increases than the package Uberuaga has proposed.

The task force recommends that the council increase fees by $1.2 million and cut $4.7 million in spending. The spending cuts call for either 2% pay reductions for all city employees or 19 layoffs.

Uberuaga’s plan would balance the budget without forcing any pay cuts or layoffs. It would cut spending by $2.7 million while raising fees by $2.6 million.

Inglee called Uberuaga’s proposal “a very well-done, sophisticated plan,” but said the panel believes that the city “should make government more efficient and hold back costs (to residents) for city services.”

“We don’t pretend to be experts of city government,” Inglee said, “but we have a good feeling for what the needs of the community are. And from what we’re hearing, the community wants to avoid (increased) fees that appear to be tax-like increases in the city plan.”

He also criticized the city plan for proposing to use an expected onetime windfall of $6.5 million for such capital projects as the pier reconstruction and beach improvements. The task force suggests that the refund expected from the Public Employees Retirement System should be spent on new streets, lighting, storm drains and other public improvements.

The deficit has been caused, in part, by the recession, but has been worsened by what Inglee called “a lack of financial discipline” by the city in the past. The city during the 1960s and 1970s enjoyed a steady fiscal surplus from real estate development and oil proceeds.

“That attitude now needs to be updated to the economic realities of the 1990s,” Inglee said.