Newport looks at state budget impacts

June Casagrande

All over the state, municipal governments are scrambling to figure

out exactly what the state budget will mean to their local finances.

At the same time, residents are struggling to understand the ways in

which the numbers will hit home.

Newport Beach City Councilman John Heffernan wants to spare this

city’s residents the pain of that uncertainty. Heffernan has asked

city staff to prepare a formal report to be presented in a regular

City Council meeting. The report will examine some of the finer

points of Gov. Arnold Schwarzenegger’s budget, looking at how much

the city stands to lose and analyzing where and how residents could

feel the crunch.

“Throughout the state, everyone’s hearing about things like

cutbacks in police and fire personnel, all kinds of talk about what

the governor’s budget will mean,” Heffernan said. “I’d like to see a

full presentation with the complete numbers so people can know

exactly what we’re looking at.”

Heffernan said he hopes the information can be presented during a

regular council meeting instead of in a study session, because more

people watch the council meetings, he said.

Schwarzenegger’s fiscal 2004-05 budget includes $1.3 billion in

cuts to local governments, but makes good on his promise to reinstate

car tax revenues to cities. Local officials are still examining the

actual numbers of the governor’s budget to figure out how much the

city might lose.

But it’s possible the city won’t lose at all. Newport Beach has

begun receiving car tax receipts from the state, which are

essentially gravy because the city’s spending plan doesn’t count car

taxes as a revenue source -- city fiscal experts thought it better

not to count on getting the money. If the governor’s cutbacks cost

Newport Beach only about $2.5 million, as one rough estimate

suggests, but returns $2.9 million in car taxes, the state cuts might

not hit home at all.

Even if they do, Mayor Tod Ridgeway has predicted that it’s highly

unlikely any police or fire personnel will be laid off.

“I certainly can’t envision any layoffs of safety personnel, but

it’s possible this could mean less hiring in the future,” Ridgeway

said last week.

The date of the budget presentation has not yet been set.