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Long Beach : Tight 1987-88 Budget Predicted

March 26, 1987

City Manager James C. Hankla warned the Long Beach City Council on Tuesday that it is facing its tightest budget in a decade. Hankla, who is preparing the 1987-88 budget for submission to the council May 12, said it cannot be balanced without a $30-million infusion of new revenue, a reduction of city services, a delay in construction projects--or a combination of all three.

Hankla said his analysis also indicates that the city will have a $3-million surplus this fiscal year ending June 30, rather than nearly $9 million projected by former manager John Dever in January.

Dever said the city was facing its biggest fiscal crisis since the passage of tax-slashing Proposition 13 in 1978, and Hankla said that "from my review, I believe that to be an optimistic forecast."

A big loss will be $6.7 million in federal revenue sharing. In addition, oil revenues have not increased as had been hoped and city income on investments has declined because of low interest rates, Hankla said.

The revenue changes affect the so-called discretionary budget, which provides basic public services. That budget is $202.2 million this year.

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