SANTA ANA — Residents will have to pay more for utilities, garbage collection and other services under a proposed $242.4-million budget released Wednesday by City Manager David N. Ream.
Ream blamed the need for utility-tax and fee increases on state and county governments, which have shifted their financial burdens to the cities, resulting in a total of about $5 million in lost revenue and new costs for Santa Ana.
"We simply cannot write a $5-million check to the county and state to cover the state bills that they are asking us to pay for without new revenues," he said in an interview.
Despite the bleak outlook, the city will be able to finish the final year of a five-year capital improvement program that includes street and sidewalk repairs, Ream said.
"It is disheartening to us to have met our goals and find out that we have to ask the taxpayers of this community for more money to pay someone else's bills," he said.
The financial blow to the city has been compounded by a projected $1.7-million drop in sales tax revenue.
But compared to other Orange County cities that are also suffering losses in sales tax revenue because of the economic slump, Ream said Santa Ana "was very fortunate to have such a small decrease" in that revenue category.
The proposed budget, which will be formally presented to the City Council next week, does not include money for 10 new police officers that would have completed a five-year commitment to increased staffing, additional firefighter positions or new code enforcement officers to fully implement the "neighborhood standards" ordinances recently approved by the City Council.
"We will not be able to do everything we would like to do," the city manager said. "We will have to prioritize our efforts to make sure we spend our time and money where we have the biggest payoff."
Although the proposed budget reflects a 10.8% increase in spending over last year, some services will have to be cut, including a literacy program run by the library and the Seniors Shared Housing Program, a referral service for senior citizens looking for house-mates. Ream said the city is attempting to focus only on "essential" city services, and the programs that face budget cuts are those duplicated by other agencies.
Also to be cut from the budget are 21 city staff positions, including 10 that are filled, either through layoffs or demotions.
The increase in the utility tax from 4% to 5% is expected to cost the average residential customer an additional $1.50 each month, Ream estimated. The tax applies to gas, electricity, telephone and, for the first time this year, water services.
The staff cuts and the utility tax increase alone should raise the $5 million needed to meet state and county mandates, Ream said.
In an effort to balance the state budget last year, legislators took money from the counties but allowed county officials to increase the fees charged to cities to house their prisoners in county jails. The counties were also allowed to increase fees for the collection of property taxes.
The increased jail booking fees will cost Santa Ana about $3 million and the property tax collection fees will cost another $1 million, Ream said. Additionally, the state will keep $1 million in vehicle license fees that would have gone to Santa Ana, he added.
The cost of residential garbage pickup, totaling an average of $19.72 every two months, will increase by just under $2 because the county increased the landfill fees charged to trash haulers, city officials said.
Other fee increases included in the budget, averaging about 5%, are intended to help the city meet the cost of providing services, Ream said.
For motorists who violate the "no parking" ordinance on street sweeping days, the cost of the citation will go up from $27 to $37. If an automobile is towed, the cost to get it out of impound will increase from $10 to $35, city officials said.
Ream said the aggressive capital improvement program for neighborhoods--including street and sidewalk repair and tree maintenance--will stay on track, funded partly by a redevelopment program.
"We will not go backwards on our commitment to enhance the maintenance levels in our neighborhoods," he said.
About $25 million was spent in first four years of the capital improvement program.
Also budgeted are design costs for a police facility, 200-bed city jail and a maintenance yard.