The City Council this week approved a $46-million budget that calls for increases in water rates, building-license fees, and hotel and street-lighting taxes, along with a 3% pay cut for all city employees.
The council, faced with a $5.6-million deficit, opted to strike a balance between raising new revenue and cutting services and salaries to balance the fiscal 1991-92 spending plan.
"I think it's remarkable that we have employees in this town who are willing to defer a raise that had been promised to them," Councilman Mark Leyes said. But during more than five hours of heated public testimony and debate Tuesday night, several city employees criticized the council for the financial crisis. They said they had been presented with a "lose-lose" option of either accepting a pay cut or facing layoffs.
"Employee morale has been impaired and confidence in the City Council is very low," said Jeffrey Allen, president of the 190-member Garden Grove City Employees Assn.
City employee Joan Ceplius accused the council of failing to consider long-range solutions to the city's budget woes.
"You are putting a Band-Aid on a major problem that really needs major surgery," she said. "A utility tax would be much more fair."
The council also drew fire from the business community on a business license fee increase, which will go from a flat rate of $30 plus $1.50 per employee to a fee based on gross receipts. The city's hotel bed tax, assessed against each hotel room in the city, also was raised, from 8% to 9%.
For homeowners, water bills will go from an average of $25.95 to $31.38 every two months, and annual lighting and park maintenance bills will increase by more than $22 to about $58 a year. City Manager George L. Tindell said that despite the increase, Garden Grove continues to have the lowest water rates in the county.
As a cost-saving measure, City Hall will now be closed every other Friday and between Christmas and New Year's Day.
City officials say the budget woes are due to a drop in projected sales tax revenue of more than $1 million, a bad economy and costly new state mandates, such as jail booking fees and air quality requirements.