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Council Faces $2-Million Budget Gap : Revenue: Sales tax receipts are off. And a population decline may cost the city state and federal money.

June 27, 1991|MICHELE FUETSCH | TIMES STAFF WRITER

A multibillion-dollar state deficit, the recession and a population decline have left Lakewood with an estimated $2-million shortfall in next year's budget, city officials said.

The City Council had planned to consider the budget Tuesday, but deferred action in hope of getting a clearer picture of how much money it can expect from Sacramento in the 1991-92 fiscal year. The council has scheduled a special budget meeting at 8:30 a.m. Saturday.

State officials are still trying to hammer out an agreement on how to close a projected $14.3-billion deficit in California's budget next year.

Some of that deficit is expected to be erased at the expense of local governments. For example, state officials already have said they plan to keep a larger portion of the state motor vehicle license fees that it shares with cities. Officials have not decided how much to retain, however.

After June 30, without a spending plan for the new fiscal year, the city will have to operate on a continuing resolution until the state deficit problem is settled, Lakewood public information officer Donald Waldie said. If the situation in Sacramento is clarified this week, Waldie said, the council plans to adopt a budget next week.

A year ago, the council approved a two-year spending plan that provided $26.4 million this year and more than $28 million for the next fiscal year. The revised proposal for the new year has been scaled back to $26.7 million.

City officials said that declining sales tax revenues, a residue of the area's recession, contributed significantly to the scaled-down spending plan. Officials said sales tax revenues fell as much as $800,000 below their projections of $7.9 million this year.

The 1990 census results, which showed a decline of 3,111 in the city's population over the last decade, also will have a financial impact, city officials said. The decline to 73,557 is expected to cost the city around $180,000 in state and federal money during the coming year. The city's share of the state gasoline tax and federal community development money is based on population.

Despite Lakewood's shortfall, officials are saying they will be able to avoid layoffs or significant cuts in service. They plan to raise specific fees, such as those in the building and planning departments, and shrink the city work force by not filling vacancies.

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