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Long Beach : City Manager Issues Bleak Financial Picture for 1992-93

February 11, 1993

Painting a bleak financial picture for Long Beach, officials reported this week that the city expects to receive $4.2 million less than anticipated in fees and taxes this fiscal year.

Most of the city's major revenues are below 1991-92 levels as the area continues to feel the pinch of the recession, City Manager James C. Hankla said in a midyear budget report to the City Council.

For example, the city's business license tax is expected to generate $230,000 less in 1992-93 than in the previous fiscal year. Meanwhile, a decrease in the number of building permits and zoning fees is expected to cost Long Beach $556,000. And a hotel bed tax will provide $279,000 less than anticipated to the city, partly because of the closure of the Queen Mary, Hankla wrote in his report.

To offset the expected shortfalls, Hankla proposed using $4.5 million in onetime payments to the city from the new cable franchise and Southern California Gas Co.

Hankla did not foresee further spending restrictions before the fiscal year ends in June, but he said that next year might get tougher. The current budget, for example, includes $6.3 million in programs--including parks, recreation and library services--that were paid for with onetime funding sources. The city does not know how it will pay for those services in 1993-94, he said.

Meanwhile, the state might also shift some property taxes away from local government to help fund schools. "We are currently determining what the city's share of that shift would be. It would be substantial, however," Hankla said.

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