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NEWS IN BRIEF: A summary of developments across Los
Angeles County | Community News File / Long Beach

Budget Deficit Persists Despite Rising Tax Revenues

April 18, 1998

Although tax receipts are increasing as the economy improves, Long Beach's stubborn operating budget deficit remains, according to a financial report released Friday.

In a final accounting for the 1997 budget year, the report said the city was able to pay its bills only by spending $24 million from reserves and one-time budget adjustments.

It said the city had "a structural deficit," meaning incoming tax revenues were not enough to pay for ongoing city services. The report blamed the local economy and state claims on city property tax dollars.

"This structural imbalance is attributable to a revenue base that has been eroded by the recession, naval base closures and the loss of millions of dollars of property taxes to the state," the report said.

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