ANAHEIM : $11.8-Million Budget Cut May Be Needed

Already reeling from a depressed tourism industry, city officials said Tuesday that $11.8 million more could be trimmed from its budget if the state elects to cancel payments allocated to cities from motor vehicle licensing fees and property tax revenue.

“Crisis, crisis, crisis,” Mayor Fred Hunter said, responding to questions about a city report indicating that the Legislature could cut the money flow to help plug its own deficit, estimated at $11 billion.

According to an Anaheim report, the League of California Cities is convinced that the Legislature and Gov. Pete Wilson will balance the state’s budget by taking money from local governments.

“The state needs to balance its budget, but don’t balance it on the back of the cities,” Hunter said.

The city has already cut 200 positions from its 2,200-member work force during the past two years because of the recession, and Hunter said it can’t afford to lay off more. Anaheim relies heavily on sales and hotel tax revenue it reaps from Disneyland, but those totals have lagged considerably short of past levels because of the stagnant economy.

“The employees that are left are frazzled and can’t do any more,” he said.

Both Hunter and City Manager James D. Ruth said they did not know which programs could survive more cuts.

If the state approves the plan, the money would no longer be deposited in the city’s general fund, which is projected to total $136.7 million for the fiscal year beginning July 1. The general fund--which pays for such services as fire and police protection, libraries and parks--stood at $131 million this fiscal year and $145 million two years ago.

Hunter said there will be no increase in city taxes to pay for any potential state cuts. The pledge not to increase taxes was part of an agreement Hunter said he reached with mayors of other California cities also expecting cuts.

Ruth said the anticipated state cut has thrown a wrench into the city’s budget planning process. According to the City Charter, the council must adopt a budget by July 1, but Ruth said the state is unlikely to make its decisions before mid-July. He said the city, for the time being, will have to adopt its budget with the assumption that the cuts will not occur.

“We have to wait for the other foot to drop,” Ruth said. “It would be totally irresponsible to do anything right now until we see what happens.”

Hunter and Councilmen William D. Ehrle and Irv Pickler said they may push for a charter amendment that would push the council’s deadline for adopting a budget from July 1 to Oct. 1, beginning in 1993. They said that would allow the city to review the state’s budget before adopting its own. The state is also supposed to adopt its budget by July 1 but often misses that deadline.

“We have got hundreds and thousands of employee hours invested in drawing up our (upcoming) budget . . . but next month we might have to tear it all up,” Hunter said.