Costa Mesa City Council OKs cuts, approves budget

One of the underpinnings for cuts, the conservative council majority argues, is that the city is facing rising pension costs. Costa Mesa spends about $15 million per year on employee pensions, and the city forecasts that number reaching $25 million in about four years. That number, though, assumes that the employee unions don't agree to pay some of their retirement costs.

During the recession, the city withdrew more than $30 million from its reserves.

Leece said the city doesn't have a budget crisis that would justify firing public employees, especially police officers. About 20 police officers have applied to work in other municipalities, union representatives say, in advance of the restructuring proposal.

"One city cannot accomplish pension reform without severely damaging that city," Leece said.

Other opponents of the council majority, led by the Orange County Employees Assn., have conducted a PR campaign attacking the conservative philosophy of outsourcing, and have tried to engender sympathy for city employees.

Lisa Major, assistant general manager of the Orange County Employees Assn., presented the results of an audit funded by OCEA. It examined the city's 2008, 2009 and 2010 financial statements, and said the city could reallocate $26 million to possibly save city services and jobs, among other recommendations.

Councilman Steve Mensinger disputed that the audit had found any unused funds.

"This isn't hidden money," he said.

Righeimer added: "This whole list is a road to bankruptcy."

The city will study the OCEA audit in more detail, Hatch said.

Earlier, Colin McCarthy, president of the Costa Mesa Taxpayers Assn., critiqued the city budget. McCarthy is also a planning commissioner. He said the city should be more conservative with its sales tax estimates, and that it should spend more money maintaining City Hall instead of paying as much as it does in salaries. McCarthy also said the city should contain "skyrocketing" firefighter overtime.

In April, the city forecast a $5-million deficit, but various department heads revised their annual requests and the deficit was cut to $3.3 million. Since then, Hatch proposed a series of cuts that eventually balanced the budget.

One bright spot in the budget is an expected increase in sales-tax revenue, the city's largest single revenue source. The city's total sales-tax receipts climbed 14% in the past year to $39.4 million, and are expected to reach $41.7 million this coming fiscal year

By The Numbers

CEO Tom Hatch has suggested the following changes for budget savings, among others:

$1.4 million savings by restructuring the Police Department

$283,000 savings by using narcotics seizure funds for police dispatch computer equipment

$200,000 less to update the general plan

$174,000 savings by eliminating the telecommunications manager position

$140,000 savings by eliminating the emergency medical services coordinator position

$98,000 savings by eliminating one of three animal control officers

This corrects an earlier version.