Fee increases approved to help midyear cuts

CITY HALL — Increased library fees approved Tuesday might help in the short term, city officials said, but they warned that larger efforts for all departments would have to be undertaken as the full impact of the slowing economy becomes known.

Library officials sought increased service fees — including raising the overdue charge from 20 to 25 cents per day for a new maximum limit of $15, instead of $8 — to supplement the $425,000 that was cut from their budget in June.

Other fees that were increased include those for returned checks, from $20 to $25, and for lost items, from $8 to $12.

The adjustments were introduced at a time city officials prepare for the next round of economic forecasts.

Hours of operation and part-time employee reductions have already been instituted throughout the library system to cope with the summer budget cuts. And discussion on the planned closure of the Chevy Chase Branch Library has been delayed for months as library officials wait for a more clear financial picture.

“Because of everything that’s been happening in the economy, we’ve been looking at all our budgets in a broader sense,” Cleary said.

Finance officials are scheduled to release data on the city’s third-quarter budget report in two weeks — the first true assessment of how the recent market turmoil and resulting downturn has affected city revenue.

Strategies on how to keep the 2008-09 budget balanced are expected to follow, but given recent market indicators, city officials have already begun to prepare.

In October, the City Council heard options for raising revenues, including introducing a business license tax and raising permit fees. Meanwhile, city executives have been pouring over possible cost-cutting measures.

“It’s going to be tough,” City Councilman Ara Najarian said Tuesday.

Just five months after the City Council cut the equivalent of 5% from each department’s budget, additional midyear adjustments may be unavoidable, especially given the budget pressure ratcheting down from Sacramento, city officials said.

But even those adjustments aren’t expected to produce much of a pad for next fiscal year.

“The likely shortfall in revenues that we expect this year will far outstrip small adjustments in revenues that will result from adjustments to existing fees,” City Manager Jim Starbird said.

The City Council was forced to trim $9.9 million to balance the budget in June, and that was before major market events shook the global economy. Now, with “bailout” an everyday term, city officials are already bracing for what’s in store for next fiscal year.

If the second-quarter figures were any indication, dips in tax revenue to the city could be steep. In the reporting period between April and June, new vehicle sales were down 23.1% over the same period last year.

Jewelry sales were down 21.7%, light industrial fell 15.4% and sales for lumber and building materials weren’t far behind, according to a city report.

 JASON WELLS covers City Hall. He may be reached at (818) 637-3235 or by e-mail at jason.wells@latimes.com.