Budget gap is gaping

CITY HALL — Severe drops in sales tax and other revenue for the city have created an $8.4-million budget gap this fiscal year, officials reported Tuesday, setting up a citywide hiring freeze and the elimination of 24 vacant positions.

In a special City Council budget session Tuesday morning, city officials said they would suspend the use of general-fund money to pay for road improvement projects or augment the capital-improvement budget, instead using funds generated by the state gas tax.

They also planned to pursue opening the city-owned Scholl Canyon Landfill to other cities to offset revenue loss there. Dump rates have dropped in recent months, with revenue down by about $230,000, city officials said. Opening the landfill up to outside agencies for the interim could make up the difference, they added.

Taken together with other cost-cutting measures, the plan was expected to generate $8.46 million in savings and additional revenue, enough to close the current gap.

Nearly all the city’s revenue losses have come as a result of the worsening recession, with a $3-million drop in sales tax revenue and another $3-million hit to money generated by city permit and public services, city officials said.

The city’s money-losing Passport Services program will be eliminated for a $55,000 savings under what City Manager Jim Starbird called a “rather blunt” cost-cutting plan.

“We don’t see revenue generation as the solution to this problem,” he said. “This is going to be about cost-cutting.”

The City Council was also scheduled to meet in closed session Tuesday with the city’s four main employee unions to discuss their role in helping to shore up the city’s large budget shortfalls.

“We’re ready to talk, to help the city through anything they need,” Chris Stavros, president of the Glendale Firefighters Assn., told the council. “I think we have a responsibility to do that.”

But several public speakers at the meeting, representing mostly downtown merchants and local real estate groups, took a preemptive stand against any possible cuts to police or fire agencies, which saw reduced staffing as part of the effort to balance the projected shortfall for this year’s budget.

Aram Avedian, outgoing president of the Glendale Assn. of Realtors, even suggested the council explore possible tax or fee increases to augment public safety budgets.