COSTA MESA (CBS) — City Council members will decide on Tuesday night whether to outsource firefighting and other key services to help whittle down a multimillion-dollar budget deficit.

Council members canceled police participation in a helicopter program to help trim about $1 million annually beginning this new fiscal year, Councilman Jim Righeimer said.

However, the council still needs to fill a $1.4 million budget gap in coming months, with one projection pinning the city deficit upwards of $15 million starting July 1, said newly-seated City Manager Tom Hatch.

Hatch on Tuesday officially took over the position for Allan Roeder, who was the city’s manager for 25 years.

A big part of the problem is the city’s ballooning pension fund costs, Righeimer said.

“Ten years ago the pension fund cost us $5 million a year. This year it will cost $15 million and next year $18 million,” Righeimer said. “In the next five years it will cost $25 million to $26 million, and our budget is like
$91 million.”

Costa Mesa has been cutting its budget for the past few years, Mayor Gary Monahan said.

“It’s been very difficult,” Monahan said. “We’ve cut so many services to the residents, so many programs, and we’re still not there. We went from a $130 million budget to $94 million and that’s an incredible hit. Over 80 percent of our expenses are salaries and benefits and we have to find a way to get that number down.”

Righeimer believes it will help if many of the city’s services can be outsourced, because it will reduce the city’s pension fund costs.

One of the biggest proposals in the way of outsourcing has come from the union that represents the city’s firefighters.

Union leaders requested a proposal from the Orange County Fire Authority, and the study indicates the city could save $2 million to $4 million, Righeimer said.

“But I have pages full of questions” about the proposal, he said.

Having the Orange County Fire Authority provide Costa Mesa’s firefighting services could mean closing one or two fire stations, Righeimer said.

Righeimer and the mayor said the city has its own payroll department, where other cities have hired payroll companies to handle those duties.

Other public services that might be privatized include street sweepers, graffiti removal, park and street maintenance, running the jail, 911 police dispatch calls, building inspection and the city’s print shop.

But even if the council votes to pursue privatization plans, it doesn’t mean every service on their list will be outsourced, Monahan and Righeimer said.

City officials are required to give their employees at least six month’s notice of any attempt to farm out jobs, but the council members have the option of later changing their minds.

On top of the mounting pension fund problem, the city has also had to put off a lot of road improvements, Hatch said.

“We have a lot of capital needs in the community in general and as we’re cutting back on the budget we have deferred some maintenance issues,” Hatch said.

“All of those together are creating some need to see how we can do things differently to reduce our ongoing costs.”

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  1. alan hart says:

    Cities should not only outsource but privatize all city services. Private industry can always do things more efficiently for the taxpayers.

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