By Mona Shadia, mona.shadia@latimes.com

June 22, 2010 | 11:05 p.m.

Shared From the Daily Pilot

The Costa Mesa City Council voted Tuesday to approve the city’s 2010-11 fiscal year budget after nearly three hours of back-and-forth debate and attempts by council members to save some of the programs and employees’ jobs. Councilwoman Katrina Foley, refusing to support the layoffs, cast the sole dissenting vote.

The council voted to eliminate many city programs and 24 full-time positions. Twenty-six other positions were reduced to part time or left vacant. The city also plans to reduce hours for another 26 part-time positions to help balance the budget.

Costa Mesa is facing a projected $16.4-million deficit in next year’s budget. The program cuts and layoffs account for about $8.4 million in savings. An $8 million deficit remains.

The City Council also voted to add the much sought-after Recreation on Campus for Kids After School (ROCKS) program into the budget, the Youth Sports Programs, and keep the recreational coordinator position while it looks for grants and matching funds to finance them.

The City Council will revisit the programs’ costs in August to see if enough funds were generated to keep them. If in August enough funds were not generated, the programs will be eliminated.

This will mean Costa Mesa Residents who use the Rocks program should stand up and support the program by raising the needed $28,000 per school.

Costa Mesa will retain Yolanda Macias, an animal control officer, a move that relieved many of her supporters.

The city also plans to increase its animal licensing fees to generate funds and support Macias’ position.

The City Council also voted to place a 2% increase to the transient occupancy tax, or hotel tax, on the November ballot. If passed, Costa Mesa’s hotel tax would still remain lower than the county average.

Foley attempted to gain support for a 3% increase, but her motion failed.

Before voting on the budget, Foley motioned to adopt the budget without laying off any of the employees, leading the city manager and his staff to ask for a break to discuss how such a proposal would work.

When asked how can the city make up for $2.2 million it would save through layoffs, Foley suggested using the city’s reserve funds.

Foley’s position led to a heated exchange between her and Councilman Eric Bever, who views things from the other end of the spectrum.

“I understand your desire to keep everyone employed … it’s fiscally irresponsible. We have an 800-pound gorilla, the other $8 million that we haven’t even addressed yet,” Bever said. “Something that I don’t think you realize is that last fiscal year, our cost for staff was 110% of our revenue. When you compare money that came in, 110% went to staff cost. We can’t continue down that road.”

Foley took issue with his saying “fiscally irresponsible.”

“I was trying to come to a compromise. If this proposal goes forward, there will be a significant reduction to staff,” Foley said. “Just like in my business, every year I consider an increase in my fees … we all increase our costs to our customers to be able to pay for our overhead. It’s something that happens in our businesses and the city of Costa Mesa does not apply that business model. That to me is what’s been fiscally irresponsible. It’s hoping South Coast Plaza and the auto dealers do really great every year.”

In other council business, the Orange County Fairgrounds Authority, which comprises the five council members, voted unanimously to enter into an agreement with Facilities Management West, which is exclusively working with the city on a financing and operating deal for the 150-acre property.

The agreement calls for a 55-year lease with the group. Costa Mesa will receive a minimum of $750,000 annual rent plus interest from the group for the first five years.

The amount will be increased to $1.5 million on year six through 10, and to $2.5 million beginning the 11th year and will increase again every 10 years.

The agreement also allows the city to receive a portion of the revenues made from operating the fairgrounds.

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