The Long Beach City Council postponed a vote Tuesday night on a proposed $97.6 million budget that carries a 7.9 percent tax hike.
City Council members have three days — until 11:59 p.m. Friday to vote on the budget before it goes into effect.
The council is proposing amendments that could reduce the amount of the tax increase.
If a majority of the five council members fails to approve the budget or amendments, or if the council does not vote, the proposed budget and the 7.9 percent tax hike go into effect by default.
City Council members said they met for the first time on budget negotiations before Tuesday night’s meeting. The proposed budget was released April 10.
Council members proposed two sets of competing amendments that were still being calculated Tuesday night, before the city’s third budget hearing.
The council voted unanimously to table the meeting so the amendments could be submitted to the city manager and comptroller and released to the public.
Councilman John Bendo said discussions included personnel matters, which could not be discussed publicly.
“We were working on amendments before the meeting. It needed to be tabled so people had a chance to digest it,” Bendo said. “Tonight was the first time it was discussed. It’s kind of embarrassing.”
Bendo said council members were discussing areas to cut projected expenses and revenue that could lower the tax increase. He said he would like to reduce borrowing to pay for separation payments.
The tax increase is the equivalent to an average $305 increase on the average homeowner. The residential tax increase was proposed to bridge a $2.8 million deficit in the new fiscal year, which begins July 1.
It marks the second straight year of tax increases for residents after the city passed an 8.3 percent tax increase last year amid a fiscal crisis.
About 76 percent of the budget is accounted for in fixed personnel costs, including a $586,000 increase in health care and $1 million in contractually required union raises.
Management employees, paid firefighters and paramedics as well as new union employees contribute 10 percent to their health care costs.
The budget also includes bonding for $1.87 million to cover anticipated retirements that city officials said they cannot afford to include in the budget.
The city has about $109 million in long-term debt, mostly related to Sandy projects and a negative $1 million fund balance for the fiscal year ending this June 30.
In addition to the tax increase, the city is projecting $800,000 in new revenue from beach sales.
The budget also calls for increasing overtime projections by $140,000 to meet realistic trends. City officials said they could not reduce overtime for police officers and firefighters, who lead the city in overtime pay.
The state comptroller’s office found the city’s budget projections reasonable, but also said the city’s reliance on borrowing would further deteriorate city finances.
City officials are attempting a long-term fiscal recovery after nearly a decade of unbalanced budgets. Officials say an influx of $102 million in state and federal funding masked the city’s deficits and covered salaries and capital projects while the city suppressed tax hikes while residents rebuilt from the storm.