Mission Viejo Leaders Have 2nd Thoughts About Rebate : Budget: City Council members say they acted too hastily in expressing support for the plan and that they want to get further information and hear public comments.

MISSION VIEJO —  Less than three weeks after enthusiastically embracing a proposed multimillion-dollar tax rebate program, City Council members said Friday that they acted too hastily in publicly expressing support for the plan.

Although they did not reject the rebate idea outright, three of the five council members said they want to take a long, hard look--and hear comment from citizens--at the proposal.

The city has a $21-million budget surplus, but only $5 million of that is not earmarked for municipal projects or programs.

“I won’t proceed one inch on the whole rebate issue without a thorough analysis by staff of our present and future fiscal needs,” Councilman Robert D. Breton said Friday. “The more I reflect on this concept, the more I think it’s shortsighted.”

“It’s not that I’m backpedaling on the notion of a rebate,” he added, “but if I could rewind the clock at the first suggestion of a rebate, I don’t think I would comment on the notion until we had all the financial information in front of us first.”

In a lively, often-chaotic press conference on Christmas Eve, Councilman William S. Craycraft announced plans for a $10-million rebate that would give each property owner in the city a $500 refund.

Some council members at the event accused Craycraft of grandstanding, saying that he never consulted with the city financial staff and that only $5 million of the $21-million is not reserved. Despite that criticism, however, they expressed support for the rebate idea.

“The whole thing caught us in a reactionary mode,” Councilwoman Susan Withrow said Friday. “As we find out more about our financial situation, little red flags are jumping up all over. . . . It’s time now to regroup and be practical and analytical about this.”

Citing uncertainty over the financial impact of Craycraft’s proposal, the council at its Dec. 30 meeting rejected a $10-million rebate but did say that it would consider a smaller refund program. A committee appointed by the council last week is now looking at rebates in the range of $25 to $50 per property owner, Mayor Sharon Cody said.

“There’s a big process to go through before any rebates can be approved,” Cody said. “We’ve got a lot of decisions to make and other projects that aren’t funded to think about, such as expansion of our library and improvement of our recreation centers.”

Cody added that City Hall has received a flood of complaints from residents who think the money might better be spent in other ways.

Cody said “about 99%” of the phone calls and letters she has received from citizens oppose the rebates.

“The message to us was, ‘Please think this through,’ ” Cody said. “These people feel strongly that rebates are the wrong thing.”

Ironically, although Councilmen Robert A. Curtis and Craycraft were at odds during the Dec. 24 press conference, both still support a multimillion-dollar rebate plan.

In interviews before and in statements made during the press conference, Curtis, then the city’s mayor, said he came up with the idea for the rebate plan first and was planning to announce it during a Dec. 30 “state of the city” address. Craycraft said he did not take the idea from Curtis and has always maintained his support of returning unused city funds to taxpayers.

“I’m very comfortable retuning money to the taxpayers at this time,” Craycraft said. “In lieu of that, I’d like to look at some method of lowering the tax rate in Mission Viejo.”

Craycraft said the proposal for a $10-million rebate is still viable because Mission Viejo has little overhead, because of its low employee-to-resident ratio and because it will not have large operating costs for city workers in the future.

Craycraft added that he did not consult with the city staff or fellow council members before calling the press conference because “those who like to freely spend taxpayers’ money are going to look hard to find places where they can put this cash reserve. I think it should go to the taxpayers.”

According to city financial officers, about $5 million of the $21-million budget surplus is not earmarked for any project or program.

Breton said an alternative to simply disbursing the excess $5 million could be a program to give Mission Viejo residents the interest from the budget surplus.

The council will set a date for a public Town Hall meeting to discuss ideas on how to use the budget surplus at its meeting on Monday. .