Hawthorne Council May Let Voters Decide Fate of 2 Taxes

The city of Hawthorne, which in recent years was close to declaring bankruptcy, is planning to let voters decide in November if two taxes that generate a large chunk of the city’s budget should remain in effect.

On Monday night, the City Council, on a 3-0 vote with Ginny Lambert and Steve Andersen absent, agreed on a resolution to support placing the city’s utility tax and a business license tax on the ballot because Proposition 218 requires that special assessments be approved by a majority of the voters. The council will return in June for a final vote.

The utility tax, which was increased from 5% to 10% in 1995, and the business license tax generate $5.5 million a year, or about one-fifth of the city’s $29-million general fund budget, City Manager Bud Cormier said. It is the 5% portion of the utility tax that is up for voter approval.

For the past two years, the city has had a balanced budget and it is trying to secure a third year of economic stability. But if the taxes are not approved, each city department will have to reduce its budget 24%, Cormier said.

“We’re not fat and sassy, but we’re very stable,” he said.

That is a far cry from early 1995, when the city was facing a $10.5-million shortfall. To help pay the debt, officials were thinking of selling City Hall and the municipal airport and then leasing back the facilities.

Instead, Hawthorne eliminated the city Fire Department early this year. It aims to save $1 million a year by contracting with Los Angeles County for fire services. Budget reductions have been made in other departments.