FULLERTON : Utility Tax Given Initial Approval

The City Council unanimously approved a 3% utility tax this week as part of a package to balance the 1993-94 budget. The tax would add a surcharge to water, electricity, telephone, gas and cable television bills.

The council will hold budget hearings in June and July, according to City Manager James L. Armstrong, during which the package will be discussed. The tax would begin appearing on residential and commercial bills in October, he said.

Low-income residents would be exempt from the tax, the council decided. Armstrong said city staff is working on a definition of low-income.

There may be a cap of $25,000 yearly for big businesses. The council asked city staff to meet with business people and discuss the cap.

The 3% tax is expected to raise about $2.6 million next year. The city is projecting a $4.2-million deficit without the tax and other measures.

The council also voted to cut $2 million in jobs from various city departments and offer a severance package to encourage employees to leave.

Council members Chris Norby and Julie Sa votes against a utility tax, but were outnumbered by Mayor Molly McClanahan and council members Don Bankhead and A.B. (Buck) Catlin.

“If we do see (the tax), we’re going to be stuck with it for a long time,� said Norby. His complaint was supported by applause from the audience.

“I think quality of life in Fullerton is very important,� Bankhead said to explain his support for the tax.