Salt Lake City budget officials have found another wrinkle that could equal up to a $1 million black hole in the fabric of the city's budget.

With the City Council scheduled to adopt a budget in just over a week, officials have received estimates that the city's share of property tax revenues will be $500,000 to $1 million lower than expected.The revenue shortfall comes as a blow to the city's budget officials, who used a "spending embargo" to slice another $1 million out of the current budget when sales taxes revenues came up short. This year was the third in a row that the city's budget has suffered a major shortfall in January, at the half-way point of the budget year.

"We're going to have to scramble," said City Treasurer Buzz Hunt. "The revenues are disappointing, and they are curious, and I have no explanation of why they have gone down that much."

Mayor Palmer DePaulis is expected to recommend additional cuts to his $80.3 million budget proposal to the City Council on Thursday. He already termed his financial plan for the 1988-89 fiscal year as "sobering."

Hunt said the property tax revenue figures are just estimates, and the numbers won't be final until June 8, just one day before the council is scheduled to adopt the city's 1988-89 fiscal year budget. An early peek at the numbers sent city budget officials scrambling to put together a plan of additional cuts in order for DePaulis to recommend a balanced budget to the council.

Last year, the value of centrally assessed property taxes within the city - including railroads, mines and utilities - increased by $90 million. This year, despite a flat economy, the same properties suffered a $76 million decrease in assessed value.

"The economy remains consistent, and yet we have a roller coaster," said City Finance Director Lance Bateman. "We just keep getting hit."

But Lee Shaw, State Tax Commission spokesman, said the economy is to blame for dropping property values within city limits.

"The fair market value of that property went down because of the economic factors involved in our economy right now. We're in a phase that a lot of people never expected to see, (a phase where) property valuation does not always increase.

"Part of it is getting used to the fact that we're in a world where property values can go down."

Hunt said that last year the city received a $400,000 surplus to the $18,217,000 budgeted in property tax revenues. This year, the city's budget was based on that same $18,600,000.

DePaulis credited the dismal economy for his recommendation of a city budget that is 1.5-percent less than that adopted last year. Controversial cuts have included elimination of the police department's crime prevention and crime analysis units, no raises for city employees, turning off some street lights on major streets and shutting one eastside fire station, while a new consolidated station is built.

City council members, who have heard complaints about programs cuts, have identified about $2.5 million in wish-list items they'd like to fold back into the mayor's budget. So far, the council has identified only about $290,000 in cuts.