City Hall was consumed with the specter of budget cuts today, a day after Mayor Jerry Sanders disclosed a $43 million mid-year deficit.

“Looking ahead, we are all going to be called to do what we can,” said Council President Scott Peters in a prepared statement. “It’s not going to be easy, and we’re not going to like the cuts that will be necessary. However, we will make sacrifices as we need to, and will include our own offices and our own budgets.”

Peters added that he will “deal with this deficit in a sensitive manner, respectful of the likelihood that there will be people who will lose their jobs.”

Current projections show the city $43 million in the hole just three months into the fiscal year. Local tourism, sales tax and property tax revenues have plummeted this year in response to the housing bust and a ballooning credit crisis that threatens the worldwide economy.

Sanders has not yet offered specifics on cuts except to direct all city department heads to review their operations and present him with recommendations for a 10 percent reduction in expenses. The mayor is scheduled to present a package of cuts to the Budget Committee on Nov. 12. The full City Council will likely take up the issue at its Nov. 17 meeting.

Independent Budget Analyst Andrea Tevlin has issued recommendations for cuts that include freezing travel, training, equipment purchases, overtime pay and even a mandatory one or two-week furlough for city employees. Although Tevlin’s office has yet to be able to verify a $43 million deficit, it reported a combined $33 million drop in property tax, sales tax and transient occupancy tax revenues.

Councilman Tony Young said he supported Tevlin’s approach, saying his goal “will be to ensure that we do not have long-term suffering resulting from reduced services.”

Earlier today Councilman-elect Carl DeMaio proposed a laundry list of cuts for City Council operations, Tevlin’s office, the San Diego Ethics Commission and the City Attorney’s Office.

DeMaio said decisions on cuts must be made quickly, saying “with each passing day it becomes harder to balance the budget.”


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