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Tuesday, Sept. 15, 2009 | For the past week, all most people knew about the fiscal policy speech Mayor Jerry Sanders delivered today at a hotel ballroom in Mission Valley was the title: “Building For the Future Despite the Economic Downtown.”
It turns out that the title, in many ways, was all people needed to know.
Sanders spent much of his half-hour speech Tuesday on building: A new City Hall, a new downtown library, an expanded Convention Center and what to do with Qualcomm stadium. Current price tags for the first three — there’s no Chargers project on the table — total upward of $1.6 billion.
These efforts come amid a severe national economic recession, increasing city budget deficits and a historically high pension commitment. The mayor has promised not to use any existing general fund revenue to cover any of the $1.6 billion.
But not only should the city move forward with the projects, Sanders said, but those who don’t believe the city can do it are shortsighted “defeatists.”
“As we look for ways to protect our general fund and the city services it provides, we cannot allow our judgment to be clouded by the defeatists who think the only response to a weak economy is to abandon our aspirations,” Sanders said.
“Virtually every major project in the city has encountered opposition from groups who have no faith in tomorrow, who view all progress with suspicion, who don’t believe we deserve to be a great city,” he continued. “If these people had their way, we’d still be riding ferries to Coronado.”
Some of the speech’s most quotable lines — calling the current City Hall or Civic Center “an asbestos-lined money pit that doesn’t meet fire or earthquake codes” — came from his arguments for these projects’ necessity.
Even Sanders’ verbal faux pas — saying “erection” instead of “election,” arousing laughter and red faces all around — had a building-related connotation.
In the long run, Sanders said, the three projects will save the city money (City Hall), make the city money (Convention Center) or use money that would otherwise disappear (library).
During his speech, Sanders didn’t discuss further options for funding any of these projects, all of which have their question marks.
Afterward, he addressed the status of each. He said the estimates for the library might come in lower than believed.
“I think the Civic Center as long as we can get to work with the developer and promise that we return money to the general fund every year for 30, 40 years, then we’re on track with that,” he said, adding: “Then the Convention Center, that’s the bigger ‘if.’ That’s working with industries around San Diego to see how we can finance that without using general fund money.”
None of these arguments are new, and that could have been a theme for the entire speech. Unlike an address last October, also delivered at a gathering of the San Diego County Taxpayers Association, this one did not reveal any big news, such as cuts to city services. Instead, on Tuesday, Sanders used his platform to talk big buildings and delineate a laundry list of previously advertised budget fixes.
In the last year, he said, the city closed a $175 million gap in its budget. Next year’s budget deficit, Sanders said, will “dwarf all of its predecessors.”
Solutions listed by Sanders included allowing more competition from private business. He trumpeted last week’s decision to rebid a portion of the city’s information technology services now provided by a city-created nonprofit. He referred to “managed competition,” an outsourcing program that would allow private companies to bid for city services. That program, approved by voters in 2006, has been beset by administrative and legal delays, and strong disapproval from organized labor. It has yet to be implemented.
“But, as you know, the will of the people is held in higher regard by some groups than by others,” Sanders said in his speech. “And so the development and implementation of a managed competition program has faced tremendous obstacles and setbacks. But my administration has made, and continues to make, implementation of managed competition a top priority.”
On the biggest drain to the city’s finances, the pension system, Sanders touted reforms for new employees which he stated would save the city $22.5 million annually in the long run. But for next year, that savings is only $500,000.
A few times in his speech Sanders referred to next year as having, “the largest pension bill in the history of the city of San Diego.”
“There has been considerable speculation about what the size of that payment will be, but whatever the amount, let me be clear: We will make our full pension payment, to the penny,” he said.
There is a movement afoot, however, to change the pension system’s accounting in order to lower that bill.
Next year’s payment will be anywhere from $39 million to $71 million more than this year’s, according to two scenarios to be considered by the city’s retirement board this week. The following year’s payment, according to the same estimates, could be almost $100 million more than this year’s total.
Issues like this one that left Councilman Carl DeMaio less than impressed with the speech.
“When I think about legacy, I think San Diegans wouldn’t define legacy as ‘build a bunch of new city buildings,’” DeMaio said. “I think San Diegans are craving a legacy of a city government that is financially healthy and provides the basic services in an efficient and effective way. The legacy they seek is good government and I didn’t hear a lot of that today.”
But Councilman Todd Gloria said Sanders’ speech as a whole challenged “San Diegans to be optimistic.”
“I think whether it’s constructing the three large infrastructure projects and suggesting that they need to move forward or when it comes to holding the line on neighborhood services, his message is spot on,” Gloria said.
As for “defeatist” opponents mentioned throughout his speech, afterward Sanders declined to name names. But he made another distinction between them and him using a word popular in today’s political parlance: Change.
“San Diego has a history and maybe every city does of people who don’t want anything to change,” he said. “I certainly understand that and I respect that to some extent. But sometimes it’s just, ‘We don’t want us to change because we don’t want us to change.’ I think you have to look at a city and see that there’s long-term investments that need to be made.”