With news last week of the city of San Diego’s massive $179 million budget deficit, discussions are beginning on how to fix it both now and in the future.
In the spirit of starting dialogue, I have two general questions I’m hoping will focus some discussion:
1. What could the city do to get out of its $179 million deficit this year?
2. What could the city do so it never faces a deficit like this again?
This week, we will have guest bloggers addressing these two questions in a few paragraphs. I’d also like to encourage reader participation. Please e-mail or tweet me your thoughts on these questions. I’ll post the best answers on Friday.
Graciously stepping up to kick us off this afternoon is Murtaza Baxamusa. Baxamusa is a research analyst with left-leaning think tank, Center on Policy Initiatives. Here is Baxamusa’s response:
When an independent audit of the city’s retirement system and sewer rates by Kroll in 2006 found there was a structural gap between the city’s revenues and expenditures, it recommended a balanced approach:
Revenue per capita has been increasing, but is less than that of other large cities. In order to maintain current service levels and address issues such as deferred maintenance, the City must reduce expenditures by improving efficiency, increasing the current revenue base, and seeking alternative revenue sources.
The Mayor had a knee-jerk political response to the Kroll report:
I think the voters appropriately expect the government should be able to live within its means just as citizens do in their own homes across our City. Consequently, we will have to make cuts to the costs of operating City government.
The Mayor thus released his first Five-Year Plan later in 2006 with the capitalized assumption “NO NEW REVENUES.” The plan extended through Fiscal Year 2012, and projected a deficit of $179 million though the five years. Regardless of how well or how badly the economy did, the Mayor led us on a path of recurring deficits, and recurring cuts. In response to the problem of structural budget deficits Chief Operating Officer Jay Goldstone stated bluntly: “What areas to cut and how much will be debated in the upcoming budget discussions.”
Since then, the leadership of America’s Finest City has slashed, chopped and burnt its fineness. Service levels have been cut in every area, from libraries and parks, to street cleaning and maintenance. Even in difficult times, when working families rely on our public services, such as swimming pools and recreation centers as refuge from the harsh realities of tightening purse-strings, the city has let us down. One budget after another, the community bled in the services being provided in the hope that the city would recover in the next budget year.
We are now led to believe that three years of cuts has led us nowhere.
You do not sink into a $200 million grave in one day. You do it by digging deeper and deeper, whilst foolishly thinking that there is gold at the bottom of the pit. You dig for glittery chimera like “managed competition” which has strewn the federal government with private contractor waste, fraud and abuse and you dig for occasional one-time trinkets like reserves that make it worth the digging. The hallucination induced by state cuts distorts the perception of depth. And then, when it rains, as with a bad economy, you go sliding down deeper into your own hole.
These numbers confirm that the mayor’s unbalanced plan based on cuts alone has failed. It is therefore time to stop talking about cuts, and start talking about revenues. In the same way as a working family endures hardship to a point, and then starts to plan about raising income. Citizens have lived within their means long enough, and now it is time to put the means on the table.
Thoughts on Baxamusa’s argument? Post your comment in The Hall blog if you’re not there already.