The Morning Report
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Something changed the moment San Diego Mayor Jerry Sanders emerged from a backroom Friday afternoon to meet the television cameras, city staffers and the four City Council members all waiting for him.
“It’s really quiet,” Councilwoman Sherri Lightner said before Sanders took his podium. “You can tell there’s a presence in the room.”
It’s a presence that up until Friday had been missing from the public debate on the city’s financial future, despite the frenetic activity by City Council, direness of gaping budget holes no one knew how to fix and the mayor’s legacy on the line.
Sanders now has arrived to champion a financial recovery plan developed by his most formidable political rival, but one that needed his backing. Without him, the package is an organized labor-backed money grab. With him, it’s a comprehensive financial solution to the city’s unending fiscal woes, one that pairs cost cuts good enough for a business-friendly mayor with revenue increases that give labor unions the incentive to make a deal.
It’s also likely the last, best opportunity for both him and City Councilwoman Donna Frye, the plan’s chief architect, to do what both promised when they squared off in the mayoral election five years ago: Solve the city’s financial problems.
At its base, the plan is a voter-approved temporary sales tax increase triggered once the council completes a series of retirement cost and outsourcing reforms that have lagged for years.
For the council members in favor, and now Sanders, it’s a “historic agreement” and “reform before revenue” approach that represents the only responsible fix to the city’s financial health.
To reach this point it took a month of frenetic activity unlike any in recent memory, perhaps a time not seen at City Hall in five years — when poor financial decisions and the scandals that followed them led to federal investigations, the scorn of the national media and forced Sanders’ predecessor out of office.
Friday morning, the drama continued. Minutes before the council held a special meeting on the city’s finances, the mayor broke a weeks-long public silence on a ballot measure. He issued a memo saying he wouldn’t oppose a package developed by Frye and later joined by Councilman Todd Gloria.
As Sanders watched the council proceedings from his office one floor below, Councilman Tony Young made his move. He argued the city shouldn’t increase taxes until all the reforms listed were complete, rather than simply one set of reforms envisioned by Frye and Gloria. His logic convinced Lightner.
The Frye/Gloria package failed 4-4.
But Frye quickly ceded to Young’s demands, picking up his and Lightner’s votes and ensuring the 6-2 council majority needed to put a sales tax increase on the ballot.
The final measure calls for the city to make a series of pension, outsourcing and retiree health care reforms prior to collecting any revenue from a half-cent sales tax increase, which would last five years. The tax increase, which is estimated to raise about $100 million annually, could cover the city’s projected deficits and restore some prior cuts including those to the Fire Department that resulted in the department’s slow response in the choking death of a 2-year-old in Mira Mesa last week.
At his press conference, Sanders said the reason he was now backing a tax increase for the first time in his tenure was that the whole package would finish the reforms he’s pushed for since he entered office.
He sharpened likely the best argument for passage: What happens if the ballot measure fails. Sanders said as many as 700 sworn police officers could be laid off, half the city’s fire stations could be shuttered, and recreation centers and branch libraries could be closed.
“I don’t think the citizens of San Diego want us to go down that road,” Sanders said. “No right thinking person does in my estimation.”
Further, Young’s action might have siphoned off some in the business community who had expressed their opposition.
Lani Lutar, head of the San Diego County Taxpayers Association, said her organization would reexamine the proposal in light of Young’s amendments. Vince Mudd, a key business leader and confidant of Sanders, called Young’s effort “courageous.”
Without Young’s insistence on reforms first, Mudd said, “what would have happened today would not have been nearly as effective.”
Serious and legitimate questions remain about the plan’s viability and success. City Attorney Jan Goldsmith and his office must craft legal language to ensure the reform triggers desired by council have teeth but don’t make the wording hopelessly confusing for voters.
Opponents, such as Councilmen Kevin Faulconer and Carl DeMaio, rightfully pointed out that many of the reforms listed in the ballot measure are those the council has been working on already for years with no success. Further, they argue, no one knows how much money the city might save by implementing all the reforms. They expressed doubt that the package alone could fix the city’s mounting obligations forever. It was another example, they said, of city politicians kicking the can down the road on the backs of taxpayers.
“This isn’t the ‘Reform Before Revenue Ballot Measure,’” DeMaio said. “It’s the ‘City Politician Dash for Cash Ballot Measure.’”
Then there’s the campaign. Voters in a famously tax averse city must be willing to pay more to the city’s piggybank at a time of national recession. DeMaio already pledged to use his personal funds to fight the tax increase.
But the mayor’s involvement should help with that effort. The mayor brings conservative credibility and his bully pulpit. Already he removed a new $294 million City Hall from the ballot, and said Friday he was concerned the two measures might have conflicted in voters’ minds.
The irony, of course, is that Friday brought full circle the city’s history over the last five years. Sanders defeated Frye in a special mayoral election in 2005 as he thrashed Frye’s financial recovery plan because it included a tax increase.
Now Sanders is endorsing the plan Frye scraped together over the past week. For years, Frye said, cut after cut has not brought the city to the point that its financial woes are behind it. This proposal, she said, just might.