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The vow was familiar, one San Diego Mayor Jerry Sanders has made in lots of speeches.
“Today I present to the people of San Diego a budget that brings us ever closer to achieving what I’ve made clear is my highest priority: eliminating the city’s longstanding structural deficit,” Sanders began.
Thursday’s occasion was the release of Sanders’ next-to-last budget as mayor, but the statement could have been from the first time he put out a budget in 2006. Sanders was elected to fix a budget crisis that forced his predecessor to resign, sparked legal and financial investigations and made San Diego the national model for fiscal mismanagement.
Sanders’ mandate: to end ongoing budget problems, a “structural deficit” where expenses outpace revenues year after year.
Some of the problems the mayor has faced aren’t of his own doing. Decisions by previous mayors and City Councils to underfund the city’s pension system wreaked such havoc that they continue to tighten an annual noose around the budget. The collapse of the national economy in 2008 depleted the tax revenues Sanders needed to pay for services. The mayor is quick to remind everyone of these predicaments in speeches like these, though he was well aware of the pension problem when he took office.
Many of his own big ideas, however, haven’t been solutions. A ballot measure passed in 2006 allowing private companies to bid on city services has yet to result in any savings. A hurried ballot measure to hike the sales tax failed in November. The latest answer, one that would give most new city workers 401(k)s instead of pensions, wouldn’t be on the ballot until next June and it’s unclear how much the city might save.
The budget fix Sanders presented Thursday was, by all accounts, draconian. He wants to nearly halve already reduced branch library hours to an average of 18 1/2 a week. He wants to actually halve recreation center hours to 20 a week. They’re both part of Sanders’ plan to close a $56.7 million gap and restore the rotating shutdowns of eight fire engines. The engines were a victim in the last round of budget cuts and intense criticism helped lead to their return.
Also in the mayor’s plan was $35.1 million in one-time solutions, such as delaying payments to reserves and vacuuming up unused cash from different funds. Those dollars won’t be available to fix next year’s problem. City finance officials pegged that gap at about $40 million.
This means that the person elected to save city finances, now going on six years in office, has one budget left to do it.
The extent of the city’s problems raises just as troubling a situation. Even if Sanders follows through on his pledge to end San Diego’s chronic deficits, the solution might be a city with branch libraries open only two weekdays and every other Saturday.
“That could be it,” Sanders said. “I can’t manufacture the money. All I can do is take what I have and prioritize it.”
This budget makes clear that recreation centers and libraries — the current building of a new $185 million central library aside — aren’t among his top priorities.
The situation is so bad that the city might have to consider turning them over to nonprofits, said former City Manager Jack McGrory.
Under Sanders’ plan, McGrory said, “you’re basically waving a white flag and saying we’re giving up on the operations of libraries and rec centers.”
Though not to such a large extent, that’s already happened with other services the city used to provide. Private donors have paid for fire pits on the city’s beaches, though they’re on the chopping block again. The city has scaled back on tree trimming and has had donors cover the costs of some lifeguard services, too.
McGrory didn’t blame the mayor for the libraries and recreation center problems. Sanders, a Republican, gave voters a chance to ward off some of these cuts with a tax increase, McGrory said. The voters said no.
Still, some decisions could have been different. Sanders and his advisors didn’t recognize the extent of the city’s troubles when they came into office, said Glen Sparrow, a professor emeritus at San Diego State University. Sparrow supported Sanders in his bid for mayor and served on his mayoral transition team, but has been more critical in recent years.
Solutions to major drags on the budget, such as existing workers’ pensions and retiree health care, either haven’t happened or won’t be finished in time to save money that’s needed now, he said.
“I think the long-term strategies are going to take too long,” Sparrow said. “And they waited too long to try them.”
Standing with the mayor Thursday were Council President Tony Young, and Councilmen Kevin Faulconer and Todd Gloria, a moderate Democrat, a moderate Republican and a more liberal Democrat, respectively. They all hailed the cooperation between the mayor and the council in putting together the budget.
Their words were similar to the mayor’s.
“We have not grown a lot of new money around here,” Gloria said.
The loudest alternative to the mayor comes from Councilman Carl DeMaio, a Republican who’s gunning for Sanders’ job. Last week, he praised the mayor for partnering with him on the 401(k) ballot measure. Since then, he’s antagonized Sanders on everything from the labor contracts Sanders recently negotiated to the mayor’s unwillingness to eliminate pensions for police in the 401(k) initiative.
Further, DeMaio said, any competitive bidding process wouldn’t take so long if he were in charge.
“If I were running the show, we would be able to do that in 60 days,” DeMaio said.
DeMaio even continues to tilt at what time and again courts have deemed windmills: pensions for existing retirees. He’s asked the City Attorney’s Office for a legal opinion recently on a different method to try to reduce those payments.
Meantime, Sanders maintains he’s done what he can. Tax revenues are coming back slowly. Wall Street investment returns and employee pay freezes are helping to reduce the annual pension payment. He’s putting six services through competitive bidding and seeking to privatize the city’s information technology department.
He’s cut nearly 1,700 positions out of the budget since he took office, and said the city now is below 10,000 employees for the first time anyone in his office can remember.
“I simply can’t produce money to provide services everywhere,” Sanders continued. “I just can only do what I can with what we have.”