San Diego IBA Discusses Budget Recommendations

We've heard about the mayor's budget proposal, and the council's budget recommendations. Now, it's time for San Diego's Independent Budget Analyst to weigh in. How does the city's IBA, Andrea Tevlin, think the mayor and council should eliminate the $57 million deficit?

Guest

Andrea Tevlin, Independent Budget Analyst for the City of San Diego

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CAVANAUGH: I'm Maureen Cavanaugh and you're listening to These Days on KPBS. When it comes to the 2012 budget for the City of San Diego, it seems everybody wants to get into the act. Not only do we have the traditional billion proposed by Miss, we also have a budget package proposed by the San Diego City Council, along with a few extra suggestions by individual counsel members. And so the people charged with actually crunching the numbers to see if these proposals add up, have a very big job this year. Want office on the independent budget analyst has just released a review of next year's budget proposal, and I'd like to welcome my guest, Andrea Tevlin is independent budget analyst for the City of San Diego. Andrea, good morning.

TEVLIN: Good morning. Maureen.

CAVANAUGH: What's the purpose of making this analysis? How is it used?

TEVLIN: Well, when the strong mayor form of government was put into place, our office, independent budget analysis, created as an effective local resource for the city council, and really the community at large. And separate review of the mayor's budget given that the mayor is developing the budget with his staff and it gets passed couldn't the council. The council needs a resource to say does this make sense or should we do this or should we do that? Or does the revenues make sense? Can you review the revenues and come up with some areas that you disagree or areas that you agree with the mayor?

CAVANAUGH: So basically you're the arbiter in the sense that you actually do the arithmetic, the calculations to see if what people say is possible, actually is in terms of actual hard numbers?

TEVLIN: Yes, that as well as looking at community issues. You know, where community needs are and developing possible proposals for meeting those needs or options, for instance, for restoring library hours so much it's more than just numbers, it's really looking at the policy behind it and programs and services.

CAVANAUGH: Can you explain, Andrea, the process the City Council is going through this week?

TEVLIN: Sure. The council is holding various hearings all day yesterday, all day today, all day Friday, and then Monday evening as well. I really encourage people to come down on Monday evening here at city hall. And next week also. And the Council is reviewing every single city department. The hearings start out with our presentation for about an hour and a half yesterday where we reviewed the mayor's entire budget, everything from his expenditures and revenues assumptions to his performance measures and departmental issues and other big issues in terms of fire brown outs issue etc. So what they are doing now, individually, department by department, they are going through every single department's budget, asking issues that we have raised, asking issues that they have to try and get a better handle. Is the mayor's budget is the right budget?

CAVANAUGH: Right now, can you tell us what some of the major points of the mayor's budget are? First of all he's proposing to eliminate the city's $57 million budget deficit largely through cuts. What are the biggest cuts he's proposing?

TEVLIN: Well, the biggest cuts in terms of service reductions are cutting both the branch library hours by 50 percent, it's every branch library, and then other recreation center hours by 50 percent. There are also reductions to swimming pool programs and other after school programs and some other park and recreation programs of those are the major service reductions. He is also increasing some user fees in the fire area. So for a firealarm permit, you would pay for that this year, and you would pay for if your alarm went off, and if it was a false alarm. So there are some fees such as that. He's also used -- which is always a sort of a source of controversy, a wide range of what they call one times, which are only good for one year, such as transferring a fund balance into the general fund from another fund. And he's used about half one times, and half ongoing. The ongoing cuts are those that are permanently removed from the billion. That would be the library cuts and positions of the one times are things that you could only use it once of it's just a one time pot of money that was found, and he's used about half and half, and that's controversial as well.

MAUREEN CAVANAUGH: And it's controversial because a one time budget -- one time cut like that doesn't do anything to help our structural deficit; is that right?

TEVLIN: That's exactly right. But he has been forthright about that. He has, you know, he's had -- I've used $35 million of one time solutions, you about I understand that I am carrying over the problem to the next year for my final year, and I will fix the problem next year. So it's a trust kind of thing. But he has been forthright about it, and we certainly can't find solutions enough -- $35 million worth to replace all of that. So that -- most of that probably will stay in tact. But what we are trying to do is identify solutions for some of the bigger community concerns and possible ways to restore parks and recreation center programs and library hours.

CAVANAUGH: I'm speaking with Andrea Tevlin, she's independent budget analyst for the City of San Diego. That office has just released its analysis of the mayor's 2012 billion, and also an analysis of some suggestions made by the San Diego City Council. Let me get back to you one of the major community issues that you were talking about, and one of the major announcements from the mayor recently was his plan to restore the eight browned out fire stations. Where will that revenue come from, Andrea?

TEVLIN: That revenue came from the other reductions. Basically when he made a decision to restore all eight engines, he looked to other service cuts. And those service cuts are the library hours and the recreation center hours I've been talking about. That is primarily what helped to restore the brown out. We have put an option on the table to perhaps restore the engines over a two-year period rather than one, which would free up resources. I'm not saying that that's what the council is going to go with, but it just shows you the trade off that is the balance of issues that is before us right now.

MAUREEN CAVANAUGH: Just yesterday on this program, we were talking about councilman Todd Gloria's proposal to ameliorate some of these really deep cuts that are proposed for libraries and rec centers in the City of San Diego. She says that $15 million can be found by tapping into increased revenues and making cuts in other areas. What do you think of that proposal?

TEVLIN: I think he was referring to our report.

CAVANAUGH: Uh-huh.

TEVLIN: We have reviewed the revenues that the mayor's put forward, the revenue estimates, and we are quite confident that can be adjusted upward, and they have been overly conservative this time around. And not by a lot. We're very cautious people ourselves. But we do think with the economy and the growth that we've seen this year, we can boost that several million dollars. We have proposed some other reductions, not to services, but more to line items within various departments, training and over time, things like that we feel could be cut back just a little bit more just to free up some funding for restoring -- if the council wants to consider restoration of the library hours and recreation center hours. So we agree with his list. We are not saying that all of these options are -- we still need to research these. You know, these are options, these are not [CHECK AUDIO] recommendations at this point. And there are some issues as the mayor's office comes back and responds to these, they may raise some issues that we weren't aware of. So even's still listening right now, but I do feel confident that he we come up with some resources. The level of which, you know, I can't exactly land on at this point.

CAVANAUGH: Right. Talk to us a little bit if you would, Andrea, about the city's revenues. Your report indicates they are going up. Give us a sense of how much they fell off in recent years, in terms of year to year.

TEVLIN: Oh, they have fallen off substantially to where you used to see growth in the sixth and seventh and 8 percent, it's gone down to 0 in the last several years, negative growth even with property tax accident even this year, we're projecting no growth to property taxes due to the reassessments and the over all really estate market which is pretty stagnant of it's been millions and millions and millions of dollars of losses since 2008, and we're just now beginning to see a lot bit of growth in the sales tax and transient occupancy tax, which is the hotel tax. So things are starting to turn around. We still have a very conservative growth that we are even project accident, even if we increase it about four percent, which is way below the years you used to know in San Diego, before the 2008 situation.

CAVANAUGH: Right.

TEVLIN: So it's been very difficult for even across the country to live with and to continue to provide these critical services.

CAVANAUGH: Now, as I said, there's a projected budget deficit of $57 million next year, in the 2012 budget.

TEVLIN: Right.

MAUREEN CAVANAUGH: What are we looking at when we look further out like to 2013 and 2014? Does that deficit begin to shrink?

TEVLIN: It does, it shrinks to about $9-million in 2016. That, assuming we keep doing the right things. So it does begin to shrink as the economy starts to pick up, and as some of the reforms that have been put into place like the retiree health -- retiree pension program that we put in a couple of years ago. Of course there's a new item that will probably be on the ballot next year with regard to our pension program too, but as some of these reforms kick into place and start showing results issue that's helping the budget as well. So we do expect the deficit to come down, but we have to keep making the right decisions and continue with the reforms, continue with the structural improvements to the budget.

MAUREEN CAVANAUGH: In fact, there's a big caveat in the independent budget office analysis just released about what will happen if the present talks about retiree healthcare costs break off.

TEVLIN: Yes.

CAVANAUGH: Tell us about that.

TEVLIN: Yes. If we don't accomplish retiree healthcare reform, we could be faced with another $40 million payment for next year. I have to explain that though. That is what it would take to pay what is called the annual required contribution for retiree healthcare. We are not legally obligated to pay that. But we should be paying it. Put it that way. And right now if we do not reform retiree healthcare to a specific level, we could be faced with -- at least we should be paying another $40 million.

CAVANAUGH: Besides the alternatives that you've offered to the council about the brownouts as opposed to the cuts in libraries and rec centers, what are the other main recommendations, budget recommendations you made before the City Council yesterday?

TEVLIN: We made 20 some options, or we proposed 20 some option for either increasing resources or further reductions to the budget. And then we also provided options for -- three different options for restoring library hours, an option for restoring recreation center hours. We also made a recommendation for the option of providing the fire indication alerting system. That alerting system has failed and that's a one time piece of equipment we really need. We also made recommendations just with respect to some of the issues about how the budget is presented to the public. We made recommendations for improvements to that. We recommended that the performance measures be improved, and that we have a more comprehensive process for the council to review our user fees, and whether we're recovering the costs. So there's a wide, wide range of recommendations.

CAVANAUGH: Now, if people want to take a look at your report for themselves, how can they do that?

TEVLIN: Just go into the City of San Diego website, and in the upper right-hand side, they'll see independent budget analyst. Just click on independent budget analyst and our report will be right there. It's our latest report, so it should be right on the front of our web page. And I really encourage people that are interested in the budget to read it. I mean, I know it's hard to read budget material. But what we really try to do in our office is make the budget -- take the mayor's budget and put it in terms that everyone can understand. And not all of it will be simple, but it's still a very professional report. But we try and really take that document and just weed through the issues and lay it out more clearly.

CAVANAUGH: And there are lots of graphs and lists, and for a budget analysis, it's not that dense.

TEVLIN: Yeah. Thank you. We try hard to do that.

CAVANAUGH: Andrea, thank so much.

TEVLIN: Okay. Thank you Maureen.

CAVANAUGH: Andrea Tevlin is independent budget analyst for the City of San Diego. If you would like to comment, please go on-line, KPBS.org/These Days. Coming up, human restoration through the nature principle. That's next as These Days continues here on KPBS.