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Mayor Sanders Issues Final Budget Proposal

Evening Edition

Above: City Councilman David Alvarez talks to KPBS about Mayor Jerry Sanders' budget announcement and turmoil at the Convention Center.

Aired 4/11/12 on KPBS Midday Edition.

Guests

David Alvarez, San Diego City Councilmember for District 8.

Donna Frye former San Diego City Councilwoman.

Transcript

Mayor Jerry Sanders issued his final budget proposal today and said it includes a projected $119 million in surplus funds over the next five years.

Mayor Jerry Sanders unveils his final budget proposal on April 11, 2012.
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Above: Mayor Jerry Sanders unveils his final budget proposal on April 11, 2012.

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Mayor Sanders' Budget Fact Sheet

Mayor Sanders' Budget Fact Sheet

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The fiscal year 2013 budget proposal will be the "first truly-balanced one in a very long time,'' according to the mayor's office.

Sanders, who is leaving office in December after two terms, said in February that he expected to end the current fiscal year on June 30 with a surplus of around $16.5 million. According to numbers released today, the projected surplus for fiscal year 2013 will be $0, increasing to $2 million in fiscal year 2014, $11 million in fiscal year 2015, $39 million in fiscal year 2016 and $67 million in fiscal year 2017.

Those numbers total $119 million in the next five years.

“We don’t have a deficit today," Sanders said at a press conference. "Instead we have projected surpluses for the foreseeable future. All told, we’ll leave for the next mayor a combined surplus of $119 million for the next five years. That’s money that can be used for more library hours and to hire more police officers and firefighters.”

On KPBS Midday Edition, City Councilman David Alvarez said while it's good news the city has more money to "keep on pace" with spending this year, "that doesn't mean that this year has been the best year."

"We've had to sacrifice a lot as San Diegans, and so we need to keep making sure we spend in ways that aren't inappropriate, and that we stay in line and continue to restrain ourselves, because it's not the end of this crisis," he said.

Former City Councilwoman Donna Frye told KPBS Midday Edition that services the city provides now are nowhere close to those provided 10 years ago. She said because there is no way to compare current service levels to those before Sanders took office, it is difficult to say the budget is truly balanced.

"One of the things that the mayor did when we shifted to a strong mayor and he started taking over the budget is that there were no measurements provided to the council and certainly not to the public as to what the current service levels are," she said. "So if you eliminate most of the public services, and then say now we’ve balanced the budget and there’s no deficit, I would say, compared to what?”

Frye later wrote in a Voice of San Diego commentary that the mayor's budget projection contradicts the city's statement that it does not have enough money to pay off 1998 Convention Center Phase II Expansion bonds. This inability to pay allowed the city "to include the $226 million Convention Center agreement as part of the obligation schedule that was being sent to the San Diego County Auditor-Controller," Frye wrote.

"So, I am wondering: Which representation of the city’s finances is true?" she wrote. "Is the city too broke to pay the debt service on its existing 1998 Convention Center bonds, or have things changed so dramatically that those payments can now easily be made from the city’s general fund as they were from 1998 to 2010?"

The mayor’s proposed spending plan includes funding to continue service restorations he announced in February, such as adding five more operating hours at each of the city’s 35 branch libraries and 55 recreation centers.

Sanders said he achieved a balanced budget "through a combination of money-saving reforms such as managed completion, reductions in personnel and a modest recovery of tax revenue."

“We could have continued to put off our day of reckoning to another time, for another mayor or another council to handle, but we didn’t,” he said.

Sanders also said he would continue improvement projects, including repaving 172 miles of road.

“Given that the city resurfaced only seven miles of road in the year before I took office, I think we can safely say we are miles ahead from where we once were,” he said.

His Capitol Improvement Project streamlining plan also includes infrastructure projects like street resurfacing and storm drain replacement and cuts between three and 12 months off project time, Sanders said.

The budget also includes funding to increase the city’s reserve levels to 11 percent. Levels were at 2 percent in 2005.

This is the city’s first paperless budget, which will save the city approximately $25,000, according to Sanders. The budget will be available on CD and on the city’s website.

In response to Sanders' announcement, City Councilman and mayoral candidate Carl DeMaio released a fiscal assessment of the proposed FY 2013 budget that he said shows the city will run an operating deficit of at least $50 million. When accounting for lost services, the city is $318 million short, he said.

“Once again the city’s budget is not really balanced this year – and we face at least a $50 million shortfall," DeMaio said in his statement. "Taxpayers deserve a budget that is balanced for real. A decade ago city leaders balanced their budgets on paper by skipping pension payments; today city leaders are skipping payments for basic road repairs and maintenance.”

At his press conference, Sanders responded saying "there are some people who are running for mayor and their entire platform has been doom and gloom."

Sanders said "that councilmember" has had problems with correct numbers in the past, and "that doesn't help his candidacy."

"So I stand by these numbers," Sanders continued. "I've never been afraid to tell you bad news. I've never been afraid to tell San Diegans bad news."

State Assemblyman Nathan Fletcher, also running for mayor, said in a statement "the reaction to the mayor's budget today demonstrates the clear choice voters have in this election."

"Do you want a mayor who is going to seek to find a perpetual state of crisis?" he said. "Someone who thrives on conflict and divisiveness, someone who believes in preserving problems to campaign on, or do you want a mayor with a forward looking vision to rebuild the city moving forward."

A third mayoral candidate, District Attorney Bonnie Dumanis, also issued a statement saying "San Diego faces major financial challenges in the years ahead and it will take a steady hand at the helm to keep us on track."

"Our city has roads that need to be repaved, sewer pipes to be repaired and replaced, and hundreds of millions of dollars in deferred maintenance needs that have been put off for years," she said. "We need to build on what has been accomplished and continue to get our financial house in order. San Diegans have to live within their means, so should City Hall. We also need to pass, and then implement comprehensive pension reform to maximize savings to the taxpayer."

Congressman Bob Filner, the only Democrat running for mayor, did not respond to requests for comment.

Sanders is scheduled to formally introduce his plans to the City Council next Monday and hold a public hearing on May 14. The council's Budget Committee is scheduled to begin reviewing the proposal on May 2.

City News Service contributed to this report.

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