Small Cities Are Doing Just Fine, Thank You

The City of San Diego’s well-publicized budget struggles include pay cuts and fee hikes. But even cuts and hikes aren’t enough to quell Mayor Jerry Sanders’ worry, anger and frustration at Governor Arnold Schwarzenegger’s intention to borrow $2 billion from local governments.

So I assumed that other cities in San Diego County would also be worrying at the prospect of state legislators shoveling property taxes from small municipalities into California’s coffers. After all, fewer city dollars mean fewer city services and smaller staffs to serve local residents.

Since I hadn’t read or heard much about responses from other San Diego mayors to the budget crisis that was exercising Mayor Sanders, I made some phone calls this week to speak directly with the mayors of Del Mar, Carlsbad, National City and La Mesa.

Del Mar intrigued me because it’s San Diego’s smallest city, with just 4,500 residents and two square-miles. La Mesa and National City are close in population and size (approx. 60,000 people and nine square-miles) -- about the middle of the pack of 18 cities in people and land mass. Carlsbad is on the high-end with 101,000 living there in 42 square-miles.

I asked each of the mayors how they're dealing with the budget crisis, expecting to hear some whining and perhaps some expletives. But that really isn’t what I heard. All four mayors were aware of the fiscal challenge, but relatively comfortable that their cities were in pretty good shape, because they had all been proactively preparing for some economic downturn.

Here are some examples:

La Mesa Mayor Art Madrid said they had seen the handwriting on the wall two years ago, had 55 public meetings, saw there was no fat to cut or belt to tighten and they passed a ¾ of a 1 cent sales tax. The primary source for their revenue now is the sales tax.

National City Mayor Ron Morrison said instead of increasing salaries and retirements, the city pays bonuses and has been doing that for years (they are currently in negotiations with police officers, and next year with the fire department). A 1 percent sales tax increase was passed by the voters in 2006 and survived a ballot measure to repeal it in 2008. The mayor said that National City’s Plaza Bonita “is going gangbusters and you can’t find parking.”

Del Mar Mayor Crystal Crawford is pleased with her city’s recently completed budget workshop that resulted in a balanced two-year budget with no cuts in services. There’s no hiring, no raises, and only two of 50 city positions that were vacant were eliminated. She attributes this apparently stable situation to taking apart every city operation, looking at every way departments are doing business, and putting them back together again to “make the city lean and mean.”

Carlsbad Mayor Bud Lewis said it’s his city’s diversified revenues that have helped, especially the transient occupancy tax from 4,000 visitor rooms. Although the revenues are lower, the TOT still brings in about $9 million. The city has reduced the budget twice already and has a good reserve of $46 million to be used only for real emergencies, not for wages. There are no plans to cut services or lay off personnel, but building additional facilities now, such as parks or swimming complexes, will be delayed.

Nevertheless, all four mayors were clearly angry with the legislators in Sacramento. Mayor Lewis doesn’t blame the Governor or his predecessor, Gray Davis. He points to the legislators sending pork back to their districts and spending reserves.

Art Madrid believes the hard partisan line preventing the lawmakers from working in behalf of the people is akin to a jihad.

One of Ron Morrison’s complaints is that the state requires cities to have a balanced budget by June 30th or have their funds cut off, while the state legislature can delay approving a budget indefinitely.

But it's Crystal Crawford who is putting her anger into action. Two weeks ago, she declared her candidacy for the California Assembly and will run against Republican Assemblyman Martin Garrick in the 74th District. Mayor Crawford is a Democrat in a district with a 42 percent Republican voter registration to 31 percent Democrats. Yet the district supported Barack Obama last year and the budget mess might motivate voters to look for change – any change.

Meanwhile, there’s little action in Sacramento. San Diego’s pay cuts and fee increases are in place, and more needs to be done to fill its budget gap. And Del Mar, Carlsbad, National City, and La Mesa appear to be doing just fine.