San Diego Faces Budget Cliff Without More Federal Aid
Friday, January 22, 2021
Photo by Milan Kovacevic
As the COVID-19 pandemic continues to choke the region's economy, San Diego city officials are preparing to cut funding for parks, libraries, arts organizations, public safety and infrastructure if the federal government does not provide additional aid.
Mayor Todd Gloria said earlier this month he is expecting a deficit in excess of $150 million. He has since directed department leaders to come up with cuts of between 2% and 8% as he prepares to present a balanced budget proposal by an April 15 deadline.
"Public safety departments including police and fire were asked to identify a 2% cut," city spokeswoman Racquel Vasquez said in an email Friday. "Departments that provide support to those public safety departments were asked to identify a 4% cut, including departments like human resources and information technology. All other departments, including parks and recreation and library, were asked to identify an 8% proposed reduction."
Former Mayor Kevin Faulconer was able to avoid such measures last summer with the help of nearly $250 million in federal aid included in the CARES Act passed by Congress and signed by former President Donald Trump. But that money will soon be exhausted.
President Joe Biden has proposed $350 billion in aid to state and local governments as part of a $1.9 trillion relief package. That would dwarf the $150 billion allocated to states and cities in the CARES Act.
But Republicans have thus far given a cool reception to Biden's plan. And while Democrats have a slim majority in both houses of Congress, it is not clear if they are willing or able to pass a version of the plan without bipartisan support.
Jeff Kawar, deputy director of the city's Independent Budget Analyst's Office, said even if Congress does approve more aid for cities, it's unclear how easily it can be applied to San Diego's deficit.
"How much will we be receiving in the city of San Diego, what are the restrictions on how those monies can be spent and what's the timeframe within which that money must be spent?" Kawar said.
City Council members this week began discussing their budget priorities for the coming fiscal year, which begins in July. A host of city programs received support from a majority of council members, including libraries, parks, arts and culture grants, homelessness services and street and repair. A majority also supported dipping into the city's reserves.
"We worked very hard to build that reserve over time," Kawar said. "So to dig into that would be something we would do only as a last resort."
Councilmember Chris Cate, the most senior member of the council and the city's last remaining Republican in elected office, cautioned his colleagues against asking for too much when resources are scarce.
"The budget projections are grim," Cate said at the Jan. 20 meeting of the council's budget committee, which he chairs. "As elected officials we must be honest enough to distinguish what truly are core city services, be strong enough to fight for them, and humble enough to delay the others until we have more favorable budget conditions."
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