On Friday, Mayor Chuck Reed released his June Budget Message, which included his final recommendations for closing the City of San Jose’s $115 million budget deficit in the upcoming fiscal year and preliminary strategies designed to avoid further service cuts in 2012.
Most prominently, Mayor Reed’s budget message includes recommendations to keep San Jose’s 18 branch libraries open four days per week (the City Manager’s proposed budget included a reduction to three days per week), restore 49 firefighter positions via funds from the federal SAFER grant, rehire police officers from any increase in sales tax receipts and federal COPS grants, and restore park rangers, crossing guards, code enforcement officers and funding for senior wellness programs.
“San José’s dire fiscal situation leaves us with very few options,” Mayor Reed said. “However, preserving public safety must remain our first priority, and we must work to find ways to restore positions and services we’re losing. Additionally, we must preserve library services as they provide a safe place for our youth and a vital resource for residents seeking work during these tough times.”
The June Budget Message outlines the Mayor’s final recommendations to the City Manager’s Proposed Operating Budget, which closes a $115 million budget gap through a combination of one-time revenues, employee concessions, new service delivery models and efficiencies, and significant service reductions. Altogether, approximately 600 positions will be eliminated.
The cuts would have been even deeper if the City had not achieved a 10% reduction in total compensation from all city employees, including the City Council and executive management, which generated $39 million in General Fund savings. Friday, the city reached a tentative agreement with the San Jose Police Officers Association, which if ratified, will save the jobs of 156 police officers.
“I want to thank our entire workforce for giving up 10 percent in total compensation,” Reed said. “I realize that it is a significant sacrifice for our employees, but it has allowed us to save hundreds of jobs and critical services throughout the community.”
The mayor’s budget message also outlines strategies for avoiding even deeper cuts to core city services in the 2012-2013 fiscal year, during which the City is already projecting a $78 million general fund deficit. In addition to retirement reform, which the City Council will be discussing again on June 21, the Mayor’s proposal directs the City Manager to begin analyzing cost-saving opportunities that could be implemented in 2012, including:
• Selling real estate assets, such as Old Fire Station 1, the E Parking Lot at Old City Hall, and Rancho Del Pueblo golf course, and using additional one-time funding sources.
• Contracting out additional services, such as Real Estate, Park Maintenance, Accounting/Payroll, and Worker’s Compensation.
• Polling to explore the feasibility of taking potential revenue measures to the voters.
• Implementing other elements of the City Manager’s fiscal reform plan, including changing policies and practices related to the Supplemental Retiree Benefit Reserve payments, sick leave cash-outs, Workers Comp, vacation cash-outs, overtime, and retiree healthcare.
“As dire as this year’s cuts are, next year will be even worse if we do not take immediate action to get control of the rising costs of retirement and benefits,” Reed said.
Fiscal year 2011-2012 is the 10th straight year of general fund deficits experienced in San Jose. Approximately half of the upcoming year’s deficit was due to increased retirement costs, which will reach $250 million. By 2016, these costs are projected to reach $400 million and could jump to $650 million if actuarial assumptions are adjusted to reflect modern conditions.
Where was this good spirit last year? Also this doesn’t reach nearly deep enough. The city should put up ballot measures to free up about $100 million from capitol and special budget funds. The majority of those are only controlled by municipal code which we the voters can change. Very little of the money is restricted by prop 218. The mayor knows this but he isn’t doing enough. Maybe it’s time we taxpaying residents force the issue.
How typical that Chuck-O would overlook all of opportunities to shift Capital and Special fund monies to the General Fund.
We’ve been fed the line of BS for years now that changing revenue allocations is simply impossible. As it happens, hundreds of millions of dollars could be shifted to the General Fund via changes to municipal codes and the City Charter.
Chuck-O and his gang of thieves (Council, developers and perverted lobbyists) want to keep in excess of $2,000,000,000.00 (billion) locked up for pet projects, payola and graft, and obscene and mega-costly icons for their self-gratification and ego.
Truer words never spoken here.
Might as well bull doze the old PD building since you could care less about the officers that protect your city. The building is an embarrassment to the city it serves and while your at it sell the 92 million sub station that will never be opened. Hell, just pass on the law enforcement efforts to the county so you can spend more money on a ball park that will never pass a vote by pissed off SJ residents who can read a ballot.
““I want to thank our entire workforce for giving up 10 percent in total compensation,” Reed said.”
You took more than 12% from two of the unions. Karma.
Why is it that no one in city hall is talking about cutting ties with MACSA, the Mexican Heritage Plaza, selling Hayes Mansion or the Muni Golf Course? Why is it that none of them are discussing eliminating grants paid out of the general fund? Why is it…never mind.
Because they lack gonads?
The mayor forgot one item on his budget memo, “CLOSE THE AIRPORT.” It sucks up over a BILLION dollars a year. Close it for three years and payoff all the bills. The mayor wants to declare a fiscal emergency, well the airport is fiscal emergency.
What a waste! 80 flights that fly in and out, and most of the flights go Las Vegas and L.A. Two international flights that fly to Mexico.
The poor vendors inside the airport are starving! Pay them for there losses and call it even.
There’s an airport about 25 miles up highway 101 that is way better. And guess what, they have direct flights to where you want to go.
Unbelievable!
Reed/Figone legacy…..400 cops layed off
“Fiscal year 2011-2012 is the 10th straight year of general fund deficits experienced in San Jose. Approximately half of the upcoming year’s deficit was due to increased retirement costs, which will reach $250 million. By 2016, these costs are projected to reach $400 million and could jump to $650 million if actuarial assumptions are adjusted to reflect modern conditions. “
This is structured. The City decided to make the funds solvent within 5 years and thusly can exaggerate the costs because it’s not amortized over a longer period of time. The leaders of San Jose are not being honest in their exaggerated claims of pension problems. Yes, reform is needed- no it is not the cause of San Jose’s budget shortfalls… they spend too much on other things and now wish to blame it on their employee obligations.
Tuesday morning will begin the flood of NO VOTES and Reed/Figone’s wicked house of cards will come tumbling down. NO no y no.
I just want to know what kind of financing I will be able to get to save my house when I walk in to the bank and say I lost 10% pay , I lost my pension, I lowered my basepay when the abiter (sp?) took away my POST, Anti-Terrorist and holiday pay and what ever else s/he chooses to take. But gosh darn it, I still have a job and my Dignity!!!!
Can I get a “Hell YA” for my dignity!
d-I-g-n-I-t-y , most impo’tant thang is the “I”!!! sock it to me , sock it to me, sock it to me, sock it to me !!!
or- Walking my beat in hot sun, I fought the mayor and the mayor won! Lost my cruiser in ar-bi-tra-tion! I fought the mayor and the mayor won!
Got holes in my boots and blisters on my feet,cause I fought the mayor and mayor won! lost the uniform allowance and my medical too 256 of our family lost all that and more, cause I fought the Mayor and the Mayor Won, I got my dignity when Chuck Reed won.
Should have voted yes and took a 10% hit, took the chance the aribiter might award a 1 year limit but i fought the mayor and the mayor won.
Let’s play poker, I’ll bluff you all night long. Go ahead and vote yes, I’ll have my dignity and Reed will have your @$$ and be laughing over a cigar and beer.
You are REALLY showing your age. SOCK IT TO ME??????
You think the mayor won? Is that why he is now back pedaling? SOMEBODY has finally got it through his head that what he was trying to do is illegal. That is why he has directed his staff to go back to the bargaining table on the reform. It has to be negotiated to be legal. What he would have taken to the ballot would have been illegal and what the voters would have been voting on would have been illegal. D’oh! Imagine the voter’s surprise when handed THAT tax bill for all those millions in legal fees. Evidently, you don’t research facts much. Just “talk” out of that pie hole without thinking.
Correction: The Airport doesn’t suck up a single dollar from the City. It is an “Enterprise Fund” which means we must fund on-going operations only with the revenues we generate. We not only cost the City nothing, the City actually makes a little off of us by something called “Employee Overhead”. The Airport has to pay the City 40% of the base pay of each Airport employee. Yes, the Airport is struggling and in order to meet our debt obligations, one measure has been laying off 200 (half) Airport employees in the last two years. If you’re going to rant, at least know what you are talking about.
Ross,
I’m fairly certain that when we spend gazillions on refurbishment, new terminals, etc., the Capital or Special budget accounts are tapped.
An expense like that is money down the toilet and future tax revenue could better be redirected to the General Fund, but our politicians lie to us, saying that it can’t be done.
Mayor Chuck-O is currently building a war chest for the A’s stadium, which will never be built. He and our Council Members will soon be challenged by taxpayers to modify the City Charter and Municipal Code to provide for redirection of payola and graft reserves to the General Fund. Our crack City Attorney will be unable to stop this challenge.
I wish you well SJ, report all your crimes on 411, the mayor could care less about your safety. It’s all about his next political move. And Pete Constant you are even worse, taking your PD disability retirement that should have never been granted.
Good bye safe city, welcome to Oakland. How many homicides so far this year? Oh, forgot the mayor cut the gang unit, Air Support, limited detective units (including homicide), sexual assaults, Megan’s law, and burglary unit is non excitant. Merge unit (SWAT) is useless due to lack of officers. Airport police soon to be taken over by Sheriff. Oh, and the 92K sub station will remain empty for even due to lack of officers.
Thank you city council.