Spying a years-long stretch of budget shortfalls on the horizon, Mayor Sam Liccardo has urged his colleagues to “tap the brakes” on city spending.
In his second March budget proposal as mayor, Liccardo tells the city to set aside next year’s $5.7 million surplus for future deficits.
“Given the economic and fiscal landscape, now is not the time for new programs requiring ongoing spending commitments,” Liccardo said. “Until our future fiscal condition is clearer, we need to tap the brakes on spending and continue tightening our belts.”
After a small surplus in the fiscal year starting this summer, the city expects a cumulative $36 million shortfall over the following four years. That doesn’t account for a $1.1 billion backlog of street maintenance.
“Moreover, while the budget office forecast anticipates an economic slowdown, a more significant—and seemingly inevitable—recession would reduce revenues far more sharply,” Liccardo cautioned.
Unfortunately, the long-term forecast looks pretty grim. San Jose, he said, should take advantage of this modest recovery to bolster against another recession.
“The city’s revenues appear highly sensitive to larger economic forces,” Liccardo wrote. “[T]he horizon reveals economic threats that have rattled equity markets, cooled venture capital investment in local tech companies, exposed weakness in China, and mired key global markets—from Europe to Brazil to Japan—in protracted slumps.”
Still, the message proposes one-time funding to ramp up recruiting for San Jose’s depleted police force. It also calls for new software for the fire department to slash 9-1-1 response times.
“Improving public safety remains our highest spending priority, and this budget message will allow us to continue to make progress on that critical goal,” Liccardo said. “However, restoring core city services to the levels our residents expect and deserve will require us to grow revenues.”
Despite shortfalls ahead, the mayor wants the city to spend what it can this next year to curb homelessness, blight and gang violence. He’s also eyeing a set-aside for a Vietnamese community center and some $4 million in state funding for local water fluoridation.
If residents want to add services, they can vote on a way to fund them this summer. A quarter-cent sales tax up on the June ballot would rake in about $40 million a year.
“Otherwise,” Liccardo said, “we should continue to tighten our belts, and to fasten our belts, for an uncertain future.”
The mayor’s message marks the first step in the city’s 2016-17 budget planning. The City Council will hold a public hearing on the proposal next week. Meanwhile, City Manager Norberto Dueñas will drum up a plan of his own for the council’s consideration.
To read the mayor’s 23-page message, click here. To view the city manager’s draft plan, click here.
> That doesn’t account for a $1.1 billion backlog of street maintenance.
But we’ve got lots of modern, spiffy playground equipment in our parks.
And bike lanes with splendid green paint.
You’ve got to have your priorities.
SJOTB,
The paltry creative bookkeeping “surplus” exists once deferred maintenance and other predictable costs are set aside. Notice Liccardo conveniently neglects to mention the millions in additional revenue opportunity identified by the City Auditor or potential savings she’s previously identified.
A Vietnamese Community center is a “core service”? If so, the African American one on Julian or the DeFrank LGBT one on the Alameda might be repurposed. Like the Mexican Heritage center, both are limping from lack of community support.
Hedding street has turned into a commute nightmare after bike lanes replaced two vehicular travel lanes. The funding justification was air pollution reduction. In practice, more pollution is generated from congestion using SJ’s Hedding traffic data.
> the DeFrank LGBT one on the Alameda
How much city funding does this suck out of taxpayer wallets?
Whatever happened to the former executive director of the DeFrank center who was getting paid $225 K (plus or minus)?
Don’t know precise figure. $225K / year seems too high. Believe it was closer to $125K. SJ bought the former dance studio, paid for building and parking lot renovation, then leased it back to DeFrank for $1.00 / year on a 50 year lease.
Opponents to funding SCC County Office of Women’s Policy https://www.sccgov.org/sites/owp/Pages/owp.aspx (all female 5 full time employees), the newly minted County Office of LGBTQ Affairs (staffing not yet published), etc. are branded as anti-women, homophobic, or racist.
Never mind that the Human Relations Commission and similar overlap and do not burden taxpayers. Government agencies like OWP & LGBTQ Affairs produce no tangible benefit and sap scarce resources.
> Don’t know precise figure. $225K / year seems too high. Believe it was closer to $125K.
Unfortunately, I can’t recall the woman’s name. She posted a few articles on SJI, and then someone posted the IRS statement from DeFrank Center which disclosed her compensation. It was in the $225K range.
Mysteriously, she seems to have been flushed down the memory hole and her articles no longer seem to be searchable in the SJI archive.
Just speculating, but DeFrank webpages suggest that it underwent some sort of financial crisis/reorganization.
Maybe I have sensitive nose, but I discern a hint of (financial) scandal.
If anyone knows more, dish!
>County Office of Women’s Policy
> About the Office of Women’s Policy
> Developed in the spirit of collaboration between the County and the community in 1998, the Office of Women’s Policy is a leading voice in Silicon Valley on the needs of women and girls, serving as a catalyst for awareness and action on current and emerging issues that impact women’s health, safety and security. Through analysis, research and strategic collaboration, OWP works to ensure that programs and services, and also systems and policy support women’s leadership, full equality and advancement in the home, at work and in the community.
————————-
A divisive government entity that CLEARLY only serves half of the population,
The charter of government is to serve ALL citizens equitably and without bias,
The County Office of Women’s Policy needs to be reformed as the County Office of Men’s and Women’s Policy, and then abolished, because ALL of the policies of the county government should serve men and women equally.
>“Given the economic and fiscal landscape, now is not the time for new programs requiring ongoing spending commitments,” Liccardo said. “Until our future fiscal condition is clearer, we need to tap the brakes on spending and continue tightening our belts.”
>He’s also eyeing a set-aside for a Vietnamese community center
Sam Liccardo runs on a platform of rebuilding SJ’s police department through fiscal responsibility. Now SJ still doesn’t have a functioning police department, but Liccardo wants to spend millions to build a Vietnamese community center at the same time that he says it’s not the time for new spending? Mayor Liccardo has become a disgrace, he is not the person I thought I voted for.
Liccardo has embraced voodoo economics. He claims a $5.7M “surplus”, but conveniently omit $1.1B+ in deferred transportation costs, millions in deferred pension obligations, the recent $3.7M Plaza homeless housing and it’s $600,000 annual operating cost. And much, much, more.
But no worries, the 1/4 cent sales tax hike will solve SJ’s woes. Baffling how the estimated $34M revenue hike has morphed into $40M in the last 2 years while inflation has been negligible.
SJPD claimed an additional $20M / year would solve our public safety crisis…but not clear that was or will be the case. Nothing but speculation (no survey or other data to support the claim).
No response or action on cost savings identified by the City Auditor and various citizens groups.
> Baffling how the estimated $34M revenue hike has morphed into $40M in the last 2 years while inflation has been negligible.
A question for the rocket surgeons in the audience (Frank Mockery may go to the head of the line):
If California raises the minimum wage from $10 per hour to $15 per hour, will inflation continue to be “negligible”?
This is why citizens need to take the upcoming city council election seriously, and pick candidates that really understand the financial big picture.