The city held its first budget meeting for the coming fiscal year on April 28. There was a small audience mostly made up of city staff and those who do business with the city. There were only four public speakers. Two, Marshall Weinrab of the Chamber and Steve Aceti of Coastal Coalition, had their hands out asking for more money. The other two, Sheila Cameron and Tony Kranz, made succinct comments about the lack of details in the staff report.
What’s going on? Well, the city is undergoing what it calls a “fiscal realignment plan.” That’s a smoke-and-mirrors term for budget cutting or spending reductions. They say the plan will save $778,000 and will be instead of across-the-board cuts. But cuts are cuts, and reductions are reductions, no matter how they are framed.
Here is the not so good news:
1. The budget will be reduced 9%.
2. Expenditure projections are reduced considerably.
3. No Tier One capital projects are reduced, but none are increased.
4. Rubenstein traffic calming is on hold.
6. Revenue projection is down because recovery is slower than anticipated.
6. No projected increase in sales tax revenue.
7. For property tax a 3% decrease in net taxable value over the last year (1st time in Prop.13 history).
Councilman Stocks was not present at this first budget meeting. He was in Mexico City with SANDAG on a mission dealing with border problems. ¡Olé! Both Councilmen Dan Dalager and James Bond spent a lot of time praising the staff for their outstanding work and justifying the lack of detail in the budget by saying they had spent hours conferring with City Manager Phil Cotton. The public doesn’t have this opportunity, so the public needs to be given details for transparency. For example, there is a technical paragraph in the staff report about changes in staff job classifications, but no explanation of what it means and its effect on the budget.
The elephant in the room that was scarcely mentioned is the financing of the Hall property park. The staff report simply says “No changes.” It is necessary to look in last year’s six-year plan to see that the city is not funding construction through fiscal year 2014-2015. Stocks and Dalager have been painting a rosy picture of the city’s economic status for several years now. They talk about a balanced budget and our high reserve fund. The contingency Reserve Fund is 20% of the operating budget and the Budget Stabilization Fund is 5% of the estimated revenues. This is a good place to be. but they fail to mention that this was accomplished by borrowing $45 million to buy the Hall property and finish the Library. And they never mention that they borrowed the money with Lease Revenue Bonds, so the cost is not counted as “debt” payment, but as a yearly “lease” payment. The money still has to come from somewhere in the budget, as the projects have no revenue stream. This is accounting doubletalk.
Councilwoman Houlihan talked about taking a conservative view, and Councilwoman Barth wanted more detail. This is a fuzzy picture at best. It all needs to be explained to the public better. After all, we pay the bills.