Mayor Jerry Sanders announced Thursday that the city’s major financial problems are solved.
Sanders released the city’s Midyear Budget Report, which shows a surplus of $16.5 million more than expected for this fiscal year.
"We would not put out that we were out of this unless we had good projections that we feel very confident in, that we can get into the next five year outlook without a deficit and having to cut programs," Sanders said.
The surplus is, in part, due to revenues being higher than expected when Sanders first drafted the city’s budget. But much of it has to do with his administration’s money-saving reforms, he said.
This new financial optimism will allow for the restoration of funding for libraries, police, fire and park departments. City libraries will get four more operating hours per week. Recreation centers will be open for five additional hours per week. The police academy will get 15 more cadets to its next police academy. And the fire department will have a new fire station alert system, Sanders announced.
As good as the news is, Sanders can’t exactly say he solved the city’s financial problem, said UCSD Political Science Professor and Author Vladimir Kogan.
“Just as I don’t believe the mayor deserves much blame for the city’s financial problems, he certainly deserves minimal credit for allegedly fixing them,” Kogan said.
Sanders announced that his administration resolved the deficit by scaling back and streamlining services, and by laying off employees or cutting their pay.
Those reforms probably amount to less than $50 million: a drop in the bucket for a city with a $1 billion budget, Kogan said. He believes Sanders has failed to address two major problems facing the city: the underfunded pension liability and the city’s infrastructure.
The pension liability grew about $1.2 billion from the time Sanders took office until now, according to data from the San Diego City Employees’ Retirement System.
“The mayor has, in almost six years in office, done nothing to close the gap, even though this was the key issue he was elected to fix,” Kogan wrote in an email. A better idea would have been to freeze pensionable pay for the city’s highest earners, Kogan said.
The pension shortfall is at the forefront of discussions among next year’s mayoral candidates.
Candidate and City Councilman Carl DeMaio said he’s skeptical of the mayor’s claim that the budget crisis is over.
Another candidate and District Attorney Bonnie Dumanis released a statement following Sanders’ announcement voicing her support for the recovery.
"Keeping the momentum going will be key,” Dumanis said, referencing her education plan and a new “First 100 Days” plan released Thursday as well.
Candidate and Assemblyman Nathan Fletcher echoed the concern that the City’s job is not through.
“It’s time to turn the page and begin focusing on the future, not the past,” Fletcher stated.
Congressman and Candidate Bob Filner did not respond to requests for comment on Thursday’s announcement.
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