DeMaio Unveils Budget-Balancing Plan

Skeptics question figures, motives behind "Roadmap to Recovery"

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    NEWSLETTERS

    A five-year strategy to turn San Diego's chronic municipal budget deficits into a surpluses was unveiled Friday by a leading opponent of Proposition D, the failed half-cent sales-tax hike on Tuesday's ballot.

    Under City Councilman Carl DeMaio's plan, most city employees would face pay cuts, pension rollbacks and the loss of retiree health-care benefits. DeMaio calls his strategy a Roadmap to Recovery and pointed out that it actually borrowed some principles from bankruptcy law without the delays, costs and stigma of filing for Chapter 9. Should his reforms hit roadblocks, DeMaio said, he has alternate routes to keep his measures on track.

    DeMaio Unveils Budget-Balancing Plan

    [DGO] DeMaio Unveils Budget-Balancing Plan
    City Councilman offers deficit-to-surplus budget strategy after defeat of Prop. D. (Published Friday, Nov 5, 2010)

    "If the mayor and council take a united stance, I do not anticipate that the labor negotiations will drag out," DeMaio told reporters at a City Hall news conference on Friday morning. "I do not anticipate that you will have as much resistance from the labor unions, because they will see the writing on the wall."

    DeMaio is urging a range of pension adjustments, the withdrawal of retiree health care and pay cuts of up to 8.5 percent for non-public safety employees, followed by a five-year salary freeze. He said that the eight fire engine companies that were "browned out" due to budget cuts will be restored under his plan, along with other public safety cuts.

    "The mayor and council have a choice," DeMaio said. "Make the tough decisions: Confront the labor unions or turn to your constituents and say, 'There was another alternative, but we chose to cut your services instead.' I find that not only unconscionable, I don't believe it will be sustained. I think the public has spoken very clearly, and if necessary, they will speak again."

    The plan includes outsourcing 11 different city services, such as the upkeep of Parks & Recreation facilities, vehicle maintenance and trash collection, as well as selling off the city's ground lease at the Miramar Landfill.

    The head of a labor-friendly, progressive think tank, however, doubts the wisdom of writing off city employees in favor of shipping out much of their work.

    "The record on privatization of public services is littered with cost overruns, failed services, services brought back in-house," said Donald Cohen, president and executive director of the Center on Policy Initiatives. "Here in San Diego County, that's happened. It's happened at the school board. It's happened in other states. It's happened in Texas."

    Cohen also questioned the figures behind DeMaio's plan -- and DeMaio's motives.

    "Carl comes in with cooked solutions, based on his narrow agenda," Cohen said. "He used to be a government contractor; he made a lot of money doing it. So his narrow agenda now is to sell off the city of San Diego to other contractors."

    DeMaio projects savings of $87 million by mid-2012 fiscal year, and $1billion over five years. He even proposes to pay out employee bonuses.

    For his part, Mayor Jerry Sanders said he will refer some of the ideas to a citizens' fiscal tax force. But, early signs are: Many won't fly with organized labor -- and may wind up in court challenges.