San Diego

Mayor Unveils ‘Lean' Budget Plan to Cover Pension Costs

San Diegans will keep seeing more government spending on streets, neighborhoods and services.

But some cuts are figuring in to the city's next budget, which takes effect July 1.

While it's not really a gloom-and-doom proposal – Mayor Kevin Faulconer called the $3.6 billion spending plan “lean” -- funding for the arts is being scaled back, along with the size of the workforce.

Faulconer is dipping into some reserves because pension costs are still spiking and could for another decade or so.

A continuing budget priority is upgrading San Diego's decaying streets and other so-called "infrastructure" items.

After a rainy winter season, tens of thousands of potholes and cracks are due for treatment under a five-year, thousand-mile repair program that's pretty much on schedule.

Spending on personnel is being trimmed by the elimination of 60 budget positions (out of about 9,000).

That doesn't mean actual job layoffs, because some of the positions already are vacant.

Past projections for pension costs were about 20 percent lower than the real bottom line, so that's why reserves are being tapped.

“We're not going to go back and under-fund those reserves,” Faulconer told reporters following a noon-hour news conference in Valencia Park, pointing to pension-fund decisions made by previous City Councils.

“We used some money from the Pension Stability Reserve just for that, when you see that growth in the pensions,” explained. “There's no doubt that the deliberate under-funding and mismanagement, the mistakes of the city's pension are things we're still dealing with. That is the reality."

Faulconer cited upward economic indicators for key revenues from property, sales and hotel room taxes.

“That's a strong economy, and part of what I do as mayor -- is to keep that going,” Faulconer said. “We're proud of that."

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