Happy New
Year. I hope that you and your family had a wonderful holiday,
that it was a time of celebration with family and friends and that
the New Year has good things in store for you. Another year and a
fresh start.
In recent months,
the news each day in our fair City contains turmoil and much
commotion – from the Mayor’s race to finances, to investigations
to the pension mess and on and on. While serious to be sure, in
dealing with all of this, it is important that we see the forest
and not just the trees. We need to keep watch on the macro while
not being drawn in too much on the micro. There is much we can be
proud of in our City – and we should not ignore the many positive
things we enjoy. I’ll provide a brief overview of current events
and then provide a re-cap of the many good things we have in store
for 2005.
Priorities, Priorities
As we begin a new
year, I see four top priorities for City Hall in 2005. Until
these basics are handled, nothing really else matters.
Everything else is just extra noise. I will offer my perspective
on things here:
Priority #1:
Getting the City’s audited financial statements
completed.
Priority #2:
Resolving ongoing issues with the City’s Pension system and the
City's finances in general.
Priority #3:
Resolving conflicts in the City’s municipal code regarding
elections.
Priority #4:
Drafting policies, procedures and changes to the municipal code
and City Council policies to implement the 5-year “strong
Mayor/City Council” trial that goes into effect next January 1st.
The City has run out of
time. For 2005, the Mayor and City Council must make
some very tough and painful decisions. No more can San Diego live
beyond its means, paycheck to paycheck if you will. This is
the year things must change – or else.
The
City’s Finances
Without having
certified audited financial statements or “CAFRs” as they are
called, the City is dead in the water in keeping up with our
mandated and all-important water and sewer upgrades. In addition,
without audited books, the City cannot refinance various debts to
take advantage of lower rates (for example, the City could save
over $3 million a year on refinancing the ballpark bonds alone).
The reality is
this: investigations need to be completed before any audit firm
will certify any audit. KPMG, the City’s auditor would certainly
not issue an audit report while the FBI, SEC and who knows who
else is investigating things at City Hall. The big question is
when will all these investigations be completed – my guess is
we’ll be hearing about this story for the next several months
before the audited financials are finished.
The
Pension
I’ve written my
thoughts several times here in this space about the pension.
Today, I offer a few thoughts on how this can be solved and the
options facing the City.
The bottom line
to it all is the City must stay current with payments into the
retirement system and it must catch up on what it should have been
paying since it began underfunding the pension system in the
mid-1990s.
Key to all of
this is the need for abut $300 million per year to catch up and
stay current with the pension system. That’s a lot of money and
it cannot be done without the cooperation of our employees. The
alternatives are more draconian and I’d hate to see those played
out.
There are a
number of options that will be considered and suggested in the
coming months as we enter into new labor contracts with our
employees. A two-year wage freeze would save an estimated $60
million per year. In addition, the City could raise an additional
$35 million per year if employees would give up what’s known as
the retirement offset. Lastly, employees may be asked to forgo
higher retirement benefits promised in prior contract
negotiations. They could opt to keep the higher retirement
benefits, but would be asked to pay the difference into the
system. Certainly none of these ideas will prove very popular.
However, the alternatives are even worse. A court could rule to
reverse prior benefits if plaintiffs are successful in a proposed
lawsuit that would seek to invalidate labor agreements due to
alleged conflicts of interest. Lastly, our new City Attorney on
more than one occasion has suggested the City file Chapter 9
bankruptcy as a tool to invalidate the promises in labor contracts
and to reduce future pension expenses.
Suffice to say,
in the coming months, there are many difficult issues to be
considered. As I said, the City has run out of time. I will
continue to monitor things closely and keep you posted.
The
Mayor’s Race
The Mayor’s race
is over. It ended when the City Council certified the election.
Sure, not one candidate received more than 50% - and that is why
the municipal code needs to be corrected – no Mayor should govern
our City without at least 50% of the vote – just look at the
problems it is causing right now. However, the laws on the books
at the time were followed, the courts have ruled (several cases
are being appealed and new ones have been filed) and it’s time to
move on. It is fairly obvious that anything short of a new
Mayor’s election between only two candidates will produce a result
that folks can live with. If Donna Frye were to be Mayor, folks
have said they would recall her. The newspaper reports rumors of
a possible recall on Mayor Dick Murphy. The reality is simple:
It’s time to move on. Dick Murphy needs to jump in and show some
immediate and decisive leadership that he has a handle on things
and can guide the City out of this mess. The City Council can be
a partner in all of this – and it’s important we all work together
to get past this mess without any further delay.
As I've said, the
Mayor’s election is over. It’s time to move on. We need all our
collective efforts concentrating on solving far greater problems
confronting our City.
Strong
Mayor/ City Council
With one of the biggest changes
to hit City Hall in years, the voters decisively stated they want
their Mayor to be accountable in running the City – like folks
probably always thought he or she was. A five-year
“strong-Mayor/strong-Council” trial starts on January 1, 2006. I
say strong-Council as well as the City Council will also be
changing how it operates. With this new approach, all the
department heads – from parks to libraries to police and fire will
report to the Mayor. In the past, they have reported to the City
Manager who answered to the Mayor and City Council. In addition,
the Mayor will now draft and propose the City’s budget. The City
Council will act as the legislative body with the power to approve
or override legislative actions of the Mayor. The Council will
also appoint an Independent Budget Analyst to review and provide
budget information to the council, independent from the mayor and
it will choose new committees and elect a City Council president.
With such a fundamental change to
the way our City operates, many policies and procedures need to be
changed. Additionally, things like legal advice for the Mayor and
Council need to be considered – there is much that needs to be
done.
Another example centers on the
City’s budget. The City’s budget starts on July 1 and goes to
June 30th – so that means half of the budget the City Manager is
working on will become the responsibility of the Mayor in 2006.
The Mayor needs to be involved with the budget now and not just a
passive role.
I would also suggest a
citizens-based committee to provide insight to the Mayor and
Council as we move toward implementation of our new form of
government for San Diego. As a member of the Council’s Rules
committee, I’ll be closely involved with the implementation phase
and will keep you posted.
Beyond
the Top-Four
There are several
other key issues beyond this top-four list – and they among others
not mentioned here will stay high on the list of things to do.
Several of these other priorities include strengthening public
safety, better enforcement of our traffic laws and paying more
attention toward repairing our crumbling streets and sidewalks.
Our police and
fire departments are woefully underfunded and we need to be more
creative to bolster the funds we spend on public safety in our
City. One of the most logical approaches to improve public safety
without raising taxes is to dedicate a greater share of the City’s
future revenue growth toward police fire and lifeguards. I intend
to introduce amendments to the City’s public safety ordinance
later this Spring that will do just that.
Probably the most
frequent complaint I get from constituents centers on speeding and
reckless drivers. For whatever reason, a growing percentage of
the motoring public basically ignore many important traffic laws –
from speeding on our residential streets to blowing right through
stop signs and traffic lights. I intend to introduce a new
program later this year that will step up enforcement of speeders
on our residential streets and add more red light cameras to our
intersections.
With all the
recent rains, our streets are in greater need of pothole repair
and there are way too many raised and broken sidewalks throughout
the City. These need to be repaired now, not after someone trips
and falls. We need to fix potholes now – not after it’s too late
and we need a wheel alignment for our cars. The City folks tell
me the backlog is long and expensive. I will soon introduce a
plan to accelerate the repair of sidewalks and potholes over and
above current funding levels using some of the City’s share of
TransNet funds. Since TransNet passed last November, we should
use funds now and at lower interest costs to make the needed
repairs now, not later.
