Sanders: San Diego on road to fiscal recovery

Mayor Jerry Sanders
Mayor Jerry Sanders

By Elizabeth Marie Himchak

Eliminating the city’s structural deficit, making San Diego business friendly, expanding San Diego Convention Center and resolving the Chargers’ stadium situation are what Mayor Jerry Sanders told Rancho Bernardans he plans to focus on during his last 18 months in office.

“We’ve been making up ground in the last five years (on the budget deficit),” Sanders said. “It has been a community effort.

“We’ve received tremendous support from you in everything we’ve done,” he added. “I have 18 months left and we’ve still got a ways to go in closing that gap.”

Sanders spoke on Tuesday to about 150 at a combined Conservative Order for Good Government and Rancho Bernardo Business Association luncheon at the Country Club of Rancho Bernardo.

According to Sanders, San Diego is ahead of many other major cities — such as San Jose — in getting out of its financial difficulties.

“We’re moving out (of this) while other cities ... throughout the U.S. (are entering),” he said. “It is fortunate we went into it first, even though it was very painful.”

He also said the national recession has helped San Diego in its recovery because “it forced everybody to be more reasonable and rethink the way we were doing things. It started to turn the conversation.”

He highlighted recent successes, including passage of a city budget last week that while including cuts, were not as severe as first projected. One is the restoration of all eight “browned out” fire stations starting July 1, instead of in two phases six months apart.

“This is excellent news for Rancho Bernardo,” Sanders said.

He also said city tax revenues are starting to rise, transient occupancy tax “is up quite dramatically” and “sales tax is up ... but we’re cautiously projecting that.”

Sanders also mentioned initial financial benefits from the start of managed competition — something voters approved back in 2006, but not implemented until recently. He projects at least a 10 percent savings when fully implemented in the coming years.

Managed competition, along with changes to retiree health care and pension reform will be the keys to the city resolving a structural deficit that he said got its start 30 years ago due to San Diego having a city manager form of government and the City Council deciding in 1996 and 2002 to under fund the pension system while increasing employee benefits.

“(That decision) makes no sense whatsoever,” he said. “(But) earnings were masking (the problem being created).”

Whoever succeeds Sanders when he is termed-out in December 2012 will inherit a city financially poised for rebuilding, he said.

The new mayor and City Council “can start rebuilding city services the way the community wants, such as more library hours and street (repairs),” he said.

Some of the savings, Sanders said, will come through an overhauled retiree health care program, that he said “is sacred to every government agency.”

The unfunded liability — due to a pay-as-you-go formula — means this year the city will pay $58 million, but by 2015 faced a projected $100 million bill.

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