S.D. mayor proposes across-the-board spending increases as city taps revived revenue and federal aid
San Diego Mayor Todd Gloria is proposing to spend significantly more money on parks, the arts, reducing homelessness, boosting quality of life and more, with more services delivered more quickly.
Gloria’s proposed budget unveiled April 15 covers the new fiscal year that starts July 1. It would increase city spending in essentially all areas, from graffiti abatement to large infrastructure projects. The city’s annual operating budget would jump 8.6 percent, from $1.74 billion to $1.89 billion.
The city has enough money to cover such increases and avoid any budget cuts because of reviving tax revenue — especially from sales taxes — and $180 million in federal pandemic aid left over from the $300 million San Diego got last spring.
Another factor is the city’s annual pension payment shrinking by $31 million because of strong stock market returns in 2020. Gloria also is proposing to delay $30 million in scheduled contributions to city reserves.
Pension board lowers San Diego’s annual payment $31M in response to stock market gains last year
Shift gives Mayor Gloria more money to spend in proposed budget he will unveil April 15.
Gloria characterized his budget as a “transitional” spending plan that San Diego residents made possible by getting vaccinated against COVID-19 and persevering through the pandemic.
“What we want to accomplish in this budget is to begin a transition from a sort of reactive and crisis-oriented approach to one that is much more stable and service-oriented and capable of meeting the expectations and needs of our residents and the neighborhoods of our city,” the mayor said.
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The budget makes modest, incremental increases to a wide variety of programs and initiatives. They include policing vacation rentals, weed abatement, sanitizing sidewalks, cracking down on abandoned cars and boosting security at libraries.
“These are relatively modest things, but I think these are things San Diegans will notice in their day-to-day lives,” Gloria said.
The budget also would boost aid for small businesses, expand free broadband access in low-income areas, fund aggressive enforcement of scooter regulations and add new parking enforcement teams to help free up spots in key areas.
On traffic, the budget would spend $300,000 to create a new management center where city officials could observe intersections and immediately change stoplights to alleviate congestion.
It would spend $550,000 to create a new team of workers who would replace outdated and often malfunctioning signal loops — patches of pavement near stoplights that trigger lights to change when a car activates them.
Arts funding would increase from $9.6 million to $12.7 million. And the city would spend $4.3 million boosting parks with more employee recruitment, better training, new grant writers and conversion of many part-time workers to full time.
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Those proposed expenditures are part of the $77.7 million the mayor says he wants to spend on “critical operational needs.”
The budget would look much different without vaccines and federal pandemic aid, Gloria said.
“We would be talking about significant, drastic and Draconian cuts,” he said.
“What we want to accomplish in this budget is to begin a transition from a sort of reactive and crisis-oriented approach to one that is much more stable and service-oriented.”
— San Diego Mayor Todd Gloria
Gloria said he delayed scheduled reserve contributions partly because that could jeopardize federal pandemic aid. If a city can afford to increase its reserves, it is hard to justify needing such aid.
But it’s also because “we need to put as much money as we can into services because that is what San Diegans need right now to get through this transition period,” Gloria said. “My promise to San Diegans is that every nickel that has been entrusted to us will be used to benefit the people and the neighborhoods we serve.”
The city’s general fund reserve would remain at $205 million under Gloria’s proposal, about 11 percent of the proposed budget of $1.89 billion. City reserves could become crucial if there is an economic recession.
The budget includes $13.3 million to cover anticipated pay raises for police officers, firefighters and lifeguards, plus targeted raises for other jobs in which workers are making much less than their counterparts in other cities.
Most workers will get roughly 10 percent raises over two years, but some targeted positions are getting much more
Nearly 1,800 city jobs, about 15 percent of the city’s 11,940 budgeted positions, are vacant. City officials say that’s primarily because of uncompetitive salaries.
Most city workers are slated to get pay raises of just over 3 percent this fiscal year that have already been built into the budget, so the $13.3 million would cover larger raises for public safety workers and targeted workers.
The budget also includes more general fund spending on infrastructure than in recent years. The city would devote a record $28.4 million in general fund money to infrastructure under Proposition H, a 2016 ballot measure.
That money would cover $16 million for parks upgrades, $7 million for sidewalks and $2 million for fire stations.
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Gloria is proposing an additional $29.7 million in general fund money that would cover flood prevention and resilience and efforts to reduce pollution in storm water.
Those infrastructure expenditures would be in addition to a separate capital improvement budget of $809 million. Most of the money from that budget comes from gas tax revenue, grants and other sources.
City spending on homelessness prevention would increase from $49 million to $63 million under Gloria’s proposal, with the extra money being spent primarily on new shelter beds that have already been announced and stronger coordination of street outreach efforts.
Homelessness money would remain about $20 million from the city and about $3 million from the federal government, but the state’s contribution would sharply increase from $24.5 million to $39.5 million — accounting for the annual increase in local spending.
While Gloria proposes to increase police funding in some areas, including overtime, the police budget actually would decrease from $593.3 million to $584.2 million because of savings created by the city’s ongoing pension changes.
A revival in revenue plays a key role in funding the proposed new spending. Strong homes sales are expected to spike property taxes during the new fiscal year from $672 million to $700 million, while sales tax revenue is expected to rise from $321 million to $369 million.
Hotel taxes, the revenue stream hit hardest by the pandemic, have returned to 2019 levels and are projected to increase 37 percent in the new fiscal year. But they are still well below where they had been expected to increase before the pandemic.
San Diego is projected to use $120 million of federal pandemic aid during the ongoing budget year, leaving $180 million. Gloria is proposing to spend $124 million in the new budget year and the remaining $56 million in fiscal 2024.