The San Jose City Council Tuesday unanimously approved Mayor Sam Liccardo’s list of spending priorities for the next fiscal year budget as the city prepares to meet with police and fire unions for new contract talks on Wednesday.
The city’s upcoming 2015-2016 General Fund budget is estimated at more than $3 billion, according to Liccardo spokesman Ahmad Chapman. The latest budget forecasts a slim surplus of $8.2 million, only a half-percent of city revenues and expenditures but a far cry from the deficits the city endured from 2010 to 2012 that together amounted to $318 million, city officials said.
The city recovered by instituting layoffs and hiring freezes that reduced the city’s police, fire and other employees by a quarter; decreases in pay for remaining employees; severe cuts in city services and voter approval in 2012 of pension and health care reform Measure B, which has brought $25 million in annual savings for the General Fund, officials said.
Liccardo said at the council’s meeting at City Hall Tuesday afternoon:
“We are fortunate to be in a position which we were not in 2010, 2011 or 2012, through an awful lot of hard decisions and some very difficult times, certainly for our employees and residents and for our council members here who remember those days.”
“We have emerged and I want to thank in particular our employees who sacrificed greatly through this time, they suffered pay cuts, pension reform and certainly many reductions in positions which had existing employees working twice as hard.”
Liccardo said that the city’s finances are projected to be stable over the next five years, with even smaller surpluses in 2016-2017 and 2017-2018, a slight deficit from a drop in revenues in 2018-2019 and then another modest surplus the following year.
The council approved Liccardo’s Budget Message for the 2015-2016 fiscal year, a series of general spending priorities leading up to detailed proposals and community hearings in the city’s 10 council districts in April and May prior to final approval of the budget in June.
In his message to the council, Liccardo stated that with the city back to fiscal stability, services put aside in the lean years can be restored, such as after-school programs, repairs to city streets and libraries open six days a week and summer jobs for at-risk teens living in neighborhoods with street gangs.
Liccardo also wants to work with the Santa Clara Valley Transportation Authority toward expanding the BART train route to the South Bay from planned stations in Milpitas and Berryessa in north San Jose to up to three other proposed stations in San Jose and one in Santa Clara.
The VTA has proposed seeking a grant from the U.S. government next year for $1.1 billion to go toward funding part of the cost, but local funds might be needed to pay for two of the stations, he said. Among potential ways for the city to raise money for the other stations, over about six years, include seeking state cap and trade funds, creating local districts for property tax increment financing and a ballot measure in 2016 asking San Jose voters to increase the local sales tax, he said.
The city has directed the City Manager’s Office to provide $1 million in one-time funding to the San Jose Works program for the at-risk youth jobs plan, in partnership with the private sector and a $1 million contribution from Santa Clara County, he said.
The mayor cited his support for continuing the city’s Police Staffing Restoration Strategy with the goal of increasing budgeted sworn officers from 1,109 to 1,250 by the end of the decade, the level the city’s police force had in 2011.
At a news conference at City Hall before the vote, Liccardo said that contract renewal negotiations between the city and union leaders representing police officers and firefighters would begin Wednesday and talks with unions for other city workers within a couple of days:
“We know it won’t be simple. … It’s going to take some time. If we agreed on everything we wouldn’t need to negotiate.”
Liccardo said that during the collective bargaining process, the city would be focused on changes to police and fire disability pensions to save money needed to restore city services while at the same time:
“… we recognize the need to better retain police officers and improve our hiring as well. … And so, we’ll need to find some middle ground on several of these issues.”
The city anticipates saving $20 million for its General Fund from the negotiations in addition to the $25 million saved from Measure B, rather than $50 million in additional savings targeted by the measure, he said. He also wants the city to consider consolidating firefighter emergency services to permit city fire personnel to both arrive first at emergencies to stabilize patients and transport them to hospitals.
Currently, state law requires counties to determine what agency transports patients in emergencies and while San Jose emergency personnel must arrive first, Santa Clara County’s contracted private service, Rural Metro, is responsible for transporting the patients, he said.
Rather than have two agencies respond, the city should do both, the mayor said:
“We’ve seen in other cities where they are able to consolidate those services. … Folks who are arriving first for the emergency are also providing the transport. In that way, the fees that are paid for the ambulance transport rather than go to a private company, can help support our fire department and improve our response and improve, obviously, the service to the patient.”
Fire chiefs in other cities in the county have expressed interest in the same approach, Liccardo said:
“… so we’re hopeful that there will be a collaborative conversation with our county around this very idea and we expect there will be a letter coming from the city shortly, I think it should be sent to the county today, when the council makes it final vote, and we’ll be talking about doing a feasibility study to assess this.”
During the council meeting, Councilman Johnny Khamis, who represents District 10, echoed concerns mentioned in Liccardo’s budget message that the city has been deferring funds for maintaining its streets for many years, the costs for which now stand at $500 million and could reach $1 billion in five years.