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If the city wants to increase taxes or institute new fees to help close a $77 million deficit lurking next year, it’ll need to decide soon. Very soon.
When he wakes up every morning, the first thing Bob Nelson does is check the calendar.
Nelson, the chairman of a San Diego city committee tasked with finding new money, knows that time is running out if new fees or taxes are going to do much to help solve the $77 million budget deficit the city faces in 2012.
“If it’s right to do something, let’s do it now,” Nelson said. “If it’s not right, let’s not do it ever.”
The City Council passed a budget in December that patched together a $179 million gap with a majority of one-time fixes. The city made the decision six months early. Part of the rationale was to give the city extra breathing room to address long-term problems before needing to pass another budget in June 2011.
The calendar already is forcing the air out of that breathing room.
If city leaders decided they wanted to fix the gap by pursuing new taxes and fees for trash and stormwater collection, which combined could raise close to $80 million annually, they’d need voter approval. That creates an early deadline. Unless city leaders decide to call a special election, they have only until this June to begin the process of putting a ballot proposition on the November ballot — the last scheduled election before the 2012 budget would be adopted next summer.
Nelson has been exhorting his committee to make recommendations by June. He believes it’s already too late to put stormwater fees on the ballot because of the time needed to complete a comprehensive study on the issue. Stricter federal regulations have increased the city’s stormwater costs without increases in funding.
But he thinks there is time for a ballot measure to repeal the 1919 city ordinance that keeps the city from charging for trash collection at single family homes.
Councilman Todd Gloria, who has been the council’s most outspoken proponent of considering tax or fee increases, said he’s feeling a sense of urgency.
“As the timeframe, as you point out, gets shorter then some of these options go away,” Gloria said.
He added that he believes new revenues would have to be part of the plan to solve the 2012 deficit. And both he and Nelson said the support of San Diego Mayor Jerry Sanders for any revenue-increasing ballot measure would be critical.
But no one knows what the mayor is going to do, though throwing his support behind a new tax initiative would be a dramatic departure from his previous policies. Asked about tax increases and the 2012 budget, Sanders’ spokesman, Darren Pudgil, demurred.
Pudgil said in an e-mail that the mayor is focused on solving a $15.3 million gap in next year’s budget caused by an unexpected increase in the city’s pension payment.
Sanders had an opportunity to talk about his long-term budget plans two weeks ago in his State of the City address, but instead said he would return with ideas for solving the city’s structural budget problems in 18 months.
It’s not just the calendar that pinches efforts to close the gap in 2012. The most significant cost-saving measure now pushed by Sanders is a reform of retiree health care and its $1.3 billion unfunded liability.
But since the city already doesn’t pay the full amount it owes to that fund each year, even a dramatic decrease in its long-term health care debt could have little to no effect on the $77 million the city needs to find by next June.
Clarification: An earlier version of this story said city leaders had until June to put a ballot proposition on this November’s ballot. The deadline to submit a ballot proposition to the county is Aug. 6, but the city would have to begin such a process by June.