Tuesday, June 8, 2010

San Diego Grand Jury Says City Needs Serious Financial Overhaul

Tuesday, June 8, 2010

The city of San Diego, now facing a long-term deficit of about $7 billion mainly related to delayed debts to its employee pension fund, needs to evaluate its entire financial structure and undertake significant changes to return to fiscal health, according to a county grand jury report released June 8.

In the 22-page report, the grand jury notes the underlying cause for the city’s problems was the underfunding of its employee pension fund in 1996 and 2002. As of June 2009, the pension fund was underfunded to the tune of $2.2 billion, while its employee retiree health plan was underfunded by some $1.3 billion, the report states.

Among the recommendations from the grand jury to return the city to financial health are:

• Marketing some of the city’s most attractive parks, including Balboa Park and Mission Bay Park, to developers for long-term leasing contracts.

• Outsourcing the city’s library system.

• Repealing the People’s Ordinance, which provides free trash removal service to residents.

• Consolidating some city services with similar services provided by the county of San Diego.

• Researching alternate retirement systems to determine whether the San Diego City Employees Retirement System should be dissolved in favor of another system or should be outsourced.

• Possibly discontinuing a deferred retirement plan for long-term city workers unless a study shows that it’s saving the city more money than it costs.

Actions taken by elected city leaders to resolve the city’s financial woes should be put to city voters for their approval, the grand jury report recommends.

The report also criticizes the current answer to the crisis, namely cutting hundreds of jobs, a move that has resulted in the reduction or elimination of many vital services. The report cites recent “rolling brownouts” at certain fire stations, and eliminating the mounted police force.

“Layoffs, or not filling vacant positions caused by attrition, do not positively serve the community interest and adversely impact the safety of city residents, businesses and visitors,” according to the grand jury report.

— Mike Allen


No comments: