City Manager, Staff Evaluate State Budget Proposal with 'Painful' Cuts
City Manager Gary Brown said his staff is currently digesting the 266-page budget proposal presented by Gov. Jerry Brown Monday morning and that plans to halt redevelopment agencies could seriously impact Imperial Beach.
Imperial Beach City Manager Gary Brown and his staff haven't started reading the 266-page budget proposal from Gov. Jerry Brown yet but said the threat of stopping redevelopment agencies could bring the city's progress to a halt.
"I wish I knew all the potential impacts but obviously the redevelopment could hit us the hardest," he said. "Until you start seeing all those details it's hard to say."
The city manager plans to work through the proposal in the next week, but he called this the beginning of a long process of negotiating and deal making in order to pass the budget.
"So far from what I've seen, I just don't see how it could work," City Manager Brown said. "So many of the things people have been proud of in the past couple years wouldn't happen [without redevelopment]."
According to the city manager, improvements accomplished through redevelopment agency bonds in Imperial Beach include major street changes, facade improvement programs for local commercial businesses, home improvement programs, park improvements and lighting and a $7 million contract with Pacifica Companies to build a new hotel at 800 Seacoast Dr.
Based on the city's tax revenue, which ranks as some of the lowest in the state, "the city would never be able to do those things" without redevelopment funds, he said.
Next up is a plan to demolish and rebuild the Ninth Street and Palm Avenue shopping center, scheduled to begin this spring. The city manager said he doesn't anticipate budget changes to impact the project but can't say for sure until more details are known or decided.
The success of large projects can be economic anchors to spur private investment much as the Centre City Development Corporation has in downtown San Diego.
"We are where San Diego was 15 to 20 years ago, but if you can get that catalytic project going, who knows what it all leads to?" he said.
The governor's proposal includes a pay cut for state employees, drawbacks in publicly funded medical services and a $1 billion takeaway from colleges.
Gov. Brown said the state has had budgets for the past 10 years with "gimmicks and tricks" and now it's time to return to fiscal responsibility.
"What I propose will be painful," Gov. Brown said.
Budget details can be viewed at www.ebudget.ca.gov.
Budget Highlights:
- 8-10 percent pay cut for most state employees.
- Five-year extension on certain taxes.
- No major cuts for K-12 education.
- Total spending for 2011-12: $127.4 billion.
- $1 billion reserve.
- $12 billion in revenue extensions.
- $1.7 billion cut to Medi-Cal.
- $1 billion cut to the University of California and California State University systems. Community college class costs would rise from $26 to $36 per unit.
- Shifts many responsibilities from the state to local governments.
- Amnesty program for taxpayers who have avoided or under reported income owed to the state.
- Phaseout of current redevelopment agency funding structure.
University of California President Mark Yudof, in an "open letter to California," said it was a "sad day" due to the governor's proposal.
For the first time, Yudof said, the collective tuition payments of UC students—$7,930 per person—would exceed the state's annual per student contribution of $7,210.
"The crossing of this threshold transcends mere symbolism and should be profoundly disturbing to all Californians," Yudof said in the letter.
"My preference at this point, and my sense of where the Board of Regents stands on this issue, is to not seek an additional fee increase; that said, I cannot fully commit to this course until the board and I have assessed the impact of permanent reductions on campuses," he said.
California State University Chancellor Charles B. Reed released a statement as well, saying, "While we understand the administration has limited options, higher education is the state's main economic driver, and we cannot improve our economy without an educated workforce. ... The magnitude of the budget reduction in one year will have serious impacts on the state's economy, limit access for students seeking entrance into our universities, and restrict classes and services for our current students."
Milan Moravec
5:27 pm on Tuesday, January 11, 2011
University of California refutes Gov budget: inuguration $100,000; Chancellor Birgeneau ($500,000 salary) hires $3,000,000 consultants to do work of his job and his many vice-chancellors.
University of California Chancellor Robert J Birgeneau’s eight-year fiscal track record is dismal indeed. He would like to blame the politicians, since they stopped giving him every dollar he has asked for, and the state legislators do share some responsibility for the financial crisis. But not in the sense he means.
A competent chancellor would have been on top of identifying inefficiencies in the system and then crafting a plan to fix them. Competent oversight by the Board of Regents and the legislature would have required him to provide data on problems and on what steps he was taking to solve them. Instead, every year Birgeneau would request a budget increase, the regents would agree to it, and the legislature would provide. The hard questions were avoided by all concerned, and the problems just piled up to $150 million of inefficiencies….until there was no money left.
Steve Futterman
8:09 pm on Saturday, January 15, 2011
We don't need a Redevelopment Agency for our city to be successful. Gary Brown is dead wrong on this and it's unfortunate that his statments regarding success cannot be backed up with good data. Before the citizens of I.B. dismiss the Governors plan they should learn about how RDA financing works from sources outside local government staffers and the California Redevelopment Agency. Both provide a distorted and incomplete look at a process that provides for a minority of special interests. Economic development is extremley important however the City Managers claims that RDA is the only way to realize financial independence is plain silly.
Ed Teel
7:19 am on Monday, January 17, 2011
I must agree with Mr. Futterman that we do not need Redevelopment to be successful as a city. The problem is, we have already started the process. A lot of borrowed money has already been spent that will need to be repaid in the future. Redevelopment money is not free.
The Hotel and shopping center projects are the only real hope we have for a source of income.
When properly managed, Redevelopment works. If you disagree take a good look at Horton Plaza.
Steve Futterman
7:24 pm on Tuesday, January 18, 2011
I agree with Mr. Teel that these projects have to move forward because we have already made our bed and have to sleep in it. Failure is not an option . Both must be successful. My point is in regards to how we move forward if RDA goes away. I personally doubt they will. To Mr. Teels point that Redevelopment Works I believe he's making the same point that Gary Brown will and the lobbyist group the California Redevelopment Agency. They always point to Horton Plaza as their poster boy. Development does work however it's the RDA financial model of accumulating large amounts of debt and the diversion of money away from esstential services that I don't see as creating true prosperit. RDA projects have done nothing to change the financial realities of the municipalities that have them. True San Diego has Hoton Plaza but they also looking at laying off police and fire fighters, their school system is in terrible shape, and they have some of the worst rated streets in the country. Mr Teels statment that "when properly managed Redevelopment works" is true however if you are a special interest or part of the privilaged few that receive that are on the recieving end. This money is better spent on education. That is the key to Californias and the nations success. Not strip malls
Steve Futterman
4:50 am on Wednesday, January 19, 2011
Just a clarification to Mr. Teels observation of my post. We do in fact need development in Imperial Beach. That is a fact. It’s the Redevelopment Agency financing and their practices of funding projects using public money is where I believe we disagree. Where it seems we both agree is that both the shopping center and the hotel need to be completed and more importantly successful. I believe they can if they adopt business models that work for Imperial Beach. The city already spent the money so we have to move forward. I will support both finished projects with my dollars. The point of the article was about how Redevelopment Agencies could be impacted if changes happen at the State level. I actually don’t see that happening. However if citizens where provided all the facts about how Redevelopment Agency’s have to accumulate large amounts of public debt with no guarantee of a projects return I believe they would be less likely to support them. As for Horton Plaza I’m not sure exactly what point Mr. Teel was trying to make. If the point is that RDAs can build malls with public money he’s right. If that’s the best way to spend public money then we probably disagree. San Diego is getting ready to lay off firefighters, police officers, their schools are struggling but hey they have a mall. The public money that RDA’s divert from education and essential services I believe is not well spent. That money is better spent on education which is the only way to true economic prosperity.
Ed Teel
8:02 am on Wednesday, January 19, 2011
Steve, I don't think we disagree at all. The Redevelopment Agency is the problem. It is not just here in Imperial Beach, it is all over the state. The public money that RDA's spend because of required Government red tape is justification to do away with all RDA's.
Horton Plaza is the best example I know of in southern California where RDA funds worked. The real magic was what happened after the mall was built. Skid R0w became the Gaslamp district.
As far as San Diego goes think of how bad off they would be if they didn't have the mall and the gaslamp. There is a lot of sales tax, TOT, business licenses, parkiing meeters etc. lots, parking tickets, and fines from drunk tourists. All that money would not be available if the RDA funds were not used to build the mall. Yes,I am being a smart ass.
What do you think will happen to the I.B. hotel project if the RDA funding is cut off? As much as I would like to see the hotel rebuilt with private investors, I just do not think it will happen.
Steve Futterman
8:34 pm on Wednesday, January 19, 2011
Ed, I don't think anyone would dispute that Horton Plaza is not a good thing for downtown San Diego. Your statement "think of how bad off they would be if they didn't have the mall and the gaslamp" may have made sense in the 70s when it was built however San Diego's Mayor considering laying off police, fire and other essential services seems to me as bad as it gets. The point being that RDA s do creat economic activity in a way that is limited however does not contribute to the economic stability in a way that you or City Manager Brown want the public to believe. Now I couldn't disagree with you more about the hotel. If there is truly a market, investors will invest. But the RDA creates an uncompetive enviornment as is the case in I.B. where one entity is supplemented by the government in building their business. Who would want to or have to compete against that kind of of money. Why should they. Many Citys in America and the world develop successfully without RDAs. They do it with innovation and education. Additionally I still have faith in capitilism and the free market. I don't rule out public private options in all cases however the RDA model is not one of them and I would urge others to take the time to understand how they work. Finally I also think its good stuff that we're having this discussion and hope others join in so thanks again.