Okay, time to take a look at the Mayor’s proposed budget. The very first thing I would like to note about this budget is that the 802 page PDF is not properly tabbed, making it a ginormous pain in the ass to try to read. Dellums’s version of transparency in government, I guess.
Okay, let’s get started. For next year, we’re anticipating an $83 million General Fund deficit. The Mayor’s idea of the best way to deal with that is to put off a bunch of costs to a time when he’s no longer Mayor.
So, revenues for the General Fund were $50.8 million less than last year, but expenses are $32 million higher, leaving us with an $83 million hole to close. Those extra expenses include the extra funding we’re going to have to give Kids First, a 4% cost of living pay increase for police ($5.6 million), and rising medical costs. Oh, and also a little over $4 million in expenses that we couldn’t afford last year, so just pushed off to deal with in July.
So what are we going to do about all this? Well, we’re going to have to cut some of our 4000+ positions. This is what’s been proposed to be cut from the General Fund:
- Mayor: cut 1.50 FTE (positions are currently vacant)
- City Administrator: cut 1 FTE
- Contracting and Purchasing: cut 1.5 FTE
- Information Technology: cut 5.6 FTE
- Finance & Management: cut 6.91 FTE
- Human Resources: cut 5.45 FTE
- Fire Services: cut 2 FTE
- Library Services: cut 14.05 FTE
- Parks and Recreation: cut 9.54 FTE
- Total FTEs cut: 52.55
So…perhaps you’re thinking right about now that losing less than 60 FTEs seems, um, pretty painless compared to what you were told to expect over the last few months. Perhaps you’re thinking that it doesn’t seem like very many cuts in the face of an $83 million deficit. If you aren’t thinking those things, then you should be. I’m going to take the actual expenditure cuts and revenue enhancements the Mayor proposes first, then we’ll get to the trickery.
Okay, revenue increases include the following:
- $0.50 million from a business tax amnesty. (one-time revenue)
- $0.55 million from the change to the City’s real estate transfer tax on July’s ballot.
- $0.30 million from the marijuana tax on the July ballot.
- $1 million from higher parking ticket prices
- $1 million by increasing charges for services (like at Rec Centers and such)
And that’s it. Now, the cuts.
- Those 52.55 eliminated FTEs I listed above? Yeah, that’ll save a whopping $2.8 million.
- Save $0.8 million by downgrading a few positions and fiddling with some work schedules.
- Monthly city shutdowns. (This amounts to a five percent pay cut for civilian employees.) Saves $3.44 million.
- Five percent retirement increase in retirement contribution for civilian employees. Saves $3.57 million.
- Okay, I have to pause here. I’m trying to avoid too much “we should do this or we should do that” while explaining the budget, because my suggested balancing measures are going to get a post of their own later on, and I’d rather wait for that. But, I cannot let this one go. They’re calling this a 10% concession. Which, well, it is, but this is the absolute dumbest way of implementing a 10% concession I can even think of. First, those stupid shutdowns are insanely unfair to Oakland’s residents, who should not be deprived of basic City services 12 times a year. Second, if you’re going to reduce staff paychecks by 5%, a retirement pick-up is a dumb way to do it. Since retirement contributions are determined as a percentage of wages paid, the smart thing to do would be to reduce salaries by that 5%. Then, when you pay the same percentage to CalPERS, you’re paying less money. Anyway, more on concessions in a later post.
- Save $0.18 million by eliminating the Senior Shuttle and save $0.15 million by eliminating the Senior Set-Aside.
- Save $3.8 million if the Kids First compromise on the July ballot passes.
- A couple of other small, and not very interesting changes.
Okay, so that’s everything you’re going to lose from the General Fund under this budget. So where’s the rest of the money coming from? Two places. The Federal government, and magic.
The Feds first. The proposed budget eliminates 140 police officers from the General Fund. We’re expecting/hoping to get money from the federal government to pay for those police officers instead. We’ll find out at the end of summer if we get the money or not. If we do (which this budget anticipates), then, we’ve just scored ourselves $23 million. If we don’t, then we’re going to have to come back and make more cuts in order to pay for those officers. If we do get the grant, the funding will last three years, and at that point we’ll have to go back to paying for the officers out of the General Fund (or pass another police tax to pay for them, or something).
Now, the magic. Or, more appropriately, the future. Do you remember the other day when I mentioned all that money we have to spend to repay negative fund balances? And how we put these negative funds on 10 year repayment plans back in 2005, but then didn’t actually stick to the plans, which made the negative balance worse and just ends up costing us more? Well, the Mayor’s proposed budget introduces the brilliant idea of just, um, not paying anything at all into them for the next two years. And that’s not just not paying back the deficits, that’s not paying into them at all, even for ongoing costs. So basically, the Mayor is proposing we balance the budget by going $50 million more into debt. In theory we’d resume payment of them in 2011. Yeah, that 2011. The one where we already don’t have any money. But hey, it saves us $23.78 million this year.
Then we’re saving $4.3 million by transferring 26.32 FTEs currently paid by the General Fund into other funds. And we’ll save $6 million through debt restructuring (extending payment periods), which, like the suspended payments to negative internal funds, might help us out today, but will only cost us more money in the long term.
So all the above is just dealing with the General Fund deficit (the $83 million you keep hearing about). But there are shortfalls in other funds as well, so the budget also proposes to cut positions from them. Here’s how that breaks down:
- Park maintenance: losing 20.18 FTE
- Tree services: losing 4.00 FTE
- Street maintenance: losing 12.00 FTE
- Traffic maintenance: losing 3.00 FTE
- Facilities maintenance (painting and custodial services): losing 19.00 FTE
- CEDA development services: losing 21.22 FTE
- No more Bookmobile
- And a number of other positions scattered over a whole bunch of functions.
And that’s, well, all I have time for today, but I think it’s a pretty solid overview. I’ll take a look at it in more detail over the coming weeks. As for what the Council thinks of all this, well, we’ll find out on Wednesday, when they meet at 4 PM (PDF) to discuss the proposal.