You are the lucky ones and you probably don’t even know it. And if you do, you probably don’t appreciate it.
Hard times are here for cities across California, and they are going to get harder in the years ahead.
Costa Mesa has sent pink slips to half its employees. San Jose is demanding 10% cuts in pay and benefits from its 11 employee unions, and that only cleans up a third of its $105-million budget deficit.
The heart of the problem is declining revenue and the soaring cost of pensions and health care for city workers — more than a $1-billion bill for Los Angeles next year, a quarter of its operating budget.
Burbank, with an $8.7-million deficit in the coming fiscal year, and Glendale, with a $15-million deficit, have their budget problems, too, but with a difference.
Many cities in California are like families living beyond their means, buying houses, cars and toys they can’t afford as if there was no tomorrow, as if the nation’s economic meltdown would pass and what was normal would soon return. Well, tomorrow has come and normal isn’t coming back for a long, long time — maybe never.
In interviews last week, both Burbank City Manager Mike Flad and Glendale City Manager Jim Starbird described in similar terms how their cities have been “living within their means,” have money in the bank with large reserve funds, and are working “strategically” to solve their financial problems — though there will be pain for city workers and residents alike.
“We’re blessed because of where we are from an economic standpoint, but things are never going back to the way it was,” said Flad. “We need to rethink what we’re doing and how we’re doing it. We need to recalculate where we’re going to go, to redirect our priorities.”
In Starbird’s words: “This is like what happened after Proposition 13 — the public sector will never be the same. People need to be aware the economy will never be the same as it was. They will feel the loss of services, and the loss of quality in services, unless we can reduce the cost of providing those services.”
He rattled off a long list of cost-saving measures, including area police commands, reducing the number of $50-an-hour paramedics and increasing the number of emergency medical technicians, privatizing most tree trimming and consolidating departments, and cited others, like firefighters “walking away” from a four-year contract that would have given them pay raises every year.
“The goal is always to reduce costs and get the same quality of service. Otherwise, the only ones who lose is the public,” Flad said
He talked about the city’s five-year strategy that emphasizes efficiencies to provide the same service at a lower cost by contracting out some trimming of the city’s 30,000 trees to private companies, reducing hours some services are available — like staggering library hours — raising revenue, mainly on non-residents, by asking voters to approve higher hotel occupancy taxes and parking taxes in the next few years. He also cited one-time savings by deferring capital projects and other budget juggling maneuvers.
But the key is employee payroll and benefit costs — 80% of General Fund operating expenses.
Neither city is burdened with health care costs for retirees as Los Angeles is, but they are counting on workers at all levels to accept pay reductions, or at least no raises for several years, and increased contributions to pensions and health care — rising costs that account for $7 million of Burbank’s $8.7-million deficit — and expanding joint operations where feasible between the two cities, as well as with Pasadena.
Flad and Starbird are counting on the workforce and residents to participate actively in public discussions about how their cities can weather this financial storm and preserve the quality of life. They call it “community pride.”
It is striking how they embrace with enthusiasm the winds of change that are blowing — something that most find disconcerting and resist.
“Desperation breeds inspiration,” said Flad. “I’ve never been more inspired to change what we’re doing. Things will be different, but I believe we will do a better job in a lot of ways.”
Starbird is protective of the city’s top-rated Fire Department, and of the city’s standing as one of the state’s 10 safest cities, and worries about protecting the quality of the infrastructure or letting streets deteriorate by deferring repaving projects.
“We talked with our executives, managers and employees and know they want to be part of the solution,” he said. “But there’s always resistance to change. If critical mass isn’t there, you can’t make change. We’re at that point.”
There’s no doubt in my mind that our lives are going to change dramatically in coming years, including the ways in which we define work and prosperity and happiness.
Communities that embrace what has to be done to preserve the quality of life and the sense of well-being will thrive. Those that don’t will go beyond the point of critical mass and melt down.
RON KAYE can be reached at email@example.com. Share your thoughts and stories with him.