City News Service
A report from a citizens task force today projected the city's deficit for the fiscal year starting July 1 at more than double the mayor's estimate of $56.7 million.
An analysis by the Citizen's Fiscal Sustainability Task Force added $29.3 million in liability for retired employee healthcare costs and $44.4 million for financing projects to catch up on deferred maintenance projects.
That brings the projected shortfall for the 2012 fiscal year to $130.4 million.
The city should adopt a plan for fully funding the deferred maintenance backlog as part of its budget plan, the task force members said.
The mayor's deficit projection and the healthcare liability add up to "structural deficit'' of $86 million, meaning that programs now in place will cost the same amount in coming years unless changes are made, according to the report.
"The task force believes this structural deficit condition must be rectified," the authors wrote.
"Action is required now. The city leadership must address the city's fiscal problems with a far greater sense of urgency than has been previously exhibited.''
Since voters rejected a half-cent sales tax increase in November, spending reductions will have to make up most of the solution, according to the task force.
Among the task force recommendations:
• more than halving the annual allowance of retiree health care from $8,800 a year per employee to $4,000 annually;
• adopt private sector-style benefit plans to lower city costs;
• reduce the salaries of employees making over $100,000 annually by 4 percent, and those making between $31,000 and $100,000 by 2 percent;
• and consider outsourcing the entire library and trash collection systems.
The task force is chaired by Vincent Mudd, the owner of San Diego Office Interiors and chairman of the San Diego Regional Chamber of Commerce. Among the members are Richard Vortmanm, the president and CEO of National Steel and Shipbuilding, and former City Councilwoman Barbara Warden.