RECKLESS $6+ MILLION BALLOT MEASURE

The Police Union and some local citizens are mounting a possible fall ballot measure that would compel San Carlos to:

1. Maintain a municipal police department,
2. Return staffing levels to what they were in 2002, and
3. Pay our officers market rate.

This ballot measure would:

1. Force San Carlos to hire about 10 more officers,
2. Give our current officers a 10-20% pay raise,
3. Cost the city over 3 million dollars, and
4. Short circuit 3 million in proposed savings.

If this was to get on the ballot and pass, the city council would have to:

1. Close Every park,
2. Close the Youth Center,
3. Close the Adult Community Center

SEE THE NEWS STORY

FORGET NOT FIELD QUALITY

The City Council gave the green light to the City Manager to pursue the outsourcing of public safety, a path which alleviates the budget crisis and preserves Parks and Recreation. But, in the name of protecting park maintenance workers from layoffs, the outsourcing of park maintenance is being soft pedaled. That is placing government jobs in front of field quality. If you have not been on the fields, specifically if your children have not played soccer on the fields, you might not know that the grass is too long, the gopher holes too many and the general quality sub par. Look, I am a happy guy, because it looks like the parks are going to remain open. And I like the idea that some of the park maintenance workers are going to be re-purposed to the sewer upgrade. People feel strongly that these are nice, upstanding hard working and talented city employees. But the City Manager indicated that actual layoffs to enable maintenance outsourcing will not happen and that we will have to wait for retirements and the like, before this option is fully implemented. Hells no! Government is here to provide services, not jobs. Government needs to relentlessly pursue the most efficient delivery models. This isn't the moment to push on this issue. The larger budget issues and public safety outsourcing needs to be pushed over the goal line. But let's bookmark this issue and be ready to return to it when the time is right.

More Detail from 3/13 Budget Meeting

Many of you have requested more detail.  Here it is.  After you have read this, you will see why not outsourcing public safety will lead to the complete elimination of parks and recreation in the next one to two years and city bankruptcy not long thereafter.  You will also see how and why outsourcing public safety will leave the city financially healthy and sustainable.

From 2006 through 2010 city expenses rose an average annual 1.3% whereas revenues rose a mere 0.5% annually.  Note that the 2010 and 2011 revenue numbers shown in the chart below reflect the projected revenue impacts of the economic downturn. 















That modest growth in expenses masks years of steep cuts.  The city has endured 11 straight years under the budget axe.  As a fiscal conservative, that was probably the right thing.  In the past five years, city staffing has fallen 15% from 126 to 107 salaried positions.  Middle management, a layer that the private sector long ago eliminated, is gone.  And we know have the leanest per-capita staffing for comparable cities on the Peninsula.

 
Individual departments have shrunk dramatically over that period: administrative service is down 27.2%, public works is down 8.8% and parks and recreation is down 12.6%.  Employee benefits have been cut.  There has been a one week furloughs for all city employees for six years running.  Management has given back negotiated pay raises and bonuses.  Salaries generally are 5-10% below average for comparable cities.  See the links at the bottom of this post to the full presentation and video playback from the 3/13 budget meeting.  But you simply cannot contend that there is fat left to cut.  We are cutting meat. Soon it will be bones.

Now there are two paths the city can take.  Path #1 is an outsourcing of public safety.  That is the path we need to take.  But let's look at the alternative first.

Path #2 is a 20% budget cut.  That path is painful.  We lose the Youth Center.  We lose 3 full plus 3 part time police positions.  12 other full time and 2 other part time positions would be chopped around the city government.  This includes the only remaining analyst that produces the numbers you are looking at.  It also includes a building inspector.  You don't want developers and prospective business owners passing over San Carlos, because it takes too long to get approvals.  These are bad cuts.

After these 20% cuts, we are going to be back here next year doing this again.  Why?  Public safety expenses are overwhelming the budget.  Police costs are up 30% over the past five years.  Fire costs are up 21.2%.  And no, the police and fire fighters are not greedy.  The city was having a hard time hiring and retaining public safety staff when times were good.  Years of cuts left us unable to compete for public safety labor in the market.  It does not matter as much during a downturn.  But if we don't pay our public safety professionals appropriately, we won't be safe when times are good.  And, eventually, they will be good again.

Now, in my last post I equated our path to that of Vallejo.  In the past five years public safety has risen from 51% to 60% of the city budget.  Under the 20% cut scenario it would be nearly 64% in a year.  Vallejo declared bankruptcy at 70%.  Bankruptcy people.....  That is where our City Manager, Mark Weiss, sees us going without pursuing public safety outsourcing.

So, why is San Carlos so uniquely and profoundly impacted?  For starters, Proposition 13 locked in an unfavorable funding ratio.  The city only gets back 13.2% of every property tax dollar you pay.  It ain't fair, but it ain't changing either.  Proposition 13 isn't going away and can not be amended.  Pigs will fly first (for the purpose of this discussion).

And, our citizens are extremely tax averse.   I am with you on that.  Perhaps our obstinacy will result in the leanest, best run and most pro business town in the area.  But surrounding cities have passed revenue measures.  Maybe they chumps.  But they can pay their public safety professionals at a level commensurate with maintaining adequate staffing.   We cannot.

Why is our public safety so expensive?  Broadly, there are no economies of scale in operating your own police department.  Here is an example.  At any given time, there are only four cops on the beat.  That 1:3 staffing is down from the 1:4 it used to be (commander:officer ratio).  But to make sure that the minimum staffing is maintained 24/7/365, you have to have a bench of officers ready to fill in for vacations, injuries and illnesses.  When you can share that bench of reserves with many cities, your costs go down.  That is an economy of scale.

How about our fire safety.  We share our fire coverage with Belmont.  As a growing city, the original 50/50 cost sharing is slanting increasingly to San Carlos.  But it is the same story, generally.

So, if we cut 20%, the eleventh year in a row, and we are back next year for round 12 of budget cuts, the only place left to cut without compromising public safety or risking crumbling infrastructure will be parks and recreation.  It will be eliminated.

The way I read it, outsourcing public safety will not lead to a degradation of these services.  On the contrary, it  will enhance our public safety.  And the projected savings numbers being offered are conservative.  But this post is overlong already.  Here is our fiscal picture with outsourcing and with 20% cuts.  In one, we start running surpluses.  In the other, we squeak by only to be in the same position next year. 

I will mention that parks and recreation maintenance is going to be outsourced under either proposal and parking meters are likely downtown.

You can see the entire presentation here: Presentation

And you can see a video of the five hour 3/13 budget session here: Video

Parks (& City) in Dire Jeapordy

San Carlos is on track for a Vallejo style bankruptcy within two to five years.  Parks and Recreation is one to two years from elimination IN ITS ENTIRETY.  The proposed 20% budget cuts, if implemented, would, this year, eliminate 5 sworn police officers, close the youth center and leave us with the certainty that we will go through more painful cuts in the coming years, until finally, we would arrive in bankruptcy.  To be clear, Mark Weiss, City Manager, will have no choice but to close Parks and Recreation within one to two years on our present course. 

City Manager Weiss has developed a bold and effective fix.  Public Safety (police and fire) consumes a huge 60% (and growing) portion of the city's budget.  He proposes the 'regionalization' or outsourcing of Public Safety.  We have proposals from the San Mateo County Sheriff's Department and Cal Fire (as well as proposals coming from Redwood City).  To our citizens all would appear the same.  And the intent (which requires confirmation) is that their would be no degradation in response time.  In fact the name on the cars, trucks and uniforms would continue to say San Carlos.  The savings from economies of scale require further investigation but appear large and credible.  And they would eliminate the need for cuts altogether.

I am a HUGE skeptic of government.  I am a rabid (fiscal) conservative.  I have been described as a Hun.  Back in January I dove into city politics. And it has been eye opening.  I can report that your city government is a well run, lean organization.  Your city employees, police and fire are amongst the lowest paid and will shortly be THE lowest paid on the Peninsula.   They do not deserve our ire.

Foes of this proposal made a STRONG showing at the council meeting. 'Parent age citizens' did not. The vehement opposition of the large contingent in attendance was electrically palpable in the room and in their comments. It will be a tragedy if you do not make your voices heard.  I spoke during public comment and directed the city council to view the polls on this site.  Parents, understandably, have a hard time getting out for five hours on a Saturday.  That is parent prime time.  But it will be shameful if we do not make our voices heard.  VOTE IN THE NEW POLL TO THE RIGHT OF THIS SITE.  The city council will be watching.  And then, we need to be in attendance on 3/22 at the next City Council meeting.

NOW IT IS YOUR TIME TO ACT: 3/13 & 3/22 BUDGET MEETINGS

The when and where for the upcoming City Council meetings can be seen here: click here.  This FAQ is meant to arm you with the background information that you need to interpret what will be presented and to offer constructive public comment that can shape council members' votes.

HOW DID WE GET INTO THIS MESS?

San Carlos is facing what is called a structural deficit. In other words, it isn't going away. It has been amplified by the economic downturn, but it will persist even if the economy picks up. The specific cuts that are eventually implemented should be regarded as permanent. City services like our community centers, library, parks and recreation, etc. were expanded during the prosperous 80s and 90s.  We could afford them at the time.  But then the budgets of cities and counties across California were raided by the state government to fund their own structural deficits (and not one a one time basis, permanently). The dot com boom initially masked this unsustainable situation. Soon enough it became clear that we had a problem.

WHY DON'T WE CUT THE FAT BEFORE WE CUT PARKS?

The city has already cut its staff from 126 to 107.  Employees have been furloughed for one week per year for the past six years.  Programs like public safety (police and fire), tutoring, services for special needs kids, intervention for at risk youth and DARE have been eliminated.  Buildings have been shut.  Especially important to me, the maintenance of our athletic fields have been trimmed way back resulting in downright dangerous conditions for our kids playing soccer and little league.  The fact that we have not cut more already is a function of raiding such items as capital maintenance budgets.  You can't do that for long before infrastructure starts crumbling.

OK, WHY DON'T WE RAISE TAXES?

Last fall, Measure U failed to gain passage.  It would have raised the San Carlos sales taxes 1/2%.  Apparently, it wasn't the first attempt either at a revenue measure.  The City Council used capital maintenance budgets as I described above in the hopes of avoiding a disruption in services.  I don't mean to intimate that it was irresponsible to do so.  It just can't be done anymore.  It is not an option to put another measure on the ballot, continue raiding our infrastructure funds and hoping for the best.  We did that already.  We can try again.  I know that I am going to change to a Yes vote.  But for now, it is time to live with what we have.

SO, HOW BAD ARE THE CUTS GOING TO BE?

The city needs to cut roughly $3.5 million from its roughly $35 million budget.  Public safety (police and fire) are already pretty lean and have been the subject of previous cuts.  Did I mention that crime in San Carlos is up over the past year, substantially.  And we are already abusing our mutual aid agreements with neighboring police departments.  That is, we use mutual aid 65% more than we provide it.

So 10% needs to be cut, and each department has been asked to prepare for 10 and 20% budget cut scenarios.  I have been to a few City Council meetings, and council members were clearly signaling that public safety is THE priority.  Read that as Parks and Recreation is going to be cut 20%.  That is $900,000.  Doug Long, the Director of Parks and Recreation ball parked the savings of closing the Youth Center, Crestview Park and either Laureola or Arguello at $600,000.

DUDE, WHERE IS THE HAPPY ENDING?  GIVE ME SOME HOPE....

There have been many ideas offered up by citizens on Facebook and the impromptu Google Doc I created a while back.  But as I have dug into the actual budget, there are really two areas where we can make a big difference.  First, Park Maintenance consumed $1.6 million of the Parks and Recreation budget. $1.1 million is salaries and benefits.  Doug Long guestimated that 'mow and blow' park maintenance consumes $400,000 and that this cost could be cut in half by outsourcing just 'mow and blow.'  Doug is cautious about outsourcing other park maintenance functions for fear of a loss of staff responsiveness and expertise.  Doug admittedly has not had experience outsourcing such services and his caution is based on anecdotal evidence.  I think this is something we need to pursue more strongly.  One previously laid off park worker saved $91,540.  I hate to be cold hearted, but we can get people doing this kind of work for less.  We need to push hard here.  We need to structure the contracts carefully and pick vendors carefully.  But if the alternative is elementary kids not being able to play sports......

Parks and Rec takes in roughly $1.7 million in user fees each year.  You could increase that $200K with a simple 11-12% across the board hike in fees.  And some of the Parks and Rec sponsored activities are at WAY below market prices.  Youth dances cost $5.  Yoga is $12 per class.   Pilates is $7 per class.  You can raise fees here 25% and not hit a speed bump (in my not so humble opinion).  Under the category of user fees I would also include the idea of enabling corporate sponsorships (e.g. The Reading Bug Laureola Park, the Cowabunga Creamery Arguello Park).

Aggressive outsourcing of field maintenance and common sense user fee increases can get us to the $600K that will save the parks and youth center we care so much about.

OK, WHAT DO I SAY AND DO AT THE COUNCIL MEETINGS?

1) Listen:  I am a quick study, but I am new to this. We can all stand to learn more than just what I have laid out here.

2) Comment:  Fill out a yellow speakers card and note the agenda item that you wish to speak on.  Then be ready to use the 2 minutes you get when your name is called.  Here are the points we need to make:

a) The Youth Center as well as Crestview, Laureola and Arguello Parks must not be closed.
b) We need to outsource park maintenance and we need to do it more aggressively than just mow and blow outsourcing.
c) We needs to raise user fees generated by Parks and Rec.  Its fine that parks and recreation charges less than the market rate, but we need to charge more.
d) If money is saved and revenues raised by these measures, the savings need to be used to preserve Parks and Rec operations and not other areas of the city budget.  20% is enough to ask of Parks and Rec.

WHAT SHOULDN'T I SAY?

It is a free country.  Come, learn and say whatever you want.  But some comments are going to be dismissed by City Council as naive.  Comments have accused the city of targeting the services we care about in order to get our attention.  I was inclined to think it as well.  I don't any more.  Some comments have asked why the kids always get cut first.  They haven't been cut first.  My first reaction was that we need to cut the fat.  And that is what cutting park maintenance is all about.  There may be some fat in employee benefits that were expanded to keep city hiring competitive before the economy went south.  I have only so much time to learn so much so fast.  But what I have been surprised to learn is that council members largely seem like good folks and willing to listen.  Assume that they are on your side.  They really seem to be.  Doug Long too, seems like a good guy.  I think he needs a (big) push to be more entrepreneurial.   But he wants a vibrant Parks and Recreation department.

Well, that is my two cents.  Facebook is the great place to add yours.  I may not have the facts 100% right.  I think I am close.  But this works best when we all get involved.

And getting people out en masse to these meetings is going to be critical to making sure that our parks are saved.  Spread the word.  Print the flyer (click here). And hand it out to your neighbors, at parks, at school.  Get to it San Carlos!

MP3 of Meeting with Doug Long (Dir. Parks & Rec)

This morning Debbie Freeman and I met with Doug Long, the San Carlos Director of Parks and Recreation.  Doug graciously allowed me to record the conversation, the MP3 of which can be downloaded here.

Doug Long Interview (mp3).

Here are some of the main points.  I will add to this later....

The Budget Situation: The city has a 'structural' (recurring) $3.5 million deficit.  Parks and Rec has to come up with $900K in repeatable, annual savings. $600K in savings would result from the closure of the Youth Center,  Crestview Park and either Laureola or Arguello Park.

Outsourcing Park Maintenance: The city is looking at outsourcing the lower skill 'mow and blow' aspect of park maintenance.  Mow and blow accounts for $400K and could be cut by 50%, yielding a savings of $200K.  These numbers are still very preliminary.  Doug has never had personal experience working with an outsourced vendor.  But he is cautious about outsourcing more than mow and blow based on anecdotes from colleagues.  I am in favor of encouraging a more aggressive outsourcing policy.  But hear Doug for himself on the MP3.

User Fees:  The city is looking at raising user fees.  Parks and Recreations brings in fees of roughly $1.7 million from camps, classes and the like.  Just a 12% hike in those fees would yield another roughly $200K.

Sports Organizations: AYSO, CYSA & SCLL are discussing ways of funding the parks that they use.

Park Sponsors:  Doug was cool on the idea of corporate park sponsors. His concern is in how you filter appropriate businesses (would you let a liquor store sponsor a park?). 

While this is very encouraging, NONE OF IT WILL ACTUALLY HAPPEN if we don't demonstrate our numbers and repeat our priorities.  There will be many competing voices.  More to come on how to do that soon....

The Budget Numbers

Parks and Rec has a $5.1 M budget (2009-10 adopted), but costs the city a net $3.4 M after user fees (classes, camps, etc.).  This net $3.4 M is roughly 10% of the city's $34.6 operating budget.  Parks and Rec is going to be chopped from 10-20%.

Parks Maintenance jumps out at me.  It is 20% of the parks and recreation budget (30% of the net expense).  The org chart (see below: click to enlarge) is littered with maintenance workers costing $1.1 M.   Doug Long volunteered in his initial presentation that these workers were a bad target for cuts since they are dedicated to the city (unlike an outsourced vendor) and ready to be responsive to urgent city needs.  That sounds to me like they are underutilized.   I want to know how much responsiveness would be lost and how much money saved if we outsourced park maintenance ENTIRELY.  I just have to believe government salary and benefits for always available maintenance workers are FAR above the going rate charged to corporations by private landscaping companies.  We should, at any rate, know the numbers of what could be saved.