MOUNTAIN VIEW
– A parade of city leaders from around the South Bay – including
several from Gilroy – challenged and pleaded with their state
legislators Monday to avoid balancing the troubled state budget on
the backs of local government.
MOUNTAIN VIEW – A parade of city leaders from around the South Bay – including several from Gilroy – challenged and pleaded with their state legislators Monday to avoid balancing the troubled state budget on the backs of local government.
Although their thoughts on the source and solution to the budget crisis sometimes differed, city councilmembers and staffers from Gilroy and their counterparts from Morgan Hill, San Jose, Campbell and Los Altos seemed to agree on one thing: they would suffer mightily – and disproportionately – if legislators approved Gov. Gray Davis’ plans to close a $35 billion shortfall.
“We didn’t create this problem,” Gilroy Mayor Tom Springer told a group of state legislators during a special budget workshop in Mountain View. “And just because we’re at the low end of the food chain doesn’t mean you can dump it on us.”
Gilroy councilmembers rescheduled two meetings in order to attend the workshop, which was sponsored by the League of California Cities and the Santa Clara County Cities Association. State Assemblyman Simon Salinas (D-Salinas), Manny Diaz (D-San Jose) and a representative from the office of state Senator Bruce McPherson (R-Santa Cruz) attended the event.
To the horror of city and county officials across the state, Davis’ plan to balance the budget includes a proposal to strip local governments of $4.2 billion in key funding over the next 17 months by taking away money that is given to cities and counties to help cover revenues they lost when the state lowered vehicle license fees.
Davis’ $96.4 billion budget also includes more than $20 billion in spending and program cuts this year and next, $8.3 billion in tax increases, hundreds of state layoffs and a shift of some social and health services to counties.
But if the proposal to take away the VLF “backfill” stands, Gilroy officials say the city budget could lose roughly $1 million in revenues in coming months and another $2.4 million in the 2003-04 budget that begins in July.
That’s a hit as big as losing revenues from the city’s auto row or the Gilroy Premium Outlets – and one that officials told the assembled legislators will almost certainly translate into impacts on city programs and services.
“Taking away this money will devastate us,” Springer told the legislators Monday. “It threatens all of our city services.”
For example, losing $1 million in revenue is equivalent to the amount of money the city spends on parks programs in a given year, Springer told legislators. A cut that large could easily jeopardize the whole program, he said.
“We might as well close everything down,” he said.
Meanwhile, property taxes already fail to cover cities’ costs for accommodating new housing growth – especially affordable housing, Springer said. Hitting cities with the VLF takeaway would further rob their incentive to build, he warned.
“Why should we build another home, especially an affordable home, when it drains our city budget and you take away (funds) we use to keep ourselves whole?” he asked. “Why shouldn’t we just grind to a halt?”
Distrust was another theme at the meeting. Like other officials, Springer noted that the state already hit local governments hard with revenue shifts in the early 1990s – and had since promised not to take away the VLF money.
“If that promise cannot be made and kept, how can we believe anything else you’re going to tell us?” Springer asked.
Salinas, who is chairman of the Assembly’s local government committee, agreed Monday that local governments seem to take a disproportionate share of the wrath from Davis’ plan.
“The only thing I support in concept is that (Davis) recognizes we are not going to do it all with cuts and we’re not going to do it all with taxes – it’s going to be a combination,” he said in an interview. “Conceptually I support that. What else he has in there, I have some concerns about – and the VLF is one of them.”
Salinas told leaders at the hearing he would pass their messages along to state leaders and fight to keep their concerns about the VLF issue “on the table.”
But he also warned that local leaders would have to be proactive and work together on a solution they could throw their weight behind – a task he agreed will be difficult within the spread of competing budgetary and political interests.
“Obviously if we want to propose something different, we do it,” he said. “But will it work, and do we have enough political support for it?”
The difficulty of the task was obvious Monday, when local government officials had different ideas on how to combat the budget problems – even within individual governments.
For example, Springer echoed several councilmembers from other cities in urging the state to repeal or delay legislation – such as certain worker’s compensation provisions – that hurt businesses – especially local businesses – in order to help right the economy.
“(Small businesses) are the engine that needs to be restarted,” he said.
Springer, a Republican, also said raising sales tax would not give consumers an incentive to spend.
“It doesn’t work that way,” he said.
But fellow Councilman Peter Arellano, who also took the microphone, said targeting worker’s comp or health insurance provisions would mean that local government would just have to bear the costs of caring for workers.
He suggested the state look to the correctional system – which he called “untouched” – for savings, as well as to alcohol and guns for potential sources of revenues.
“Start thinking of alcohol,” he said. “Start thinking of how many gunshot wounds we take care of in (county) emergency rooms. … It needs to be equal all the way around.”
