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— He doesn't understand how Sanders can insist he is not pondering a tax increase or bankruptcy. "If this were his personal finances, he would have to do one or the other: either increase his income or file for bankruptcy," says Ehrlich. He doesn't know whether Sanders plans to dump assets and then go into the tank, but the professor does say, "Never sell capital assets to pay off debt." And, he adds, "A really long-term lease is no different than disposing of the property."

Councilmember Donna Frye agrees that there is too much dirty linen on the line to dismiss higher taxes or bankruptcy. "I don't know how they are going to do it. It's unrealistic," says Frye. She notes that the five-year plan is misleading: "Nobody wants to tell the public how bad things are. We have over half a billion dollars' worth of non-public-safety unfunded needs as of August of 2004 that I didn't see anywhere in the five-year plan."

In its ongoing shell game, the City is still hiding the pea from the public. The announced annual required contribution to the pension fund is questionable. The public deserves to know "not just the number we can get away with, but the real one, with all the contingent liabilities -- how much it is for this year but also for the years thereafter until it's paid," says Frye.

Activist Mel Shapiro thinks voters might resist most tax increases but could be persuaded to go for raising the transient occupancy tax, or hotel room tax. The tourist industry mobilized to defeat it in fall of 2004, but the public is now more aware of the City's dire straits. San Diego's hotel tax is only 10.5 percent, lowest among California's major tourism destinations. (The rate is 15 percent in Anaheim and 14 in San Francisco and Los Angeles.)

Both Shapiro and Frye say there is money to be picked up from the redevelopment agencies, such as Centre City Development Corporation. The agencies owe the City $200 million, and "at least $20 million is unrestricted and could be spent now, without restrictions," says Frye.

Shapiro thinks Damashek's scenario "is a possibility, although if he [Sanders] raises money through lease or sale of assets, it may not be necessary to go bankrupt," he says.

Scott Barnett, president of TaxpayersAdvocate.org, thinks the budget can be balanced over time without bankruptcy and maybe without a tax increase. But fat sewer- and water-fee increases are already in the works, and the storm-water fee will have to go up, he says. He is counting on the City getting back to the capital markets and selling half a billion dollars of infrastructure bonds. And he does think a hotel-tax boost might go through if it were earmarked for infrastructure -- not pensions. Bankruptcy "won't undo the pension problem and won't undo debt service," says Barnett. He is counting on asset sales, leases, and privatization -- for example, giving a long-term lease to a company to operate Torrey Pines golf courses.

Of course, there's another alternative that might fit with the San Diego mentality: let the joint rot and hope nobody notices.

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