7 a.m., Oct. 22
Grand Jury Says City Should Consider Bankruptcy
The 2009/2010 San Diego County Grand Jury today (June 8) released a 22-page report of the City's financial travails. "Presently, the City of San Diego's obligations, liabilities and debts exceed $7 billion," said the report. Also, "It is still untested whether or not the vested rights clause pertaining to pension benefits prevails in bankruptcy proceedings," said the report. (Some claim that pension benefits are set in concrete.) "A Chapter 9 [municipal bankruptcy] filing would result in a federal determination of which fringe benefits and collective bargaining agreements could be restructured." The grand jury suggests that a panel of bankruptcy experts discuss the financial ramifications of a Chapter filing for San Diego.
The grand jury does not recommend the layoffs of City employees. That would result in further erosion of services. The panel estimates that the backlog of deferred maintenance projects is conservatively $1 billion. The report notes that "charging a fee for residential trash collection would save the City approximately $54 million a year." The panel believes there could be savings from consolidation of City and County functions.
This one will be controversial: the grand jury wants the City to explore long term leasing (not sales) of desirable City-owned property to developers, such as parkland in Mission Bay, Balboa Park, Torrey Pines and the Qualcomm Stadium area. My caution to taxpayers: there is often little difference between a sale and a long term lease.
More like this:
- Bankruptcy — Good for San Diego — Dec. 1, 2010
- Believe the Grand Jury. Do NOT Believe the Mayor's Office — Nov. 18, 2010
- When Governments Cut Spending, It's Citizens, not Bureaurats, Who Suffer — June 16, 2010
- Hide the Pea, Bury the Head — Jan. 4, 2007
- Our Enron-Style Scandal — Feb. 5, 2004