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Uploaded: Sunday, May 10, 2009, 2:54 PM
Palo Alto could lose $2.43 million to state
State Department of Finance proposes to borrow local property and sales taxes to ease California's budget crisis
Listen to the Palo Alto City Council meeting live when the council is in session (usually Monday nights at 7 p.m.) via the KZSU Webcast. |
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by Jocelyn Dong
Palo Alto Online Staff
Already facing a $10 million budget shortfall in the coming fiscal year, the City of Palo Alto may be forced to let the state borrow $2.43 million as of July 1, if Gov. Arnold Schwarzenegger and the state legislature approve a plan released last Tuesday.
The proposal by the state Department of Finance is an attempt to raise $2 billion to help close the state's yawning budget deficit.
The Palo Alto City Council will vote Monday night whether to try to fend off the state's financial advances by declaring its opposition to the Department of Finance plan.
The state proposal calls for the governor to suspend 2004's Proposition 1A, which protects local funds from being used by the state, and to borrow 8 percent of local property-tax revenues, plus one-quarter of one percent of the city's sales taxes (known as a city's "triple flip" allocation). The state would have to pay back the borrowed money within three years, with interest, according to the state Constitution.
City Manager James Keene is calling the state proposal "fiscally irresponsible."
"Financing the state budget deficit with borrowing from local governments will only deepen the state's structural deficit," Keene stated in a city manager's report. "The state must figure out a method for balancing the budget using its own resources."
Keene identified numerous measures the city might take if the state proceeds with its plan: eliminating the police department's traffic team and school resource-officer program; eliminating the Office of Emergency Services; ending the city's shuttle service; eliminating its tree-trimming contract; reducing the police department's crime-analysis program and community policing/outreach program; and contracting out park and golf maintenance programs.
Twenty-one city positions could be eliminated as a result, the city manager's report states.
Beyond Palo Alto, the state plan would borrow $68 million from Los Angeles, $62 million fro San Francisco, nearly $13 million from San Jose, and $3 million from Fremont, along with other cities, counties and special districts affected.
In order for the state plan to take effect, the California Constitution requires the governor to declare a "severe fiscal hardship" and the legislature to suspend Proposition 1A and pass a bill that would specify how the state would pay interest to local governments.
Also on Monday night, the council will hold its annual meeting with Rep. Anna Eshoo (D_Palo Alto). High-speed rail, federal stimulus funds, and the environment and transportation are among the topics that could be discussed.
The meeting with Eshoo is scheduled for 5:30 p.m. on Monday in the Council Conference Room in City Hall (250 Hamilton Ave.), to be followed by a study session with the Utilities Advisory Commission regarding the city's potential Smart Grid program at about 6:30 p.m. At 7:30 p.m., the council will move to Council Chambers for its regular meeting.
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Posted by Hank, a resident of the Old Palo Alto neighborhood, on May 10, 2009 at 10:18 pm Starving the beast. It's about time.
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Posted by pat, a resident of the Midtown neighborhood, on May 11, 2009 at 9:26 am “Keene identified numerous measures the city might take….”
Why does Keene mention so many items related to the police? Is this a scare tactic?
There are many low priority items – not relating to public safety – that could be cut, e.g., Children’s Theater (would save $1M/year), Jr. Museum and Zoo, public art purchases …
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Posted by Marvin, a resident of the Charleston Gardens neighborhood, on May 11, 2009 at 9:54 am the line I found amusing in the story is:
"City Manager James Keene is calling the state proposal "fiscally irresponsible." "
Has Keene looked at the "fiscal responsibility" exercised by our City council??
I agree with Pat that focusing on police related expenditures is a scare tactic. Why not mention the items that Pat mentioned above, as well as cutting back bonuses to all city employees that just show up for work, cutting the Senior Games donation, eliminating Drekmeier's proposed environmental coordinator position, cut expenses for "destination Palo Alto", cut travel to conferences like the one Klein and Keene were just at. There is a big list of non-essential items that can be cut.
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Posted by Kate, a resident of the Duveneck/St. Francis neighborhood, on May 11, 2009 at 10:05 am To: Pat- Midtown.....
You have been vocally on the case of the Children's Theater, the Museum, and the Zoo.
From what I've heard, you don't have children - and you've already moved to Los Altos. Find another fight to pick. Los Altos has problems - plenty for you to do there. There is a lot of places to save money - like subsidizing Frank Benest's cushy living arrangements with the city, the provision of a plush home for the current city manager who gets unbelievable perks, cutting back on benefits, finding a substitute vendor to replace the flawed SAP contract which is over cost and under performing, reorganizing the Public Works Department, and cutting by at least one-fourth the staff at City Hall. That's for starters. And yes, the public art of questionable taste would be another place for deep cuts - color of green, ugly 3-dimensional 'statues'. Not the shuttle.The shuttle is a life line. The street trees don't belong to the residents, neither do the sidewalks. Election is in November. Bring it on.
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Posted by Marvin, a resident of the Charleston Gardens neighborhood, on May 11, 2009 at 10:10 am Sorry, Kate, I agree with Pat--the Children's Theatre, Museum and Zoo are perfect targets for cost cutting, especially considering the fiscal irresponsibility of the CT staff that was exposed last year.
BTW where do you get your info about Pat, her family status and where she is living?
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Posted by David, a resident of the Midtown neighborhood, on May 11, 2009 at 10:56 am The City's sidewalk repair program is overblown, with many segments of sidewalk unnecessarily replaced. Example: recent work on Ross south of Loma Verde and nearby streets. While some work was obviously needed (vertical separations resulting in trip hazard), much of the work was not necessary for pedestrian safety, especially in the current economic climate.
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Posted by mutti, a resident of the Adobe-Meadows neighborhood, on May 11, 2009 at 10:59 am Even if all the measures pass on May 19, California still won't have a balanced budget. It needs to cut services and raise revenues both! Borrowing from the schools, the lottery, and now cities isn't going to do anything put push CA further over the edge in 3-5 years. No family can live this way. It's time to cut the borrowing and live on the "true" revenues. Arnie said in 2004 his borrowing was a "one-time deal." Now he's saying "I'll be back." Send him to the movies.
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Posted by J, a resident of Another Palo Alto neighborhood, on May 11, 2009 at 12:48 pm It's amazing. Stanford today announces cutting *$250M* from its budget in addition to the 15% cut announced earlier and the City suggests mickey mouse changes or uses scare tactics. If we benchmarked ourselves against other cities we'd find everything cited above and a whole lot more. I'm surprised the Weekly doesn't blow the whistle more often. But come November there'll be some changes....
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Posted by Kecvin, a resident of the Ventura neighborhood, on May 11, 2009 at 2:29 pm There is no way we any city would ever see that money again! Payback within 3 years? Like all of a sudden in 3 years we will have no budget problems? We will never have enough money to support all the things of interest on the State level. Or City level. Every time we have any surplus of funds, someone wants to finally start their pet project and claims grandfather status when funds get tight the next couple of years. We need to get back to basics and basic needs!
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Posted by pat, a resident of the Midtown neighborhood, on May 11, 2009 at 3:13 pm The city budget page says: "The budget of the City of Palo is a reflection of the City policies, goals,and priorities." Web Link
Theoretically, "the City" is its residents.
The proposed budget for 2010 - 2011 is at: Web Link
The mission statement says: The government of the City of Palo Alto exists to promote and sustain a superior quality of life in Palo Alto. In partnership with the community, our goal is to deliver cost-effective services in a personal, responsive, and innovative manner.
You won't find any actual numbers until page 27 (pdf p. 53).
It would be an interesting exercise to look at the budget and make your own revisions to balance the budget. Maybe start with the org charts for each department. Then send your suggestions to the city council and city manager.
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Posted by Bill, a resident of another community, on May 11, 2009 at 3:48 pm Wow, the Pat of Midtown who has been a critic of Palo Alto City government is now living in Los Altos!? Has that been confirmed? If so, why the continued opinions?
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Posted by Marvin, a resident of the Charleston Gardens neighborhood, on May 11, 2009 at 4:06 pm Bill--I posted that question to Kate, who initially said that Pat is living in Los Altos now, as to where she got her info from. So far, no reply. Therefore, I would not take it as the gospel truth that Pat no longer lives in PA.
But anyway, does someone have to live in PA to offer an opinion?
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Posted by pat, a resident of the Midtown neighborhood, on May 11, 2009 at 4:34 pm Yes, I moved to Los Altos last month. I still own property and pay taxes in Palo Alto.
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Posted by Looking to move, a resident of the Duveneck/St. Francis neighborhood, on May 11, 2009 at 5:56 pm Pat:
How much are your Palo Alto property taxes?
Did you rent your Palo property to a family with school age children?
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Posted by Winston, a resident of another community, on May 11, 2009 at 8:52 pm Pat, run for Los Altos Council on a tight fiscal conservative platform.
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Posted by wow, a resident of the Barron Park neighborhood, on May 12, 2009 at 10:59 am I want to echo Marvelous Marvin's comments:
"But anyway, does someone have to live in PA to offer an opinion?"
This is a public forum and there is no residence-eligibility requirment to state an opinion. This isn't Foothill Park.
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Posted by musical, a resident of the Palo Verde neighborhood, on May 12, 2009 at 1:04 pm Yes, while this is indeed a public forum, an accurate identification of one's "resident of" neighborhood does help us understand where an opinion or statement is coming from. "Terms Of Use" say be truthful. I suspect just about everyone who posts can honestly say "I live or work here or nearby, I pay taxes here, I spend money here, I deserve a say here, and I vote."
So, back to the headline: "Palo Alto could lose $2.43 million to state" should say "temporarily lose". What interest rate will the state pay us?
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Posted by Anna, a resident of the Downtown North neighborhood, on May 12, 2009 at 2:21 pm So what if Pat was lucky enough to be able to move somewhere else? She owns property here, and is every bit as much affected by the loony city government as the rest of us. I think it's admirable in the extreme that she wants to stay involved in the civic affairs of Palo Alto.
If other property owners - absentee and otherwise - were as concerned and involved as pat of Midtown, maybe our government would be better run.
And anyway I think pat's commentary here are among the most insightful and informative. She'd be a real loss to this forum.
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Posted by Deep Throat, a resident of another community, on May 13, 2009 at 11:43 am Pat lived in Palo Alto next door to Deputy City Manager Steve Emslie.
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Posted by Parent, a resident of Another Palo Alto neighborhood, on May 13, 2009 at 11:50 am I lived briefly in San Jose - they make residents pay for sidewalk repairs - even if its the city owned trees that do the damage. Palo Alto can probably find ways to cut without impacting police.
But the real issue is State of California now stealing from our local governmetns to pay their bills. And what are they buying? Well, HIGH SPEED RAIL of course, because fast trains to Disneyland - that's what we need most right now.
High Speed Trains, and Low Speed Schools (New Califorinia State Motto, they're going to have it embroidered right under the bear on all the state flags)
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