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Guest Opinion: Why next year's city budget will break your heart

Original post made on May 1, 2020

Because of the pandemic, the city of Palo Alto will see sales and hotel taxes go down by tens of millions of dollars next fiscal year. That means hard choices will need to be made about the programs and services that it can offer.

Read the full story here Web Link posted Friday, May 1, 2020, 6:37 AM

Comments (71)

32 people like this
Posted by George
a resident of Old Palo Alto
on May 1, 2020 at 7:56 am

If we haven't already, we will soon understand that wholesale shutdown was a really, really, really bad idea. Public officials jumped too quickly and too far in this lockdown without the ongoing validation to justify such widespread controls. I agree with Elon, state and county officials went too far in taking people's freedom.
It's certainly true that it was scary in the beginning. Had it spread as first feared and caused as much death as first predicted we would be in a very different place but the worst didn't happen. Typically, officials were slow - they continued to cite worst case models as justification for extending controls and suspending constitutional rights. As it turns out, the data isn't there to justify their actions. And yet the shut downs and closures continue.
People, as it turned out, are capable of acting responsibly - they adapt and change behaviors to safeguard themselves.

Public officials have destroyed almost half the economy and the shut downs continue. We most certainly have learned - or will learn - that we have to deal with the virus and keep the economy going at the same time. People will differ but the toll this shutdown takes on everything might be a cure that is much worse than the illness.

Palo Alto should cut to the bone, reduce staff - especially the non-essential social behavior advocates - close it's libraries (or charge for entry), declare emergency reductions in it's pension obligations, etc. - take a sharp pencil to it's budget because that's what many of it's citizens and businesses are forced to do. The citizens and local businesses can't pass on their losses by enacting new fees and taxes. The city has to trim waste and fluff. Like it or not, the city, county, and state own the shortages, lack of preparedness, the huge errors in estimates, the administrative panic, the stoppage of business, and now, the deficits caused by the above. The people did not shut the economy down and should not be forced to pay for it.

Officials should have had reserves and supplies and plans but apparently, at just about every level, they didn't. It's a big mess that should never happen again.


71 people like this
Posted by Idn't You Overlook Something?
a resident of Crescent Park
on May 1, 2020 at 8:18 am

Why no mention of asking city employees to take a temporary salary cut, especially those earning over $100,000? That's better in the long run than laying some of them off, which most of the ideas above would precipitate.

At a time when so many are being truly heroic, it's puzzling that the editorial steers the conversation away from asking our better-paid city employees to share in the burden.


19 people like this
Posted by Resident
a resident of Another Palo Alto neighborhood
on May 1, 2020 at 9:02 am

The City has to decide what is completely necessary expenditure and what is frivolous.

For example, anything to do with making changes to roads that are working well should be scrapped. City landscaping projects should be scrapped although watering any landscaping already planted should continue. Maintenance at City parks should continue, but any improvements should be delayed. Encouraging small businesses particularly businesses that serve the public (residents) should be encouraged. We should be encouraged to spend in Palo Alto rather than neighboring cities or online. Opening up any type of service business should be a priority so that not only the business survives, but that sales tax can be generated as soon as possible. We can't suddenly invent some big box stores in Palo Alto, but any type of retail enterprise that is providing affordable household items, children's clothing, etc. that everyone needs should also be encouraged.

Palo Alto has done a lot to make it upscale and a cut above the rest, that image is now going to come back and haunt us.


13 people like this
Posted by Perspective
a resident of Midtown
on May 1, 2020 at 9:43 am

There are many things these days that are breaking my heart. The prospect of fewer hours at libraries is not one of them.

Let's pick ourselves up, brush ourselves off, makes do with what we have, and help everyone around us to make our town and the world a better place.


11 people like this
Posted by musical
a resident of Palo Verde
on May 1, 2020 at 9:57 am

All my disposable income has been disposed.


56 people like this
Posted by Sally
a resident of Downtown North
on May 1, 2020 at 10:07 am

Is there any chance this council is nuanced enough to cut smart? With wise and bold management, downturns like this can be an opportunity to shed off massive loads bureaucratic chaff and build a leaner, meaner machine.

Cuts to community programs (not just "must have" services) should be avoided whenever possible. One can take opportunities like this to force departments into doing more with less. Every department will say, "Cut one penny, and your favorite things disappear!" Council needs to call out that nonsense, and get into the weeds to manage the cuts with care and nuance. The council should not and cannot trust the CMO or the departments themselves with this job. Council cannot just okay whichever of the two proposals presented to them by each department.

City Council -- Please don't try to do this by cutting loads of programs that cost $40k each. Save money, but don't gut what makes Palo Alto worth living in. Look for the sick elephants, even when it's hard and under-performing personnel may be implicated.

Reductions of this sort should entail massive restructuring, not a massive butchery job. Are we bold and nuanced enough to cut smart?


39 people like this
Posted by Fiscal Oversights
a resident of Crescent Park
on May 1, 2020 at 10:10 am

In addition to pay cuts and/or lay-offs...trim retirement benefits as well.


35 people like this
Posted by Frank
a resident of Downtown North
on May 1, 2020 at 10:37 am

I know the natural temptation when things are going poorly and we are desperate for an explanation, is to blame others. But I laughed when I read the suggestion that city workers making more than $100k take a pay cut. Who do we expect to work here? And where would they live? We’re already complaining about the RVs.

The median income in Palo Alto was close to $150K according to the 2010 census (surely much higher in 2020, not withstanding COVID-19). The median home price is $3M+. The average rent for an apartment is almost $4K.

My wife and I, like many of our friends, are lucky. We bought our modest house decades ago before the property values went nuts. And, yes, I never made $100K while I was working. But that was when HP was king, Cubberley was a high school, and Zuckerberg wasn’t even born yet!

If there are people who are overpaid versus what they’d make someplace comparable (Mountain View, Menlo Park, etc), or positions that are truly unneeded, I’m all for budget efficiency. But it seems rather silly to me for those of us who live in one of the wealthiest areas in the country, to bemoan the already below-median pay of city workers.

Shouldn’t we have a rainy day fund? If we don’t, we definitely should after this!


31 people like this
Posted by PhilB
a resident of St. Claire Gardens
on May 1, 2020 at 10:40 am

@George, So you think that shutdowns were too soon/too much? Then consider what has happened in New York City and area, where shutdown orders were delayed.


13 people like this
Posted by TimR
a resident of Downtown North
on May 1, 2020 at 10:46 am

With the influx of vagrants and all the closed businesses, downtown already looks and feels like some kind of poor, sad, depressed city whose glory days are behind it. And while it won't stay that way forever, and things will recover, it won't bounce back immediately after all the current economic restrictions are lifted. Austerity is never a pretty thing, but it will be our short and medium term "new normal."


63 people like this
Posted by Online Name
a resident of Embarcadero Oaks/Leland
on May 1, 2020 at 10:47 am

The cuts don't break my heart; the waste and spending and virtue signaling infuriate me. I can't believe that former Mayor Kniss said that "charity begins at home" when saying there will be no layoffs for city employees who will STILL get raises while the taxpayers (businesses and people) are suffering financial losses.

Remind me again about how much the cost-overruns and delays for the Mitchell Park Library cost.

Evidently this "charity" is more important than the unfunded pension liabilities and providing cost-effective services. Just skim the salary tables for PA!

PA Utilities has been running a $20.000.000 "surplus" each year for several years because they're over-charging us to funnel our money into the general fund. To make matters worse, the city spends money defending this practice against citizen lawsuits.

Re hotel taxes, the city approved all the new upscale hotels to feed the budget and pay its army of consultants obviously forgetting about recent downturns like the Bush Recession, the Dot.Bomb crash etc etc. while displacing long-time residents of the President Hotel and small businesses.

Speaking of the hotels, other cities have moved to house the homeless, the displaced, the families of Stanford Hospital patients in hotels. Where's the Palo Alto leadership?

Maybe instead of the constant push to "revitalize" downtown, densify everything and pay commuters' expenses, we could just get back to basics.
No more wasteful spending on "road furniture" and consultants to tell us we really love all the traffic calming like Ross Road when we don't.

If you're going to waste time passing "anti-idling" regulations, at least make some money and start ticketing the idlers.


44 people like this
Posted by Sally
a resident of Downtown North
on May 1, 2020 at 10:49 am

Ms. Cormack -- Why no mention of the general fund emergency reserve? Don't we have something like $40m there for situations exactly like this.

Please correct me if that is incorrect or imprecise.

If this isn't an emergency, to dip into that and rebuild over the coming years, what is?

We still need to cut and cut smart (see my comment above), but let's put all the cards up on the table.


3 people like this
Posted by NeilsonBuchanan
a resident of Downtown North
on May 1, 2020 at 10:52 am

Dear Resident,

Many nearby cities probably will adopt "shop locally" efforts. This cuts both ways especially if Palo Alto sales tax revenue depends too heavily on shoppers from other cities.

Just sayin'..... we citizens and our council have to be careful what we wish for. So far I think city staff has laid out a reasonable. preliminary format for difficult decisions.

My only reservation is that the staff reports are not openly addressing the psychology or consumer behavior in key areas such as hotel use, travel, spending on larger consumer goods and public transit. Forecasting these variables is reasonably feasible if you can think in terms of every 6 months and restate forecasts when human behaviors are more certain.


21 people like this
Posted by Pied Piper
a resident of Community Center
on May 1, 2020 at 11:24 am

@George

>> If we haven't already, we will soon understand that wholesale shutdown was a really, really, really bad idea.

Totally agree -- with the caveat that the only worse idea would have been to NOT shutdown.

>> Public officials jumped too quickly and too far in this lockdown without the ongoing validation to justify such widespread controls.

Again agree -- with the caveat that if they hadn't done so, people in the peanut gallery -- George could be one -- would have criticized them for not acting quickly enough.

>> I agree with Elon, state and county officials went too far in taking people's freedom.

Again agree. The only thing worse would have been taking their freedom -- forever.

In short, GET REAL.


27 people like this
Posted by Dan
a resident of Old Palo Alto
on May 1, 2020 at 11:59 am

This is a tough situation for everyone, in one way or another, and the city has to address it by making tough decisions. Hopefully they are well thought out and not just influenced by the loudest voice. One idea that I think is fairly easy right now is to cancel/postpone the multi-million dollar bike bridge over 101 near San Antonio. I rode through the current tunnel yesterday and it is still functional and for a majority of the year it works fine. Until we HAVE THE MONEY (which isn't now), it should be shelved. I hope that happens. We can do so much better right now with that money.


8 people like this
Posted by Member
a resident of Another Palo Alto neighborhood
on May 1, 2020 at 12:08 pm

Alison - there are many financing options available to the city to weather the storm: bonds, reserves, intern fund loans, etc. I am sure city employees have all of the options readily available to review with City Council. Please do not cause panic in a city such as Palo Alto, the Birthplace of Silicon Valley. We are poised return to "normal" sooner than another community in the USA. With Stanford University, SRP, Stanford Mall, several hospitals, downtown, cal ave., the VC community and the list of our treasures can go on, the economy will return to normal sooner than you think. Then City Council will be back to containing growth through the land use process. People are tired of being locked up. They will return to all of the business areas to see other people. Stay focused on smart land use decision (speed it up too) to grow the sale tax base - providing services households need, increase housing supply, improving road conditions/safety and increasing walk-ability and bike paths. Find the money we need. We are a AAA bond rated city. Money is the not the problem in Palo Alto; it's the slow land use decision making process that impacts the city's bottom line. Also, please find a way to increase support for PAUSD. We need our kids to go back to school. Thank you for volunteering to serve our city.


15 people like this
Posted by Mark Weiss
a resident of Downtown North
on May 1, 2020 at 1:22 pm

Instead of canceling the May Fete parade or closing the libraries, why don’t we impose a one time special tax on the owners of the hundred or more buildings that the parade passes on University and downtown? Or tax the last 20 or so buildings to change hands or be redeveloped. The Visa building near California Avenue was recently flipped for $138 million —what’s our share?
We gave away a public zoned parking lot to a developer at the corner of Page Mill and El Camino —let’s tax him.


1 person likes this
Posted by Mark Weiss
a resident of Downtown North
on May 1, 2020 at 1:28 pm

Web Link

There’s a huge section of our community that the covid crisis merely means take out versus dining out...


10 people like this
Posted by Scrooged
a resident of Duveneck/St. Francis
on May 1, 2020 at 2:02 pm

Cuts “ like the Chili Cookoff and May Fete Parade and holiday tree lighting ceremony; “. Community gatherings which bring us together, stronger. Maybe you mean cutting large gatherings because of COVID spread ??? If not. This is just plain Scrooge like - ghost of Palo Alto past, present and future. Mr Shakada please take a voluntary cut in pay, mobilize a massive volunteer force like in WWII times, Council refuse your stipend for symbolic reasons — Cutting 3rd grade bike rodeos!? Absurd. Again teaching good sustainable ways to safely get around saves futures on energy and transportation. Please again what stick are you using to cut into ?


22 people like this
Posted by Another Giveaway
a resident of Another Palo Alto neighborhood
on May 1, 2020 at 2:42 pm

Heartbreak and hope.

I hope the new fiscal reality will force the city to cut all of developer giveaways and all of the planning and transportation boondoggles they have in the works to subsidize real-estate developers and wealthy absentee landlords.


32 people like this
Posted by Jonathan Brown
a resident of Ventura
on May 1, 2020 at 3:24 pm

Salaries and benefits are the biggest City expense item, so that's a glaring hole in the picture painted by Councilwoman Cormack. When cuts need to be made, the usual practice is to look at the big ticket items first, not the small stuff like bike rodeos (and what exactly is the City paying for in connection with those? parents of schoolchildren are always fundraising to put them on.). Surely there are some of the more than 1000 City employees and/or consultants and contractors whose services and expenses can be cut. Can the City find ways to cut expenses that are related to those portions of revenue that will disappear due to the COID-19 crisis? Can people that work on matters that can't be done right now, like helping to coordinate events with large gatherings that are banned, be furloughed or redeployed to save resources? Cuts will be needed, but this article gives no confidence that the City will be prioritizing them in any logical way. Hopefully the process can be more transparent as we move along.


Posted by Jen
a resident of Barron Park

on May 1, 2020 at 3:32 pm

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35 people like this
Posted by Anon
a resident of Another Palo Alto neighborhood
on May 1, 2020 at 3:33 pm

This discussion is always depressing. A look at one of the websites for salaries of public employees, such as this one: Web Link always shows that top public safety salaries can be extremely high. For example, in 2018, the third-highest-paid employee compensation, including total pay and benefits, was $425,533.91. That was a "Battalion Chief", and was higher than the department heads of either Police or Fire Department. In 2018, 69 people made over $300K. If you look at the bottom of full time employees, that group is making what looks like $30K a year, and includes, for example, some librarians.

Yes, we need police and fire protection. But, do I want to lay off every librarian so that some of the folks making over $300K don't have to take a pay cut? No. And no, I don't have anything against fire and police folks. But, the city is paying unsustainable compensation.

Now, there are some folks perhaps most of us here could agree to lay off -- all the people who process developer's paperwork. We don't need a single square foot of new office space in this town, so, we should be able to lay off whole sections there. But, we do need libraries and parks, and, one Battalion Chief costs as much as ten parks and rec and library folks at the bottom of the scale.


20 people like this
Posted by Safety First Priority
a resident of Another Palo Alto neighborhood
on May 1, 2020 at 3:44 pm

These are the wages of the City spending so many years serving corporations and workers who don't even live here or pay taxes here and treating residents like they are inconveniences.

The Weekly published an analysis not that long ago that showed how much money the residents were spending to underwrite the development projects by big developers through the planning office. That needs to be stopped.

It might be an advantage to keep libraries open because they are community centers and as such, can be gathering places with smaller crowds if all are open instead of two. As the weather heats up, they may be important for keeping some of our elderly residents cool and healthy.

We are home to the greatest concentration of billionaires -- surely, some of them must be doing well enough to consider ensuring that community gems like the Junior Museum and the incredible staff there can continue serving the children of this are as things open up. Especially since some of the unique vulnerabilities, like the hotel monoculture that sprouted on the south side of town for their needs mostly has made our local economy so vulnerable in a slowdown (not just this one).

The City spent many years neglecting small businesses that would now be doing well and essential for recovery, that have now left Palo Alto. Too many resident-serving businesses are gyms for day workers. I haven't gone downtown to eat for years because of the traffic and office-park feel, and now I no longer have a relationship with the restaurants to even consider getting takeout. The two businesses I have a strong enough relationship with that I have considered trying to help by just giving the workers gifts are not even in Palo Alto.

When things are good, Palo Alto should be buying up the real estate in the downtown and major retail areas and long-term leasing the land or even the land and buildings to businesses that benefit residents and pay their workers well (which the City can enable by reducing rents -- something that can happen more and more over the years as the stabilized land prices will become more and more valuable over time).

In an inevitable future bust cycle, this would help stabilize the costs for those businesses -- if the city had done this even 10 years ago on CA Ave and Midtown (which was sold within the last 10 years), those businesses and their workers would be fine, and able to pivot in ways that allow residents to keep their sales taxes in Palo Alto. But no, we wouldn't want to do anything for the ordinary residents of Palo Alto.

Cut the bike bridge. Cut the stupid road furniture projects. Cut traffic demand management and other things that aren't necessary as long as workers can't crowd into offices -- in fact, maybe make and ordinance that prevents that into the future. Cut putting meters downtown.

Start a donation drive to protect civic assets that actually serve residents and to expand them so that our youth are protected in the coming difficult seasons, and our city meetings can go for the foreseeable future online, be two-way, and reach more people.

Start now to figure out how the City diversifies and protects small, resident-serving businesses, because those will ultimately be more stable and resilient in economic downturns, especially if the business owners are part of the community.

Safety must come first.



10 people like this
Posted by Safety First priority
a resident of Another Palo Alto neighborhood
on May 1, 2020 at 3:47 pm

>Too many resident-serving businesses are gyms for day workers.

Sorry, somehow a line got deleted,

Too many resident-serving businesses have been pushed out, too many shop fronts are now gyms for day workers.


3 people like this
Posted by What Will They Do Next
a resident of Old Palo Alto
on May 1, 2020 at 4:13 pm

@ Pied Piper .... you make me laugh. Thanks. I am so looking forward to people getting real (that means you).


34 people like this
Posted by Online Name
a resident of Embarcadero Oaks/Leland
on May 1, 2020 at 7:47 pm

One of the local papers (apologies for forgetting which) recently published an article mentioning 3 average salaries that stuck in my mind: $83,000 for librarians, $114,000 for cement finishers (???) and $241,000 for police.

Given those differences, threatening to cut libraries seems counter-productive but typical of the usual scare tactics politicians use: threatening cuts the most visible and popular services that offer the least savings while ignoring the real waste. Instead of cutting the new traffic enforcement detail, let them start ticketing and raise some money!Just follow every FEDEX truck and ticket them for double-parking and idling!

Think of all the taxpayer-funded trips for our politicians and managers: several (a minimum of 3 people jetting off to Europe and Asia to visit our "sister" cities, several City Council members and department heads flying to DC to talk up Palo Alto's achievements while adding another award to their resumes...

Raise money for the bike bridge from the huge employers East of 101. The $20,000,000 is chump change to them, much less than they contribute to the YIMBY parties our pro-development politicians love to address while shifting the tax burdens from them to residents!

Get creative and hold a contest asking US, the taxpayer-residents, for the examples of government waste that most bother US and estimate their costs and cost SAVINGS.


17 people like this
Posted by chris
a resident of University South
on May 1, 2020 at 9:06 pm

Since the depth and duration of the downturn is indeterminate, it is essential for the city to use its emergency authority to reduce the hours and salary of most of the staff. This does not obviate the need to eliminate certain superfluous programs, however.

The economy is likely to recovery on a gradual basis. Therefore the temporary hours and pay reduction is an important tool to keep experienced staff on board and be able to increase their hours as revenues and workload returns.

As mentioned, the entire reserve should not be completely depleted in this coming year, but this is the best example in most of our lifetimes of what the reserve should be used for, so that the city does not overreact financially to this crisis.

An example of false economy is closing a library as opposed to reducing hours. Closing a library would prevent a large segment of the population from walking to the library. Many of these people are seniors or younger people who could live with a reduction in hours as opposed to locking the building up. This is particularly true if libraries will become a site for merely picking up and dropping off books for some time as opposed to places where people will be allowed to sit down and read books and other material.

Also, the city should make it clear it is not going to be bullied into opening up activity too soon because of a few loudmouth residents who have failed to study how certain countries have been successful in dealing with COVID-19 (see Taiwan, Hong Kong, South Korea, China, Germany) as opposed to the US, Italy, and Spain.


9 people like this
Posted by Elizabeth
a resident of Downtown North
on May 2, 2020 at 1:26 am

Could we balance the budget by repealing Prop 13?


14 people like this
Posted by Online Name
a resident of Embarcadero Oaks/Leland
on May 2, 2020 at 10:11 am

Maybe Prop 13 could be repealed for just business properties since they "live" much longer than grandma and the tax burden has shifted from businesses to residents as many of the protests against massive office and hotel development have noted.


3 people like this
Posted by member
a resident of Charleston Gardens
on May 2, 2020 at 11:36 am

Residents, you all have great input, but unfortunately Alison and city council do NOT read these comments. I STRONGLY urge you to email your comments to:

[email protected]

...each council member will see your input. You need to be heard.

If you can attend the City Council meeting via Zoom on Monday May 4 and/or Monday May 11 (when the cuts are discussed), that is great too.


2 people like this
Posted by musical
a resident of Palo Verde
on May 2, 2020 at 11:47 am

Prop 13 tax ceiling is 1 percent. You want an unlimited ceiling like the TOT?


18 people like this
Posted by Rose
a resident of Mayfield
on May 2, 2020 at 2:33 pm

One opportunity to save a lot of money would be to postpone building the new public safety building on Sherman. The City can finish the new parking structure next door (it appears to be about halfway finished now), but postpone the new building. We could also eliminate for a brief period "fun" things like the Chili Cookoff and perhaps restore them when finances improve, or perhaps create something new? Let's remember -- this pandemic is something like a war. We can cut things that are less important, postpone projects like the bike bridge, and perhaps reduce salaries at the top. We must keep essentials, includng our precious libraries.


Like this comment
Posted by chris
a resident of University South
on May 2, 2020 at 3:11 pm

Last year, the CC resurrected the idea last year, but it dropped it in March of this year, early in the crisis.

So forget ant ideas of taxing business. CC has taken it off the table.


15 people like this
Posted by Resident
a resident of Another Palo Alto neighborhood
on May 2, 2020 at 3:28 pm

Going back to the Mitchell Park library fiasco, Alison was very vocal that we should be doing the best library possible for the sake of the children. She was very adamant that any type of upgrade to the quaint old library would be a disservice to future generations. I remember her writing an Op Ed for the Weekly stating all the reasons why a library was so very important as a legacy for all the children to come.

She seems to have changed her tune.


15 people like this
Posted by Missing cuts
a resident of Old Palo Alto
on May 2, 2020 at 11:23 pm

One cut I haven't seen suggested is reducing the VERY high salaries of some city employees. The Manager earns close to a half-million dollars/yr including all the perks and add-ons he receives. Has he suggested cutting his very generous salary?

I believe there are suggested cuts in enforcement of traffic,and codes. One cut is to allow AT&T to build their telephone equipment near homes, and not enforce the current rules. Big bonus for AT&T at our expense.

City Manager considers enforcing the codes and rules to be non-essentials.
Developers can rejoice.


20 people like this
Posted by $4 million home?
a resident of Downtown North
on May 3, 2020 at 6:41 am

Earlier this year, City Council approved giving a $4 million home to Ed Shikada, City Manager (i.e,. in the form of a $3 million city contribution and a $1m loan from the city).

He hasn't yet purchased a home...how about asking him to cut back to a $2 million condo or more modest home and save the rest for the critical resident services.

Also, City Council approved a $2.1 million upgrade to the City Council Audio-Visual equipment in their chambers. It seems Zoom is working fine. Maybe skip this expenditure?

Follow the big money. I doubt we are spending millions on crossing guards, zookeepers or children's bike rodeos.


7 people like this
Posted by Resident
a resident of Old Palo Alto
on May 3, 2020 at 6:58 am

I would give Ed two options - a trailer on the lot on Bryant (if it has not sold) where a former city manager used to live, or one of the BMR properties. He could get priority and jump to the top of the list.


10 people like this
Posted by Resident
a resident of College Terrace
on May 3, 2020 at 8:21 am

$114,000 for cement finishers (???)

Take home pay is much different then actual pay.

I know the poster was appalled by the salary difference between the librarian ($83,000) and the cement finisher. Obviously, the poster has never done a hard days work in their life. I am sure by the age of fifty the cement finisher would have rather taken the route of the librarian then his current job, even for less pay.

After paying out taxes, union benefits, the workers are probably left with about 2/3 of their salary. After commuting an hour each way, each day, $70,000 is not a whole lot of money.

I say axe upper management. That will save a lot. Keep the workers that actually do something.


17 people like this
Posted by Online Name
a resident of Embarcadero Oaks/Leland
on May 3, 2020 at 10:30 am

No, I wasn't appalled by the difference between the librarians' pay and that of cement finishers; I was unfamiliar with the job title "cement finishers" and hence the question marks.

I was appalled by Ms. Cormack's going after low-hanging fruit like the libraries when there are so many more egregious examples of waste the city could tackle first.


24 people like this
Posted by Online Name
a resident of Embarcadero Oaks/Leland
on May 3, 2020 at 10:36 am

Resident, I do agree with you that upper management pay is an obvious target for spending cuts. I think it's outrageous that the city manager -- the only candidate the CC bothered to interview in their rush to hire him -- not only gets a huge salary but they also awarded him an extra year's worth of salary AND benefits if he gets fired!!

You'd think they never heard of our unfunded pension liabilities.

I'm totally sympathetic with those at the lower end of the pay scales since they're often the hardest working and lack the power and budget to hire the never-ending stream of consultants to do their jobs.


Like this comment
Posted by Deborah Simon
a resident of Greenmeadow
on May 3, 2020 at 2:22 pm

Thanks for your thoughtful comments, as always. Very tough decisions ahead, even for us who count ourselves very fortunate.


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Posted by Elizabeth Beheler
a resident of Charleston Meadows
on May 3, 2020 at 3:41 pm

Thank you for your hard work during this time, I know many have been working long hours and making decisions based on constantly changing information. We will get through this, we'll make do for now, recover when we can, and help where we're needed.


7 people like this
Posted by Anon
a resident of Another Palo Alto neighborhood
on May 3, 2020 at 4:02 pm

Posted by $4 million home?, a resident of Downtown North

>> Follow the big money. I doubt we are spending millions on crossing guards, zookeepers or children's bike rodeos.

Exactly. Let's see how the budget breaks down by department. Let's see how many "managers" there are making over $250K compensation, what departments and functions, and compare that to market rates for those job descriptions. There is definitely something very, very wrong if libraries on the chopping block on day 1.


4 people like this
Posted by chris
a resident of University South
on May 3, 2020 at 5:09 pm

It is very important for the CC to distinguish between permanent and temporary cuts.

I’m sure that with the emergency the employees will be willing or can be forced to accept (if necessary) reductions in hours and salaries, which can be adjusted as the economy gradually recovers.

The economy will not snap back immediately. The CC needs to use a tool that can be calibrated, like the “dimmer” that has become some famous during this crisis.


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Posted by john
a resident of Adobe-Meadow
on May 3, 2020 at 7:28 pm

In 2010 the city pled poverty and fire/police employees took a pay and benefits cut to help. The city rewarded them the next contract by refusing to negotiate and delayed 18 months before finally agreeing to a petty raise. Dozens of experienced workers fled to cities that weren't the lowest in the county and didn't have the long commutes. I don't think they'll be willing to take another cut while Palo Alto throws away money on roundabouts, City Manager mansions, and Council Chamber seven-figure renovations.


Posted by Name hidden
a resident of Downtown North

on May 3, 2020 at 7:30 pm

Due to repeated violations of our Terms of Use, comments from this poster are automatically removed. Why?


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Posted by Reality check
a resident of South of Midtown
on May 4, 2020 at 12:07 am

What about the 40+million in budget stabilization?

I’d think real hard about cutting public safety, fire, or anything else until you actually see the numbers. Plus, don’t forget zero cash bail, and releasing all the petty criminals with citations the last two months and what effects that will have on crime rates in the Bay Area.


8 people like this
Posted by Jeremy
a resident of Midtown
on May 4, 2020 at 12:40 am

Since so many city services planned for March 2020 - ? are not happening, can't the City save money that had been earmarked for those services? Or is so much money going to dealing with the pandemic and paying employees who aren't working that nothing can be saved?

I find it curious that Councilmember's Cormack's list of City services that might be cut doesn't list any of the governmental staff at City Hall. For example, perhaps the City doesn't need a Chief Communications Officer--the City didn't have one until 2013. Also, does the City really need to hire consultants?

Perhaps there are construction projects that aren't necessary, or could be delayed until more people are back at work. Millions have been thrown into City Hall renovations over the last few years that have not all been necessary. Are any projects like that currently planned?

And surely the City's technology budget could be cut. How much equipment has been purchased or upgrades made just so that the City can live up to the image of being the birthplace of "Silicon Valley?" Many City Hall renovations have been in the same vein.

I know these items (except for major construction projects) are only a small part of the City budget, but surely City Hall can cut some of its own budget, and not just slash services that the community relies on.


6 people like this
Posted by Resident
a resident of Another Palo Alto neighborhood
on May 4, 2020 at 7:53 am

There is a good case for saying that the City of Palo Alto has too many chiefs and not enough indians. We have too many top jobs, too many image or statement attractions, but not enough basics. We don't have electronic signage for parking,or visual pointers for where parking is available, or parking apps, or basic useful infrastructure. So please do not put those expenses to the bottom of the pile instead of whittling down the number of administrators that are doing nothing but moving paper and signing their name that they moved it.


11 people like this
Posted by Prioritize
a resident of Palo Verde
on May 4, 2020 at 10:50 am

Cut CAPITAL IMPROVEMENTS and other expenditures before cutting libraries and community services.

To the author of the piece, I can think of loads of things you should cut before telling Palo Altans 'we just have to bear it. It's gonna be hard.'

We should:
* Put a hold on the bike boulevard project and fire the consulting firm.
* Put a hold on the cubberley redesign project and fire the consultants.
* Don't start Byxbee park upgrade construction
* Keep fire station 4 as is, fire the consulting firm
* Hold off on the Public Safety building project, keep it at city council.
* Don't upgrade the city's alarm system
* Put a hold on parking structure upgrade project, fire the consultants
* Don't upgrade city's fleet of vehicles. Use the existing ones
* Fire grade separation consultants, put hold on project
* Pause airport upgrades (new parking lot, security, buildings)

Not trying to be edgy here, I'm genuinely asking that you consider these.


2 people like this
Posted by Online Name
a resident of Embarcadero Oaks/Leland
on May 4, 2020 at 11:17 am

Seconding Prioritize's post above with a reminder that construction costs will be even higher than usual due to the pent-up demand. Note the history of cost over-runs and delays even in normal times.

Also, insist the city come back with a budget estimate of the savings for each of the above projects.

Re the parking structures, how many years have we been asking for parking space availability signs for existing garages like most other cities have? We can't even do that expeditiously.


9 people like this
Posted by Joseph E. Davis
a resident of Woodside
on May 4, 2020 at 12:04 pm

Scrap defined benefit pensions for public employees first. Then we can talk about libraries.


9 people like this
Posted by Joe
a resident of Another Palo Alto neighborhood
on May 4, 2020 at 12:19 pm

From the front page of today's POST:

Palo Alto’s payroll grew by 2% last year, to $126 million, and for the
first time an employee took home more than $400,000 in pay, according
to new data released by the city.

City Manager Ed Shikada broke the $400,000 barrier, making $403,729
in 2019. The employee with the second highest pay was police Sgt.
Adrienne Moore, who made $342,009, followed by police Agent Christopher
Moore, with $334,742. Their pay exceeded that of Police Chief
Robert Jonsen, who made $320,664 last year.

Talk about "breaking your heart" .. Guess Council Member Carmack wasn't paying attention to the labor costs of Palo Alto. And keep in mind that next year, all of these people will be making more than this year--while not producing anything more to justify their salaries. And -- their pensions are linked to their salaries.


2 people like this
Posted by chris
a resident of University South
on May 4, 2020 at 2:47 pm

Joe,

Are you going to be on YouTube tonight to tell the Council your comments in person?

I don't think there is a guarantee that employees will make more next year than this year. I would assume smart city negotiators could get the employees to take less in order to reduce the number of layoffs.


8 people like this
Posted by Family Friendly
a resident of Old Palo Alto
on May 4, 2020 at 2:55 pm

It always breaks my heart... just not for the reason the author believes.


6 people like this
Posted by Joe
a resident of Another Palo Alto neighborhood
on May 4, 2020 at 3:38 pm

> I don't think there is a guarantee that employees will
> make more next year than this year.

Hmm .. every year, in the Fall, the City releases a report (Long Range Financial Forecast) which includes a 10-year projection for the City's labor and benefits costs. For the past several years, these forecasts have projected a constant 3% increase in all labor costs. None of these projections have ever shown a labor cost decrease.

Now, these projections are not cast in stone. But given that the City Council rarely ever seems to see constant labor increases as a problem--then it's a good bet that increase labor/benefit costs will continue into the future.

As to the individuals who are identified in the POST article, if they retire, or work less overtime (for the Public Safety employees), they might not make quite as much next year. But even if these individuals don't make more next year, it's another sure bet that other employees will take their place with these very high salaries.

The City has been releasing employee salary data for several years now. Given the Financial Forecasts, and the actual salary data--the constant increase in labor costs and salaries is well documented.


15 people like this
Posted by Asher Waldfogel
a resident of Old Palo Alto
on May 4, 2020 at 5:56 pm

We know we have to cut the General Fund next year. We also need to think about the Electric, Gas, Water and Fiber Enterprise Funds which total up to nearly the same size as the General Fund.

How to cut? We start with principles like justice and fairness. We don’t cut where it’ll hurt the most vulnerable, and we expect all parties: staff, residents, businesses to share the burden of reductions. We don’t want to abandon what makes Palo Alto a special place to live. Before we start cutting we have to ask what’s deferrable and expendable: we should defer future capital projects, rebid active projects (assuming our contracts have emergency clauses), and assume most contract employees can be cut. Any position that’s justified by fees needs to go until the fees return.

The big ticket items in the General Fund are Police, Fire, Public Works and Planning, so it makes sense to start there. Shame on us if our labor contracts don’t give us any wage or work condition flexibility in an emergency except layoffs. It’s just lazy to start cutting with Children’s and community programs that make up 10% of the city budget.

What a chance to think big. Does it really make sense for Palo Alto to have back office functions like purchasing, IT, and HR? Why not consolidate those functions with five other cities or even countywide? With a long-term plan to get out of the gas business, why not merge utility operations with Silicon Valley Power? Or expand into community power purchase services for cities like Mountain View and East Palo Alto? If we’re never going to build fiber to the home (and I wish we would just do it), why not sell the fiber utility to a commercial operator? If we can’t afford to run all the libraries we recently built, can we transfer the big ones to the county and staff the smaller ones with volunteers as community spaces?

We also need to watch how utility rates are adjusted to compensate for potentially lower commercial demand, and make sure residents don’t pay more to fill the gap.


4 people like this
Posted by Anon
a resident of Another Palo Alto neighborhood
on May 4, 2020 at 9:12 pm

Asher Waldfogel has a lot of interesting ideas and options, and, I definitely think we should consider all the possibilities. I would add, though, that I'm very skeptical of "consolidation". In my experience, it is always cost-ineffective. In any case, we have an immediate crisis. The fire and police departments appear to be very top-heavy. There should be a way to reduce the large number of people making over $250K/year. Beyond that, from the current budget plan, cut the capital improvements budget. right now it is something like $93M. No new starts- just finish construction already started and stop there. Postpone the new public safety building. Finish the parking garage since it is in progress, but, no new starts this year or next. What is the $11M "Council Appointed Officials and City Council" -- can we just cut that? I think these items alone will stop the bleeding for the next 12 months.


5 people like this
Posted by DickD
a resident of Crescent Park
on May 4, 2020 at 10:59 pm

I have worked at a couple of firms with budget squeezes comparable to what our city faces. At these places payroll with all the side "benefits" such as vacations sick leave, social "security" was the core problem. The heartless move but effective in several ways was management was required to rank every one in their "domain" on a scale of 1-10 with the requirement that there be identified as many 1's as 10', etc. . . . then the least performers (1's) were terminated, including the management crew.

This gets past the this job vs. that job's importance but gets at a generally agreed fact of life - not everyone in their present job and compensation is a "top performer" in that job at that pay level, including managers . . . so it's a way to fix the realities of the budget problems and improve the effectiveness of the organization as a whole.


7 people like this
Posted by Another Giveaway
a resident of Another Palo Alto neighborhood
on May 4, 2020 at 11:13 pm

Learn the concept of a sunk cost.

Stop construction of the Cal Ave parking structure. The Cal Ave parking structure will not be needed in a post COVID world. Stop all capital improvement projects that are really just thinly disguised real-estate developer subsidies.


6 people like this
Posted by Resident
a resident of Old Palo Alto
on May 5, 2020 at 6:03 am

Palo Alto's troubles are really just beginning.
Unbelievably...The high speed rail team is still going ahead with their plans to have that darn train to travel between SF and Bakersfield by 2031. I'm not sure where they plan to get $13 Billion dollars for it. Perhaps one of the editors has some free time to write more on this nutty project.
Remember how they tricked us into voting for it? (Not me though)

Web Link


5 people like this
Posted by Anon
a resident of Another Palo Alto neighborhood
on May 5, 2020 at 9:37 am

Posted by DickD, a resident of Crescent Park

>> I have worked at a couple of firms with budget squeezes comparable to what our city faces. [...] management was required to rank every one in their "domain" on a scale of 1-10 with the requirement that there be identified as many 1's as 10', etc. . . . then the least performers (1's) were terminated, including the management crew.

If you look at the pages of top compensation, you will see that it is largely public safety: Web Link The problem isn't that they are underperforming; the problem is that they are paid so much. OBTW, I generally support both public employees and unions, but, we just have an unsustainable level of compensation. e.g. The top 50 people make over $313K in 2018. Between public employee rules and union contracts, there is no way this is going to be like it is at a private firm in a downturn.

Posted by Another Giveaway, a resident of Another Palo Alto neighborhood

>> Learn the concept of a sunk cost.

I have. ;-)

>> Stop construction of the Cal Ave parking structure.

Yes, that applies to several things, but, not that parking structure, which can't be left like it is, and which is occupying the space. It may have been unnecessary, but, it is now necessary to finish it. However, the new public safety building that it indirectly supports "must" be put on hold for the next two years. Hopefully, the design work was done with enough finesse that it can be dusted off in a few years and won't be mostly wasted effort. Likewise, the next firehouse upgrade/replacement, and, any other projects still on the drawing board.


3 people like this
Posted by Anon
a resident of Another Palo Alto neighborhood
on May 5, 2020 at 10:06 am

Sorry to follow-up so soon, but, re-reading the initial article:

>> We rely on this source of revenue to help fund our infrastructure projects, like the new fire station on Embarcadero Road and the bike bridge over Highway 101 and the upcoming police station near California Avenue.

>> Most hotels are empty at the moment and some have about 10% occupancy instead of the usual 80, so this source of revenue has screeched to a halt

QED. Halt! Don't start construction on the new Mitchell Park Fire Station. Halt the bike bridge. Don't the public safety building near Cal Ave. Finish the parking garage because of the stage of construction it is in, but, don't begin the public safety building. If the source of revenue has screeched to a halt, so must new starts using that revenue.


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Posted by Another Giveaway
a resident of Another Palo Alto neighborhood
on May 5, 2020 at 12:04 pm

@Anon,

You can't say you understand the concept of a sunk cost and then say the city has to build something that was/is unnecessary.


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Posted by Anon
a resident of Another Palo Alto neighborhood
on May 5, 2020 at 2:29 pm

Posted by Another Giveaway, a resident of Another Palo Alto neighborhood

>> @Anon, You can't say you understand the concept of a sunk cost and then say the city has to build something that was/is unnecessary.

You know the state of the site now, right? How much do you think it would cost to remove what is there, put things back the way they were, and terminate the contracts? We can't do anything about the sunk costs, but, we have to decide what the most cost-effective way to proceed is.

BTW, I do think the public safety building will get done eventually because the city needs a survivable public safety building. Likewise with all firehouses.


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Posted by Jon Zeitlin
a resident of Evergreen Park
on May 21, 2020 at 2:52 pm

Good opinion piece by Alison Cormack. Makes it clear why the budget is in trouble.

Wondering about the feasibility of a one time city tax to make up revenues while the restaurants and hotels recover. Seems like the tech economy is rolling pretty well still and that Palo Altans would be willing to pay some additional taxes to keep these vital services going (we love Palo Alto Children's Theater).


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Posted by Michelle Arden
a resident of Professorville
on May 21, 2020 at 3:26 pm

Please please email [email protected] to save the Children's Theatre budget. Alison Cormack wrote back to me when I emailed her (which I thank her for), and it is clear that she's not committed to do so.


2 people like this
Posted by Michelle Arden
a resident of Professorville
on May 21, 2020 at 3:28 pm

And as for tradeoffs: We do not need five libraries, or the bike bridge. (And don't get me wrong, I love the Downtown library). We could live easily with two libraries - Rinconada and Mitchell Park. And, the bike bridge is just unnecessary now. Any infrastructure spend should be scrutinized carefully.


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Posted by devich
a resident of another community
on May 24, 2020 at 10:25 am

$6 million a year for department of urban forestry


5 people like this
Posted by Online Name
a resident of Embarcadero Oaks/Leland
on May 24, 2020 at 3:11 pm

@Jon Zeitlin, Allison Cormack is leading the fight AGAINST cutting any of the big capital expenditure projects she's championing -- Cubberly, the totally rebuilt and redesigned fire station, etc. I therefore think you'd see a mass rebellion against any sort of new tax in view of that refusal.

The piddling cuts the counci's proposed -- $165K for libraries, etc. -- pale in comparison to the tens of millions of dollars EACH of the big cap ex projects cost. $20,000,000 for the bike bridge is just one that comes to mind.


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