|The Lookout Letter to the editor|
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April 20, 2020
Like many other cities across the country, Santa Monica is faced with an impending financial crisis as the result of steps taken at all levels of government to combat the coronavirus.
The economic shutdown recommended by the Federal government, imposed and extended by the California government and taken steps further by the City will starve every level of government revenue flows.
As reported on this news site, recently resigned City Manager Rick Cole estimated that the City faces a budget shortfall of $226 million by July 2021 ("City Faces $226 Million Budget Gap Due to coronavirus Shutdown," April 13, 2020).
We can hope that his estimate overstates the shortfall by magnitudes similar to the early estimates of coronavirus deaths. But just as with our response to the health emergency, the City must prepare for the worst and take necessary steps to slash the budget accordingly.
The necessary revenues are not going to come from whole cloth or from thousands of residents without jobs as a result of shutdown policies that have destroyed -- and continue to destroy -- thousands of small employers.
What is necessary to start the process rolling is the appointment of an Emergency Director from outside the current City staff who will began to address a meaningful return to normal within the federal recommendations and forthcoming State guidance -- not to impose additional rules and requirements on City residents and businesses.
This will entail recommending difficult decisions and perhaps "bucking" some or all council members when doing so. It will certainly require the skills of someone capable of crisis management in the fiscal arena.
In fact, the Director should be able to rely upon a Council-appointed financial task force that does not include members of "in groups" such as Santa Monicans for Renters' Rights (SMRR) and has the blessing of the new Diirector.
Politically favored spending is not the answer, and over 40 years of SMRR’s big-foot presence in the City informs us that is precisely what would ensue.
Here’s how dealing with the fiscal problem should not start -- with a look at how to cut the numerous spending programs across the City budget.
Instead, the City needs to employ "zero based budgeting" that starts with essential services -- including the endless ‘vanity’ projects that have been embedded in the budget over 40 years -- and determine what is needed at a minimum.
If after this exercise, there are anticipated revenues, allocate those to generate optimal essential services.
Essential services start with -- and basically end with -- police and fire protection and related infrastructure (homeless management costs fall into these categories) and essential public health services for which the City may be responsible.
Then, if there are anticipated available revenues, bring back other expenditure categories based on need, not desire. The advisory task force and an emergency director or crisis manager must play a significant role in these decisions.
Attempting to preserve an panoply of budget items with various budget cuts will simply create a boondoggle of political haranguing among politicians and the insidious special interests that populate our city. It will not generate a budget that serves Santa Monica.
Our elected leaders must address the situation realistically or they should be replaced -- by election or recall.
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