Politics | District 6

A Model for Police Compensation in 2013

Note: This is Pierluigi Oliverio’s 300th Post:

Negotiations between the city of San Jose and the Police Officers Association continue to be contentious. (Photo by Thomas Hawk).

Our goals for law enforcement in San Jose must be based on need and the amount of tax revenues on hand. As Gov. Jerry Brown stated last month, “People want to have more childcare, they want to have more people locked up, they want to have more rehab, more, more, more. More judges, more courtrooms. We have to live within reasonable limits.”

San Jose has no choice but to operate in the world of reasonable limits, and it can only allocate money that is actually on hand. The city should not make new promises that cannot be kept.

Much has been said recently about law enforcement budgeting. A year ago, I wrote two articles suggesting a specific percentage of the budget should be allocated to police, thus allowing the police department to grow in keeping with future tax revenues and a growing population. Those previous posts can be found here and here.

Since this is not the case today, I must work within the current system.

One of the shared community goals is to increase the actual number of police officers. In addition, another shared community goal is for pension reform. In my opinion, these two objectives are inextricably linked. Back in 2010, I initiated, and a majority of the City Council supported, ballot Measure W. Voters in November 2010 approved Measure W by more than 72 percent. This gave us—for the first time ever in San Jose—the ability to create a new, lower cost pension plan for future employees.

Since the passage of Measure W, a second-tier pension system has been implemented for all new city employees, except for fire and police. Neither the fire nor the police unions agreed to accept a new retirement plan for future employees—again, we are talking about people who do not even work here yet. The restructured, lower-cost retirement plan for new hires is fundamental to financial stability, and it allows us to add new police officers over time as savings are achieved through pension reform.

Countless other government entities across our state and country have implemented a tiered pension system that includes public safety unions. In my view, a second tier must be in place for fire and police prior to any compensation discussions. Again, our Governor clearly agrees with this line of reasoning: “Pension reform can be hard to talk about,” he said. “In the long run, reform now means fewer demands for layoffs and less draconian measures in the future.”

When it comes to the present discussion on compensation, one option is to give all employees an ongoing raise. While an ongoing compensation increase may be ideal, there is no money to backfill it next fiscal year, which would then result in 100 percent pay cuts for some city employees—in other words, layoffs. Every 1-percent compensation increase to all city employees would cost $7.9 million per year. However, this assumes that all positions are equal in value, and are equal in terms of interest for recruitment purposes. I can guarantee that in any outcome achieved, no one will be happy since tax dollars are finite. Those who want, may not get; and those who get, may want more. Knowing this, I suggest an option for cash in hand now for those who enforce the Social Contract.

This proposal would function in the following manner: Each police officer would be given the option to select a scheduled redemption of their accrued benefit of up to $15,000 over 15 months, starting in the upcoming fiscal year. The $15,000 could be derived—by employee choice—from any of three accrued sources: comp time, sick leave or vacation time. These three accrued sources currently add up to over $50 million just for police officers alone, the majority of which is sick leave at approximately $36 million. This $50 million is recorded as an accounting liability and must be paid out when someone retires or resigns.

Paying a portion of this out now would reduce future payouts that would be even more costly in the future, as accrued benefits are typically earned at a lower pay scale but always paid out at the highest pay scale. This action would also enable a future council to have more money to fund city services. The $15,000 payout option would cost approximately $15.2 million if every police officer was to redeem the maximum, and would consume over half of the $22.5 million in one-time funds that are available.

There is also potential to add new police officers. On Tuesday, the council will take action on a $6.9 million reimbursement from the county on property tax recalculation. This one time windfall of money should go directly to hiring new police officers if, and only if, a new retirement plan is in place for the police union. This money could be used to “hire ahead,” which would front the cost of new officers being vetted to coincide with future vacancies as current officers retire or leave. Incidentally, $6.9 million is approximately the same amount of money the city pays to subsidize golf and the Hayes Mansion each year.

The fact is that each individual has their own economic situation, which may or may not include a variety of personal factors. Whatever the situation may be, it is impossible to examine each police officer’s household income and ensure that they are paid according to their needs. This option ultimately allows the individual to choose what is best. One individual may choose to redeem the maximum amount, while another may redeem half, while yet another may choose to not redeem at all, instead saving it up for a future potential payout. This option is based on individualism rather than collectivism.

With this spirit in mind, we acknowledge that individuals will pursue their own happiness, and, as a result, may seek employment elsewhere or a different vocation.

Also posted in Measure W, POA, Police | Comments closed

Park in the Sky or Pie in the Sky?

Planning departments across the USA commonly create “specific plans” and/or “master plans” for certain streets and neighborhoods within a city. San Jose, not unlike other cities, has many of these same plans.

These plans tend to have colorful illustrations depicting what life in the future would be like, and almost always seem to be utopian in nature: happy residents walking with their animal companions in tow, people on bikes, massive parks that melt into the horizon, cafes filled with laughing people laughing, and my favorite … children with balloons.

Most of the time these plans are put together with the best of intentions, but they end up sitting on a shelf due to their inherent lack of practicality or feasibility. For example, many of these plans depict large parks that have no funding source—this is deceptive. If a plan calls for a large park, then many market rate housing units are required to fund that park. (Only market-rate housing, not affordable housing, pays 100 percent of park fees.) In one instance in my district, Cahill Park could have been larger. However, the City Council prior to my tenure approved a housing development that was less dense, and therefore a smaller park resulted.

Sometimes staff solicits ideas from the community, and in doing so propagates a false hope that can only exist in an alternative universe separate from our fiscal reality. For example, one idea involved building a park “in the sky” over the 280 freeway, which would have ended up costing approximately $100 million. This idea should have been eliminated instantly, due to the prohibitive cost. Instead, it was kept alive by the somewhat absurd notion that San Jose voters may someday tax themselves to support a nine-figure project.

In the past, staff and ultimately the council have limited the development potential in a specific plan area when it has been deemed that residents would prefer to maintain the status quo. Case in point, based on community feedback, the 1998 Alviso Master Plan limited the construction of any new industrial office buildings to one or at most two stories on North First Street. The unfortunate consequence of the height limitation is that we have had to forgo market driven demand for taller, 5-8 story buildings. In effect, this specific restriction in the premier technology corridor of San Jose has limited the city’s economic development as a whole.

An alternative approach that would be more conducive to economic growth would involve first identifying a limited number of job creation sites in San Jose located within specific plan areas. We should then re-examine any existing limitations within these job creation sites and remove any restrictions that may block private investment, as in the Alviso example cited above.

Another reason these plans are often doomed to failure can be attributed to the fact that a private property owner may simply not want to develop their land. In other instances, residents will express a desire for a new park on land that is privately owned, and oftentimes this same parcel has an existing structure with tenants already in place. At the end of the day, America is a country that places high value, rightfully so, on private property rights. Thus, successful development is most likely to occur when the private property owners themselves initiate plans, not when an outsider who does not actually own the property injects impractical conceptual drawings into the process.

Currently, staff is planning the development of “Urban Villages,” with the goal of mixing residential and employment activities. Furthermore, the development of such villages would establish minimum densities designed to support transit use, bicycling, walking, high-quality urban design, revitalization of underutilized properties, and the engagement of local neighborhoods and private property owners in the process. Here is a map of the future Urban Villages.

Having attended three Urban Village planning meetings in October, it is my hope that the plans ultimately approved by council are realistic and allow for expedited development. However, I believe a disclaimer acknowledging private property rights should be on the first page of any proposed plan, and that ultimately development will be initiated on a timetable that government cannot control—especially if the plans are too far from market realities.

Sometimes, a proposed development is in harmony with a pre-existing plan, but just as often this is not the case. In either instance, my objective as a councilmember has always been to consider different points of view and support or oppose development based on the long-term economic benefits to San Jose as a whole.

Also posted in Housing, Parks, RDA | Comments closed

Youth Employment and Life Lessons

I remember making minimum wage, $3.35 per hour, when I worked at Burger King during high school. Most of my coworkers were high school students, college students and very few were adults. Prior to my job at Burger King, I had a paper route that, according to my memory, netted out to less than minimum wage. In the case of the paper route, I had to pay for the newspapers, rubber bands, and bike expenses, not to mention my time to fold and deliver the newspapers. In addition, back then we had to go door to door to collect the monthly subscription.

Over time, I received raises at Burger King by passing tests on food preparation and positive performance evaluations. Merit-based raises of 10 cents were earned, and I achieved my top rate of $4.15 and a promotion to Production Leader. I recall enjoying the job except for the increased acne from working the fryer station and those ever-attractive brown polyester uniforms. Around this time, I actually contemplated quitting high school and pursuing a management position at Burger King. Instead, I stayed in school and went on to college like many of my fellow high school co-workers.

It seems like today that the opportunities for employment and taking on responsibility have decreased for our youth. The paperboy on a bike has turned into paperman in car. And Burger King-type jobs have changed from youth to adults, many of whom are recent immigrants.

I am voting “no” on Measure D, which would increase the minimum wage only in San Jose from $8 to $10 an hour. As a councilmember that represents a district that borders two other cities, I see firsthand how San Jose competes for retail sales, filling vacant commercial space and jobs. Westfield Valley Fair shopping center, for example, is split between Santa Clara and San Jose. If a new prospective tenant has a choice of space in the mall, they will choose Santa Clara should measure D pass, as I will explain.

Residents do not stop in their tracks when they reach the invisible border of a city limit. They shop based on convenience, quality and the big one—price. Measure D will put San Jose at a disadvantage just like the currently proposedHabitat Conservation Plan that Mayor Reed lampooned for over an hour at last week’s council meeting.

Measure D will create wage inflation. Workers that make $10 today will seek $12 tomorrow and so on. If a business only has so much money allocated for payroll, then the result will be laying off a certain number of employees or reducing hours to keep payroll in line with actual sales. I believe youth will comprise the majority of the layoffs and reduced hours. Measure D, which is a 38 percent increase in payroll (wages & payroll taxes) to employers who pay minimum wage, would not increase sales 38 percent nor even 1 percent.

A business in San Jose that employs minimum wage workers will simply have less profit margin and some of them will inevitably move. In the case of my district, these businesses will move just over the city border and those that remain in San Jose will increase prices. My dad, who grew up during the Great Depression, will drive to another city just to get a free plastic bag. When prices increase, my dad, who could easily win the game show, “The Price is Right,” will simply shop in another city.

Those that make $10 today instead of $8 are either performing well or have a more difficult job, which is why they make 25 percent more. Is it fair that the current $10 a hour worker would now be equal to a $8 hour worker? Does it create the expectation for future two-dollar wage increases through no effort of the individual? That is a debate in itself, however, the real problem is that San Jose is not a silo and we are surrounded by other cities.

Measure D would create retail vacancy in San Jose, especially near the border of other cities. Over time, new business will choose cities where payroll costs are lower and, most importantly, where their payroll is not regulated and audited by city government. For San Jose to comply with Measure D requires the hiring of people to oversee and regulate business for compliance with no revenue to pay for those new positions. I would much rather higher five new people in our planning department to expedite the process for industrial and commercial development than positions that add zero value, which Measure D would mandate.

The few cities that have raised the minimum wage are anomalies bordered by water or desert: San Francisco, Washington D.C. and Albuquerque.

To my original premise, I believe Measure D will result in less jobs for youth in San Jose. Employment for youth outside of compensation provides the opportunity to learn valuable life lessons.

On a related note, the majority of my council colleagues voted—but not me—to discuss and take a position on various State Propositions like the Death Penalty at this week’s council meeting. In my opinion this is a waste of timethat has nothing to do with the City Charter and we might as well discuss, how many angels can dance on the head of a pin.

Also posted in City Council | Comments closed

Tuesday is for Meetings

Woody Allen had a theory on success. He said most of the hard work was just by showing up. (Photo by rasdourian, via Flickr)

Tuesday is the day that councilmembers reserve for City Council meetings.Closed session council meetings start at 9-9:30am and often continue past noon. The public council session starts at 1:30pm, often merging into the evening session with a short break. If no evening session is scheduled, then the afternoon session simply continues into the evening until the entire agenda is covered.

Woody Allen once said that, “Eighty percent of success is showing up,” and many would agree with that statement. Fortunately, I have not had any family emergencies and thus I have been able to attend every council meeting and council committee meeting since 2007. Many council meetings, especially the years 2007-2010, went from morning till near midnight. It is our duty to attend the council meetings, specifically for the agenda items that require voting, and stay for as long at the meeting takes; just like an employee is expected to attend a meeting hosted by their employer.

Councilmembers have an obligation to attend council meetings and council committee meetings; however, there is no requirement that you must actually stay the entire meeting. But attendance is taken multiple times at council meetings.

First, you are marked absent if you are a few minutes late at the very start of the morning closed session meeting. Attendance is taken again during the closed session meeting, when each attendee signs a document. Finally, attendance is again taken at the afternoon and evening meetings.

Councilmembers are able to leave as needed if they are not feeling well or have some personal matter to attend to. Councilmembers need only be present for half the meeting to avoid being marked as absent. If not present for the vote of an agenda item(s), then they are marked as absent for the vote(s). If councilmembers are in the restroom during a vote, they are still marked as absent—so best to monitor one’s intake of water.

Every level of government has official legislative/committee meetings and attendance is the minimum requirement. However just because one elected official wants to leave the meeting does not mean everything should come to a stop. If you need to go, then go, but leave it at that.

Many wish that the actual council meetings were shorter than they are today. The bulk of the council meeting is actually the unlimited discussion by council and mayor. On the other hand, public discussion is limited to two minutes and sometimes only one minute per each speaker. While members of the public speak, each Councilmember has that ability to view a timer that tracks the speaker’s time till you hear the famous words, “Your time is up.”

In the U.S. House of Representatives, members are limited in their speaking time. For example, members are given five minutes for committee meetings. So, rather than limiting the amount of time that the council or mayor may speak, perhaps the same timer used for the public should be allowed to run, tracking how long a councilmember, mayor or staff has spoken or is still speaking. This would allow for more concise and direct dialogue rather than circuitous speeches.

For example, tomorrow the council will burn a couple of hours discussing county and state ballot initiatives.

If you are the type of person who dislikes meetings, then I would discourage you from seeking elected office.

Also posted in City Council, Closed Session, Culture | Comments closed

Habitat Conservation Plan

For over 10 years, San Jose has been struggling with implementing a Habitat Conservation Plan (HCP). HCP is a regulation imposed by the Federal government to restore natural habitats and preserve wildlife, like the spot checkered butterfly and the burrowing owl. HCP is an unfunded mandate from the Federal government levied on local government. Federal agencies are not big on waivers or tweaks, as they have one goal and that is the regulation and job security.

The main premise is that any and all new development—even if rebuilding an existing structure—would pay a substantial fee under an adopted HCP. This fee would create yet another hurdle for economic development in the name of saving wildlife. To some, this may just be fine since wildlife may have a higher value than economic development, like jobs. To others, they may not care since much of the wildlife in San Jose actually resides in much of California. Relocating burrowing owls, for example, within the existing city infrastructure to outside the city is frowned upon.

For others, who would rather see near zero development in San Jose, they will very much enjoy the potential outcome of a HCP. The implementation of a HCP would potentially cease development and have San Jose become more expensive than surrounding cities like Santa Clara, Sunnyvale and Milpitas. Now that we have an adopted General Plan that emphasizes development of land for jobs, this is a great time to encourage economic development. However, with this new fee, San Jose could lose out on new job growth, and, as a consequence, tax revenue. The cities to our north in Santa Clara County are exempt from the HCP, because they are built out and San Jose, on the other hand, is punished for implementing a green belt. The HCP would include Morgan Hill and Gilroy.

Other areas like San Diego have enabled residents to decide this question by taxing themselves via sales tax or parcel tax. The premise of the HCP is that there is a high value to preserving the natural habitats of certain animals and restoring habitats. If it is such a high value, then residents may choose that value when they vote to tax themselves for that value. If it is not highly valued by the electorate, then we will have to go down the road of taxing all future development to pay for the sins of the past. Implementing the plan at one point would have cost $1.2 billion, and it has been scaled down to $660 million. I would propose this question be placed on the 2014 ballot.

If nothing was done, Federal agencies would not approve permits for new construction. New construction creates water and that water must go somewhere like a storm drain—and that requires federal approval. It could also block public infrastructure improvements, such as a bridge or rebuilding of theWater Pollution Control Plant. Coyote Valley and the Almaden reserve are areas that provide ample land for habitat. Building within the city infrastructure is the prudent thing to do, but not if the tax is so high or a burrowing owl is on a parcel within the city existing city infrastructure, like North San Jose. For example, if HCP was in place today San Jose would have had to pay $170,000 fee for the Convention Center expansion. (Convention Center expansion is being paid for by the hotels, which have increased the hotel tax paid by overnight guests.)

The cost, $170,000, may not sound like much since we talk about billions all the time with Federal and State dollars, but at the local level that level of fee could dissuade new development, like the large office building the City Council unanimously approved for Santana Row last month. Another way to look at it is the city of San Jose has removed fees to promote building in downtown and North San Jose, and this new HCP fee would negate this effort.

I’m not sure how things became so disconnected between economic development and providing federal funding to comply with federal regulation. Be sure to ask your elected Federal representative. This topic will be discussed at this week’s council meeting.

Also posted in Business, City Council, Culture, Santana Row | Comments closed

Unshackle the Police Reserves

San Jose Municipal Code Section 8.12 authorizes the use of the PoliceReserves. Although the Reserves are available, the city is not utilizing their full potential. Use of the Reserve officers could offer valuable assistance to the city because they are fully sworn and have the authority of a regular officer under California Penal Code Section 832.6(a). Reserves have already completed the police academy and carry a gun.

If the city requested, the Reserves could potentially put an extra 20 officers on the street tomorrow. There are currently over 80 Reserves on the roster. If just 25 percent responded, the city would have 20 additional sworn officers available to patrol our neighborhoods. I realize that this may require negotiation with the labor union, and there is the possibility that the Police Officers Association may not be supportive. However, I am hopeful that the city and the POA could work collaboratively and bring forward a plan that would utilize the reserves; even if the plan were in the form of a pilot program and/or for a certain amount of time. For example, if the police union and the city could agree to use reserves for one year for specific purposes, etc. At the very least, we should try.

Another goal to strive towards is allowing the hiring of retired SJPD officers to work and be paid on an hourly basis—but not accruing further pension benefits. These retired SJPD officers could do background checks, burglary investigations, evidence gathering, get warrants, etc. for a one-year period.

Currently, the Chief of Police mandates that Reserves can only work alongside a regular officer, in the same car. Quite often the Reserve is not even counted as being in the car; thus, while there are physically two officers in the car, they are signed on as a one-man car and can only be dispatched as a one-man unit. If that practice were changed, we would see an immediate 800 hours per month of extra police patrol. Every Reserve must currently do a 10-hour shift on patrol each month (80 x 10 = 800). The Los Angeles Police Departmentallows Reserves to work by themselves or with other Reserves:
If the Reserves that are qualified to work as solo officers—about 80 of them are—were allowed to work on their own, they would add additional patrol cars on the streets; making a more visible police presence. I have heard that some current officers may resent the utilization of reserves and would rather not drive in the same car. If that is true, then the city and POA should allow Reserves to drive by themselves as most current officers do or allow Reserves to team up in the same car. If we allowed this, we might see many more Reserves volunteering more hours.
Reserves could also be utilized in other ways, too. For example, they could provide prisoner transport, be the second officer on a crime scene, assist in back-up when officers are sick, in court, etc. Having Reserves be part of the SJPD team would also lower overtime costs and provide time for police officers to take a vacation.

The Chief and the command staff know of the authority of the Reserves to backfill units because they already use the Reserves for the “Keith Kelly” Relief night (twice a year), as well as relief for the Police Olympics (one week a year). Therefore, there is a current and active precedent for using the Reserves for SJPD backup.
Although the Reserves work for free, they are allotted $1 per hour of work for their uniform allowance. Therefore, the city would incur an $800.00 per month fee for uniforms for the Reserve for a second voluntary shift per month.

San Jose needs to do the best we can today and we need to utilize all of our available resources now by allowing the Reserves to be visible patrolling San Jose neighborhoods. Utilizing Reserves and Retired SJPD is a cost effective way to provide law enforcement during this time with limited tax revenue.

Also posted in Culture, POA, Police, Reform | Comments closed

Influence of Society on Career Choices

When I was a kid, I would watch the old 1950’s show, The Honeymooners. I remember one scene where the main characters, Ralph and Ed, were talking about future vocations for their children. Ralph spoke about his child going to college, while Ed said—if he had a boy—that he would get him a job working with him side by side in the sewer. At that point, the audience laughs and Ralph’s eyes bulge out. He yells that Ed is nuts for suggesting a career in the sewer.

Although parents and their children may not always agree, more often than not parents only want the best for their children. For example, it is not unusual for a parent to want their child to be a doctor or a lawyer because these occupations often offer prestige, autonomy and good pay. These occupations require an academic education rather than trade school. The 1967 film “The Graduate” comes to mind when Mr. McGuire says to Ben, “Just one word. Are you listening? Plastics. There is a great future in plastics.”

For many high school graduates, college may not be pursued. Like Ed in the Honeymooners, many in society are employed in vocations that use a trade and/or manual labor that is also mentally challenging.

Last week, the City Council approved spending money from sewer fees—not the general fund—to hire a private company for the next year to assist at the Water Pollution Control plant. These private contractors will be used to augment city staff and do tasks that current city employees will choose in the near future not to do. The contractor will also provide relief for city employees to take vacations.

In 2007, when I started on the council, I heard over and over again that the plant employees were predominantly baby boomers and that getting new staff would be a challenge. Why though? Is it not just like filling a job in any other organization?

This takes me back to the Honeymooners analogy. Out of the general population, not many people were pursuing working in the sewer system because society did not deem it a positive career. We do know that these positions require a learned skill set over time and the jobs pay well and it is literally lifetime employment.

The general public has become more interested in sewers with the connection to keeping our environment clean. I believe individuals may choose a previously overlooked vocation in the sewer system once they understand the salary and job security. However, this will not change in weeks or months; it will most likely take time to garner the skill set for senior positions.

As I have written before, there is an opportunity for veterans returning to the USA if they choose to obtain work with the city. Or, perhaps it is the chronic unemployed who get laid off during every economic downturn and want more stability. Perhaps a better use of an outside contract would go to a company to help the city set up an apprentice program, so people with entry-level skills could learn the ropes and all the positions are permanently filled.

In an organization like the city, which has thousands of employees, 11 unions and a litany of job titles, it is nearly impossible to pay certain positions more within a union because it requires negotiation. If one job classification has people who work in the Water Pollution Control Plant and also work in City Hall, the increased salary must go to both even though they are inherently two different jobs. In any other organization you could simply raise the salary of that specific job, but that is not the case in municipal government. This instead must be dealt with in the long, arduous and secretive meet-and-confer process with the union.

Issues like this one would seem to be an easy matter, where the discussion could be held in public so we could get to “yes” faster and allow everyone to understand the details easily.

Also posted in Business, City Council, City Hall Diary, Culture, Education, Unions | Comments closed

The Importance of Santana Row

Ten years since it opened, Santana Row remains a premiere destination and tax revenue jackpot for San Jose.

Santana Row will be celebrating its 10th Anniversary this year. It has provided a new destination for Bay Area residents as well as additional tax revenue for San Jose.

Santana Row is a unique place that draws people from outside of San Jose and has people talking about it across the country. People I know who typically did not visit San Jose years ago do frequent Santana Row today. The same visitors spend money while enjoying themselves in the 95128 zip code. The cultural diversity at Santana Row is amazing, with nearly every nationality represented and many first-generation immigrant families strolling The Row day and night.

To some it is a “Disney Downtown,” because it was fabricated from the ground up. To others it was a development that slowed down the potential of our own downtown. One could argue that an expanded Valley Fair mall did more to impede retail growth in downtown.

To me, Santana Row is a success. As much as I enjoy urban centers like our downtown, I also enjoy the sheer intensity of Santana Row with approximately 1,000 on-site residents and a hotel, offices, restaurants, marquee retail, movie theater, tall buildings, etc. All of these things together make Santana Row unique.

I have heard Santana Row brought up many times in reference to urban planning, and that it is ideal for pedestrians—there something interesting to be seen by the walker. Residents across San Jose often voice opinions about potential new developments in their own neighborhood and ask if they could get something like Santana Row. It would be nearly impossible to replicate, however, the principle of significant housing over retail and office is a good one and promoted in our newly adopted General Plan.

The millions in sales tax revenues generated from Santana Row is often discussed and the good fortune it brings San Jose. One example is when people buy a Tesla car from the store at Santana Row. The Tesla store at Santana Row has broken foot traffic records and is second in the world for actual sales of the electric car out of nearly 20 stores worldwide. The assessed value of this parcel and surrounding parcels skyrocketed through private development, which brings property tax revenue to many levels of government.

Besides direct sales tax and property tax revenues, Santana Row provides the opportunity to capture high-paying jobs through the development of substantial new office space. On Tuesday, the City Council will consider approving a large office building at Santana Row instead of housing. This new 240,000 square foot office building will provide an attractive option to companies locating in San Jose. Some companies will view Santana Row as a perfect fit for their employees and clients, because they can simply stroll to great amenities. Also, the opportunity for a company to have its brand shown with massive visibility is better than an office park.

As other cities to the north have developed new office parks, this impedes San Jose’s ability to draw in new, fast-growing companies from the peninsula that are searching for office space. The new office parks to the north entice companies that are looking for new space that in the past would have gone to North San Jose. However, Santana Row is a true differentiator, as the new office parks in other cities have virtually nowhere to go for the employee by foot—only by car.

The net new job potential of Santana Row is why I strongly opposed the rezoning of land last year from commercial to residential adjacent to Santana Row. Keeping the space open for business provided another opportunity for a potential corporate headquarters.

I still root for our downtown—especially August 10-12 for the Jazz Festival—but we should not miss opportunities at Santana Row.

Pierluigi Oliverio is a San Jose councilmember for District 6

Also posted in Business, City Council, Culture, Downtown, Santana Row | Comments closed

Prioritizing Future City Spending

At the upcoming Aug. 7 City Council meeting, the discussion will focus on how to prioritize city spending IF revenues increase. So, in the example below, if revenues increase by $10 million—either by revenue growth or tax increase—this is how I think it should be spent by percentage. We will still be spending money on all of the city services included in the current budget, however, this example is for future potential revenue that is above the budget passed in June:

53% — Police $5.3M
15% — Road Paving $1.5M
5% — Planning, Building & Code Enforcement $500K
4% — Libraries $400K
2% — Tree Planting & Tree Trimming by Our City Forest $200K
2% — City Attorney’s Office $200K
2% — Information Technology $200K
2% — Pedestrian & Bicycle Safety-slowing cars down in neighborhoods $200K
3% — Pay down Debt $300K
2% — Save Money for Rainy Day Fund $200K
10% — Discretion of City Manager with Approval by Council to be Distributed to Human Resources, Finance, Public Works, Economic Development and/or a Need That Becomes Apparent in the Future $1M

There is no extra allocation for the Fire Dept., as Fire Chief William McDonald and staff have been successful in obtaining federal grants. Federal grants are great in the short term, but they will make it more difficult to allocate future funds to hiring police officers—which is why the majority of future revenue is allocated to police. In addition, I agree with the 2011 Santa Clara Civil Grand Jury that San Jose could utilize three firefighters on a fire engine like every other city in the county. The data in San Jose shows that calls for service are 4 percent structural fires and 96 percent non-fire calls, mostly medical. Any cost savings from realigning resources to match call data should go to police.

We need to allocate general fund dollars to the Planning Department rather than increasing and relying on fees. Development can be sped up this way, increasing our tax base and private sector employment base to fund city services. Funding of Code Enforcement to keep our city safe/looking good and also could bring in revenue by assessing fines to irresponsible property owners—especially apartments that are ill kept.

Adding some funding to libraries is good, but much more can be done with volunteers to keep the doors open than is done today.

One way to make San Jose more visually attractive is through more tree planting, including maintenance, which also has other positive environmental attributes. Putting 5 percent aside to pay down high interest debt and save for a rainy day fund is prudent. Allocating something, even though small for Information Technology, must be done to achieve efficiencies and put a down payment on upgrading the financial software of the city to enable more sharing of financial information with the public.

The city manager, as chief operating officer, needs flexibility in allocating funds where the council or general public may not be aware of the need today. Of course, any action should require Council approval, but 10 percent between so many different needs may not provide enough. The city manager will have to make do.

Also posted in City Council, City Manager, Firefighters, Libraries, Police | Comments closed

Borrow or Pay Out of Pocket?

The Council last week made the second SERAF payment to the state. SERAF is where the State raided all RDA coffers in California—again—in our case taking $75 million from San Jose.

The state allows payment of the SERAF to come from the housing department if a city chooses to do so. This second payment of $13 million is due this week so Council had to decide to pay or perhaps not pay or even to cease RDA operations. I have advocated paying the state with housing department funds.

What was decided, however, was to issue commercial paper to replenish the housing department as a way to finance the payment. Yet there is more than $13 million on hand in the housing department that would not require borrowing.

Ultimately the general fund is at stake for commercial paper, in the same way that the general fund is on the hook for the Hayes Mansion and golf courses.

I voted no, since I felt “Why borrow when you have cash in your pocket?” We do not get “miles” or some other reward for borrowing.

I understand that we would not be able to continue with two more affordable housing projects if we did not borrow, but felt that was OK since neither project will be paying property tax to pay for city services. I could contemplate borrowing if we were going to get something like road repair but in making a payment to the state I would rather just pay it and be done with it.

RDA was not meant to last forever but the recent settlement with the County of Santa Clara, which included the old city hall and was approved in closed session, makes closing the RDA even more complicated.

Also posted in RDA | Comments closed

What Happens in Vegas…

The saying, “What happens in Vegas stays in Vegas,” can be said for the City of San Jose’s closed session meetings. In a prior blog, I wrote about what I could of closed sessions called The Mystery of Closed Sessions.

Closed session attendees sign a paper with legal verbiage at each meeting signifying the importance of confidential information shared at the meeting. As mentioned in my prior blog, closed session tackles topics like labor, litigation, real estate and personnel matters.

As a side note, I was able to attend several of the public labor negotiation sessions involving the city attorney union. I found the process valuable. Valuable to hear both sides discuss their viewpoints live, and it served the attorneys well from my perspective. I hope other unions take their negotiations public in future years.

Quite often in closed session the Council will take votes on important items even though the public does not have the opportunity to hear what is said or voted on. The information shared and comments made in closed session is not supposed to leave the room. These can be on important matters, however again the vote cannot be revealed.

So, what I can say, there is sometimes vigorous debate and not all votes during closed session are unanimous. I understand the need for closed session but feel that I am restricted in saying what I said or how I voted. Videotaping closed session for me would be alright in case it was needed in the future. We do audio-record real estate discussions currently in closed session today so perhaps closed session will keep evolving. For me I would just as well have the closed session as a public session, however what I may want may interfere with the right of another.

Also posted in Closed Sessions | Comments closed

WeePeeCeePee

The water treatment plant in Alviso will soon be able to make wastewater potable. Robert Dawson photo.

Last week, the City Council moved forward with an Environmental Impact Report (EIR) for the water pollution control plant often referred to verbally as “weepeeceepee” (WPCP). The plant and the land are jointly owned by San Jose and the City of Santa Clara.

There are competing interests on what to do with the area surrounding the plant. Some would like all of open space land preserved for natural habitat for the burrowing owl and other animals. Others would like to the area devoted to large parks with trail connectivity. Still others look to this as an area where San Jose could add office and retail opportunities to increase the tax base.

A permanent decision will most likely not be made until the EIR is completed in a couple years. However, what we do know now is that we must spend some money on updating the WPCP so that it continues to work and comply with federal regulations.

Perhaps with such a great land mass, there might be something for everyone? Would it be possible to have land for jobs, open space and a park? Do we try to please everyone or choose one option and stick with it?

Speakers from Alviso spoke about their concerns regarding added traffic to their area and shared concerns that any new retail would take away from the limited existing retail that is currently in Alviso.

This area is also where the advanced water treatment plant is being built that will take waste water and turn into clean potable water. Actually, this water will be cleaner than current tap water and certainly bottled water. This simple fact is important in the education process of consumers in water consumption. It is expected to open in June 2012.

Staff shared an extensive power point at the council meeting that I have placed on my council website as I have done with other staff presentations for you to view. The presentation is more visual and perhaps easier to understand than a long report so I encourage you to click on this link: City of San Jose District 6 Staff Presentations. From there, click on Water Pollution Control Plant Master Plan: April 19, 2011 to view and learn more. This power point is the bulk of this weeks blog. Appreciate any comments you can provide from what you discern on the power point presentation.

On another topic, the District 1 and 3 budget meetings had comments from actual residents this week. To summarize, people wanted the council to fix the structural budget problem so we can restore services in the future. A woman at the District 3 meeting, who is a volunteer at a community center, said she and her neighbors understand that the City has no money and to “Just do your best and God bless.”

Also posted in Budget, City Council, Water Pollution | Comments closed

Paint Over Walls Or Paradigms?

Graffiti abatement in San Jose costs the Parks & Rec department $1.7 million per year. Local residents occasionally chip in to help.

I attended the District 5 (D5) community budget meeting last week—it was the third D5 community budget meeting I’ve attended. Approximately 50 people were there, with the majority being city employees. Many of the speakers shared emotional testimonials.

One speaker stood out to me. She shared how cutting of library hours from 4.5 days to three days a week would cause a large burden to her neighborhood. She teaches music at the Hillview Library and is close to the youth who rely on the existing library. She said keeping library hours open in her neighborhood was important since she feels her neighborhood has a higher need than other areas.

This theme was prevalent. Another woman brought up that since D5 has a higher crime rate, then why not keep D5 libraries open and close District 10 (D10) libraries since crime is low there? I have asked the same question before. Should library hours be based on need? How do we determine the need? Crime stats? Census date by race and income?

Another person was concerned about the police layoffs and how they need more police in D5. Truth is we do allocate more police to D5 than D10, for example. Since there are more calls for service in D5 than D10 our police force plans accordingly.

Another felt D5 had not gotten its fair share of capital projects compared to other districts. This one would take some research but I think it is fair to say between the Redevelopment Agency spending through the Strong Neighborhoods Initiative ($105 million for a third of San Jose), Fire Station 2, Mayfair Community Center, Alum Rock Library, Hillview Library, Mexican Heritage Plaza, to name some projects, the last 10-15 years was better for D5 than the previous period of historical neglect.

The other major issue of the night was the option of outsourcing to save money and retain a city service. The one that got the most discussion was outsourcing the anti-graffiti painting currently performed by city employees. It was felt that the painting of walls was too important to outsource and instead should only be done city employees. Currently it costs $1.7 million to do this service and the Parks Recreation Neighborhood Services (PRNS) Department (which runs this program) estimates it could be done for $1.1 million which equates to $600,000 in savings by keeping the service but providing it a different way.

The employees who perform this work have shown up at each budget meeting to speak against the outsourcing. This service is really needed in D5; I witnessed to and from the meeting that there was substantial tagging. The sheer amount of tagging I witnessed gave the appearance that the City does not offer this service today. Speakers at the meeting felt that city staff would work harder than a private contractor. One option might be to outsource half of the city to a private contractor and the other half to city employees and judge it in a year. However, this would not generate the total savings needed to balance the department budget and thus provide this service.

The savings in outsourcing park maintenance looks even higher. The current cost for only maintaining small parks under two acres and park bathrooms is $4.1 million where if it was outsourced it is estimated to be only $1.3 million for a savings of $2.8 million.

I understand that some people will lose their current job through outsourcing and may go to work for the private contractor earning less, but the City’s responsibility is to provide services for 950,000 residents. The employees who may lose their job did nothing wrong, it’s just a sign of the times that the City needs to re-look how it can continue services and save money. The City saved $4 million last year outsourcing janitorial at the Airport and City Hall and everything is just as clean.

Last week, at the District 7 (D7) budget meeting, a career Navy veteran advocated for opening the Seven Trees library, which is completed but not yet open. However he went on to say that there should be immediate changes to the pension system. He mentioned how he receives a 30 percent pension for 25 years serving our country in the military.

Also posted in Budget, District 5, Outsourcing | Comments closed

A Tap on the Shoulder

The citywide Community Budget meetings started last week with the city manager and other city department heads in attendance to answer questions. Ten public meetings will be held with one meeting in each Council district.

This first meeting was held in District 2 with approximately 100 people in attendance. From my perspective of recognizing faces, listening to questions and subsequent applause, approximately 80 percent of those in attendance were city employees. The high ratio of employees is understandable, since most employees would attend a meeting if their employer was discussing layoffs.

Government has a much softer and proactive approach to layoffs than the private sector. For example, I was laid off twice myself due to market downturns and in both cases I did not have advanced notification that I would be let go. Instead, I, like many, got a tap on the shoulder from HR and a two-week severance check. Although it is stressful to know that layoffs are looming, at least one can plan accordingly rather than having the HR shoulder-tap, which, unfortunately happens often in private sector.

The mayor spoke at the meeting and answered questions from the audience. After he finished, Ed Shikada, our assistant city manager, walked through a presentation of the budget deficit and some of the alternative cuts that might be selected by the city manager in arriving at a balanced budget. The presentation was followed by Q and A. This week there will be meetings in District 5 and 7.

There was a survey card that was distributed at the end of the meeting that asked a few questions. I put the five questions on the internet for you to answer in case you are unable to attend the nine remaining meetings: 2011 San Jose citywide Community Budget meetings.

Also, last week San Jose welcomed a new clean tech company to North San Jose. Wrightspeed Inc., designs digital drive systems to replace conventional power trains for commercial vehicles. Trucks that have Wrightspeed drive systems installed do not consume as much fuel, providing cost savings to the vehicle fleet. California spends $150 million a day on fuel, placing the state in third place globally for consumption of fuel, behind the United States as a whole and China.

Why would Wrightspeed, which started in Burlingame, move its 20-plus employees, mostly engineers, to San Jose? The company moved to San Jose because of our Office of Economic Development. Wrighstpeed was part of the Clean Tech Open that the City of San Jose sponsored (marketing). A connection was made by staff at the event (sales), who kept in touch with Wrightspeed.

When it came to looking for a new building, our staff facilitated a search and found a building within our Enterprise Zone which makes Wrightspeed eligible for state tax credits on hiring new employees. (Gov. Brown has proposed eliminating Enterprise Zones). In addition, San Jose has a foreign trade zone which allows Wrightspeed to import sub assemblies from Europe without tariffs, to put into their end product. Wrightspeed will also generate sales tax for the city of San Jose since they sell a physical object.

It is important to always be focused on growing our economic pie but it does not always happen if a city does not have a sales team.

Also posted in Budget, District 5 | Comments closed

The Social Contract

In society we have chosen to give up some of our liberty or ability to do anything we want for the the trade off of having more opportunity under law. If we do not like the rules of society than we can move away to a remote mountain and have more freedom, but one would give up certain benefits we have in society based on law.

The social contract is reinforced through friends, family, neighbors and those who interact with us in society. However, the enforcement is done primarily by our law enforcement personnel and internationally by our military.

Police are the ones responsible to respond when individuals choose to cause harm to others’ physical well being. Without adequate police, people may choose to break the contract, whether it be by comitting a robbery, an assault or murder. From my viewpoint, police maintain the social contract. No one else carries the authority to do so, and ideally, always in a fair manner, which carries a high level of responsibility. A high level of responsibility needs to be compensated well, in part to avoid temptations.

In comparison to other city departments, the police department is the only one that maintains order so those who are weak do not get picked on and those that are law abiding can go about their way. Would we want to return to the Wild West when gun fights occurred outside the saloon between individuals? Who would want to worry about those things today at Happy Hour? Police on patrol deter crime by simply being visible. This deterrence, I believe, leads to less incidents that require emergency services since the inhibition of criminal behavior means less use of the 911 system.

Government does have enforcement through regulation, but only law enforcement really enforces the regulation with the possible outcome of incarceration. It is a great power and must always be overseen by civilians who allow autonomy but expect fairness to be carried out.

Sadly, during these years of low revenue and escalating pension costs we must always consider what we can afford. There is a higher cost to being out of control. The social contract extends to our police, as that they must be diligent, be fair, and understand fiscal realities we face, and thus our ability to pay. At the same time, the policy makers must prioritize with the social contract in mind, not to be held hostage but to always put this in the balance with other choices.

Technology can help with enforcement by using surveillance cameras to ticket red-light runners, capture vandals on video to prosecute property crimes and use video footage for gathering evidence for prosecution of other types of crimes. The ability to maintain a civil society will evolve with technology. If we do not accept technology than we will fall short of our goals since we will never have police covering all places all the time.

In other matters: Tonight at City Hall there will be a showing of the documentary film, Bag It, with a discussion to follow with the Director of Environmental Services. The film presents the impact of plastics in society and their ramifications to our health. To learn more email tina.west@sanjoseca.gov

Congratulations to San Jose Made and San Jose Eats who brought what seemed to be a few thousand people to Downtown on Saturday afternoon for a pop-up retail and food truck event. The event also had the impact of filling every restaurant in San Pedro Square. A sign posted out front of one restaurant read: Closed-Out of Food.

Also posted in Police | Comments closed

Comments on Firefighters Contract

San Jose’s Fire Station 6 was put on the chopping block in 2008.

Last week the council took up the firefighters union contract with more than 100 firefighters in attendance. I thought I would share why I voted no.
First, I think it is clear that if you have worked in city government over the years that things are drastically changing due to structural budget deficits. Second, if you are new to working in city government, you will most likely not have the same career as those before you.
I remember when I was a candidate for city council and meeting with the fire union. We covered a variety of topics but I always remember this question: “How would you help us with city management on wage and benefit negotiations.” I recall saying that I would attend the union negotiations myself. They were quite happy and said that was a great response. However, the firefighters union did not inform me then of the reality that labor negotiations are not open to council members.

I appreciated the 10 percent concession and was surprised that it did not go through binding arbitration. I believe the new interim president of the union is a sincere person.

Even with the 10 percent and after vacancies and retirements, we will still lay off more than 30 firefighters. However, the larger item which remains is minimum staffing for fire engines. I have brought up the minimum staffing issue in council meetings, committee meetings and budget meetings.

The LAFCO report on all Santa Clara County fire departments shows that San Jose is the only city in the county that has four firefighters on an engine. Also looking at the same report it shows we have an over 25-to-1 ratio in calls for medical vs. fire.
I believe we should lower the amount of medical calls when council approves the ambulance contract with the County. County government, by state law, controls the ambulance contracts. We should stop having our fire fighters respond to calls that are not necessary, like those at the county jail, since they already have medical personnel at the jail. In addition, low priority alpha and bravo medical calls should be left to ambulances.

Other cities as mentioned above are able to make do with three on an engine. We may want four on an engine and we may even want five, but we cannot afford it. This does not mean every engine would have three instead of four, as not all stations are equally busy, and therefore it provides the flexibility to keep stations open. Residents are not so concerned if there are three or four on a engine, but they do care if the station is open or closed.

Because of minimum staffing requirements in the recently accepted fire contract and the unavoidable layoffs, we would close fire stations.

Back in 2008, when Station 6 was a line item to be sold in the city budget with zero notification to residents, I initiated the policy passed by the Council that mandates mailed notification to residents and two evening public meetings with the presentation of data for the primary service area when fire stations are proposed to be closed. Most importantly, it does not allow a station closure to be included in the budget prior to the prescribed outreach. Before this policy fire stations could be sold/closed with no notice.
So like the Communications Hill neighborhood, which now has a closed fire station, other fire stations somewhere in San Jose will need to be closed due to minimum staffing. It is unfair to residents that we close stations when they can remain open with one less person to maintain response times based on distance.

If the council does not want to see fire engines taken out of service than we will need to makes cuts elsewhere. The most likely place for those cuts will be our police department, with the laying off of police officers.
We do not have a minimum staffing requirement applied to police cars for police officers. If police run short on a shift they do not say “let’s stop patrolling in Almaden or Berryessa.” We do not have minimum staffing for our libraries. We do not have minimum staffing for our planning department to process an application for development.
This comes down to what is most important for San Jose in 2011 with the limited taxpayer dollars that are available to allocate. For me the answer is simple. It is police. Police enforce the social contract. No one else does.

The social contract allows individuals to be free from harm and intimidation.

The social contract allows the weak to be protected.

We cannot do everything. In fact we can’t even do both…police or fire. So we have to choose.
This fire union contract makes the fire department the number-one priority in the city budget by maintaining minimum staffing on fire engines. I cannot say this is my number-one priority nor my residents’ number-one priority when we provide multiple services to residents.
With that said, I vote against funding charities even when they are great organizations; they are not in the city charter. In addition to voting against the Hayes Mansion, golf courses, million dollar IT projects gone wrong or championing $1.475 million in cost avoidance on a current IT project. I voted against $1.3 million on golf nets, rezoning industrial land to residential, affordable housing that does not pay property tax. And I support outsourcing of services like janitorial to save money for core services.
I think it is wrong for myself as an elected official to make promises to every group or specific union when the reality is restricted resources do not allow promises to be kept.

Also posted in Budget, City Council | Comments closed

Why a Unanimous Vote?

The vote on the convention center has been covered extensively, but a resident I spoke to asked me to please share my view on San Jose Inside. As we know, the Council vote was unanimous in supporting the renovation and expansion. Although I cannot speak for my colleagues, I would say there were four major constituencies who advocated for the renovation and expansion of the convention center.

1. Building Trades & Building Industry. Public works projects pay prevailing wage and will provide construction jobs for the next two years in an industry that suffers from 30 percent unemployment. In addition, as the economy is slow, the cost to build is lower.

2. Local hotels have taxed themselves to pay for the bonds that will pay for the renovation and expansion. The hotels did not tax themselves to pay for parks and code enforcement. Hotels want more room nights, which is the key to their success. The hotel tax makes the bond payments, not the general fund.

3. Team San Jose wants a convention center that is the best it can be to market its usage and close deals on convention and event business.

4. The Downtown Association is an advocate for investment and activity in our Downtown. Whether you value our Downtown or not, a substantial investment has been made to create a city center. The convention center drives activity and business in our Downtown.

If you think about it, convention centers are located globally in major cities. In most cases, they are loss leaders to bring travelers and spending to their respective town. Or you may feel that convention centers are a subsidy to the hotel industry or a subsidy to adjacent private property owners or a subsidy to airports or a subsidy to unions or all of the above.
The global convention traveler generates tax revenue with hotel taxes, sales taxes and airport taxes for the respective city, and in turn creates jobs for the hotel, convention, restaurant, airport, taxi and retail worker. In very few cases, such as Las Vegas, convention centers are profitable.

Personally, I would have liked to have had the Council study selling the convention center to a private entity, but there is zero chance of getting that passed on the Council and I pick my battles.

So—we are in the convention business and therefore responsible for upkeep to the existing facility. How do we pay for it? The reality is that if the renovation was not covered by bonds paid for by the hotels it would come up out of the general fund. So replacing the HVAC system and other core improvements ($46 million) would have fallen on the general fund.

Another factor in the decision was the design-build process. When it is said the expansion will cost $63 million, it will really cost $63 million. As design- build says, “here is my budget,” thus build it for this price or else, since I do not have any more money. This is the same process that was used at the airport and which was delivered on time and on budget. Bill Sherry, who headed that endeavor at the airport, will be overseeing this project as well. Mr. Sherry, now in charge of Team San Jose, is well respected and the Council is confident in his capabilities.

I am not bullish about all convention centers due to technology like web meetings and the modern day hassles of travel. However, I would not have supported this renovation and expansion had the hotels not taxed themselves. The hotels have been a collecting a 4 percent tax since July 2009 that will cover the bond payments. In case the 4 percent tax falls short there will be an additional 1 percent tax collected from the hotels.

There is risk. For example, if we had a major earthquake that destroyed a Downtown hotel that then was unable to book rooms for several years we would have risk to the general fund. However I am guessing if that earthquake comes to pass we will face larger issues like looking for canned food.

The only public testimony at the council meeting came from a retired city employee who is on the executive committee of the San Jose Retired Employees Association. His comments, and those that were sent to Council, were in favor of renovation and expansion, stating that now is the time. I understand there will be criticism of strategic decisions from some but at least let there be criticism with a 360-degree view.

Also posted in McEnery Convention Center, Team SJ | Comments closed

Broad Support for Performance Evaluations

After much discussion at the City Council meeting last week the Council voted in favor of having city staff study performance as a criteria when it comes to employee layoffs.

The review will determine if the City should include job performance when considering layoffs, or keep the current system in place, which is based solely on seniority. Due to budget shortfalls, the City has eliminated “vacant positions,” which were budgeted with the intention of hiring someone to fill them. Elimination of those positions generated savings, since the savings came from no longer budgeting for the positions.

As a result, the City is forced to do layoffs, based on seniority only. For example, you may have someone on the job for nine years who is under performing yet someone who has been on the job for six years and is a great worker. The person who has been with the City for nine years will “bump” the better performing employee, in the same or different department.

In some situations the person going into the new position does not have the skill set to do the job. This causes disruption to that department and disruption to the client (residents, business,etc). For example someone who has never stepped foot in the water pollution control plant now has a job at the plant, which requires a special skill. Skill sets and domain expertise are lost when people bump to other departments based only on seniority.

There are two points which I think get overlooked in this debate. One: My proposal does not eliminate seniority as a measurement but instead adds performance as a factor. Whether performance will be 10 percent or 20 percent of the total criteria remains to be seen. We may eventually also decide to include education and certification as well. We need some way other than months on the job to make a informed decision.

The other item being overlooked is that performance should be considered when getting a raise or a promotion—not just the current situation of layoffs. Today, salary step increases are rewarded only based on seniority. Adding performance as a criteria should also be considered.
In addition, city staff will study the current evaluation process, which has not always been followed. Some say that evaluations do not matter since the current system is only based on seniority. I would personally be interested in a affordable software evaluation solution so that HR can track all evaluations in real time, and that there is a standard format with the option of allowing some customization of questions for specialty jobs.

I am surprised that this issue was not resolved in prior decades and that there is strong opposition from the leadership of public employee unions. Several city employees in different departments have mentioned to me that it is disappointing to work with someone who does not carry their weight. This is about civil service rules and not about unions, however there will be a lengthy meet-and-confer discussion with the 11 unions. In comparison, the numerous building trade unions do not have seniority and bumping. Union trade members are hired and fired based on work performance.

Seniority is being raised also in Los Angeles, where the ACLU has won in court against the school district, by Mayor Antonio Villaraigosa, a former teachers union organizer. “We cannot continue to automatically guarantee lifetime employment to all teachers,” Mayor Villaraigosa said, “nor can we make decisions about assignments, transfers and layoffs solely on the basis of seniority. Tenure and seniority must be reformed or we will be left with only one option: eliminating it entirely.” If a former union organizer and now Democratic Mayor of California’s biggest city can support performance evaluations, plus 79 percent of San Jose residents, so to should the San Jose City Council.

Congratulations to Arizona-based Microchip Inc, a veteran semiconductor company. They recently located their Silicon Valley office to San Jose from Sunnyvale filling up 100,000 square feet in North San Jose.

Saturday, the Willow Glen Rams defeated the Burlingame Panthers for the division two boys varsity soccer championship. It was first championship soccer win for Willow Glen. Congratulations to Julio Morales who scored two of the three goals.

Ten seats remain unclaimed for tonight’s 6:30pm showing of “The Olmstead Legacy” at City Hall. Please email me to hold a seat(s) atPierluigi.Oliverio@SanJoseCA.gov

http://www.theolmstedlegacy.com/

Also posted in Budget, City Council, Unions | Comments closed

We Pay Twice for Affordable Housing

In past blogs I have expressed my concern about the cost to our city of too much housing. Specifically, housing that does not pay its own share of revenue. One example I have pointed out—and constantly been the lone vote against—is affordable housing.

We run the daily operations of our city with tax revenue. The city does not write paychecks signed “goodwill” or “number-one provider of affordable housing,” but rather with dollars backed by tax revenues. So when we add to the housing stock by approving, for example, an affordable housing project that does not pay property tax, road-paving fees and only 50 percent of park fees, it is a net loss for our city. Therefore existing residents subsidize city services for the new residents.

Annual property taxes in San Jose are needed to pay ongoing salaries and benefits of employees. Road-paving fees go towards paving streets in San Jose. If you ride a bicycle or drive a car you know that we need every dollar. Park fees allow for new parks or increasing the size of current parks so we do not wear out the existing park infrastructure in established neighborhoods. For years developers were exempted from paying park fees for affordable housing projects which created more residents but not enough open space. However last year with the support of the city council I managed to get it changed to where developers must now pay half the park fees that market-rate housing pays.

The other item of interest is that affordable housing generates extraordinary calls for service from our police. Attached is a snapshot of data for eight affordable housing developments in San Jose and the calls for police service. Since there are more calls for service around these affordable housing projects, over time our police department may schedule more police in this area to manage those calls. This may translate to less police coverage in other areas of San Jose, perhaps where you live. In addition, our fire department receives more medical-related calls, and again there’s no tax revenue to pay for the employees.

So we pay twice. Once, by exempting taxes and fees. Twice, by higher use of city services than existing residents. (Also, most of these projects were financed with RDA funds, and the State of California mandates that 20 percent of that money be spent on affordable housing. And many of these projects were put in places zoned for jobs and not housing.)

Out of the many suggestions I have made on this topic I believe affordable housing developments that have too many calls for service should hire an off-duty officer and/or ambulance to be there on site.

Here is a link to 730 police calls on eight housing developments, among some 11,000 units built.

On another topic, one of my favorite Downtown events starts Tuesday night, The Cinequest Film Festival. Check it out at Cinequest.org.

Related to cinema I obtained a documentary film about urban parks directly from the filmmaker called The Olmstead Legacy. Monday, March 7 at 6:30PM will be the premiere showing in San Jose at City Hall. Find out more about The Olmstead Legacy here. The film will be followed by a discussion on urban parks. The event is near capacity; please email me if you want to reserve one of the remaining seats at Pierluigi.Oliverio@SanJoseCA.gov

Finally, the bipartisan Little Hoover Commission, an independent state oversight agency, made its recommendation to Governor Brown about pensions last week:

Read the Feb. 24, 2011 Little Hoover Commission Report here.

Also posted in Affordable Housing, City Council, Parks, RDA | Comments closed

2011 City of San Jose Community Budget Survey

The City of San Jose contracted with a public opinion organization to conduct a telephone poll of 1,000 San Jose residents. Residents will be asked survey questions about the budget and city services from Jan 13 to Jan 17.

The results of the phone survey will be shared in February. Please note I received a draft of the survey and some of the questions have been edited.

Since only 1,000 people will get a call out of one million residents, I wanted to provide an opportunity for you to partake in the survey via the internet.

http://www.surveymonkey.com/s/RG9LCPN

This survey closes Jan 30.
If you appreciate urban parks than consider attending the San Jose premiere of The Olmstead Legacy film. March 7 at City Hall. For more info click here:http://tinyurl.com/OlmstedLegacy

Also posted in Budget, Parks | Comments closed

Civil Service Rules

The City of San Jose has adopted Civil Service Rules that state what is and what is not allowed in regards to employment. The City Charter allows for changes to Civil Service Rules by a Council vote, and does not necessarily require a city-wide election.

SECTION 1103. Civil Service Rules; Manner of Adoption.

Civil Service Rules for the Classified Service shall be adopted, and may from time to time be repealed or amended, by ordinance of the Council. Upon adoption, Civil Service Rules shall have the force and effect of law.

The Council may adopt, repeal or amend any Civil Service Rule for the Classified Service, provided it first receives from the Civil Service Commission a report or recommendation with respect to the proposed new Rule, if a new Rule is proposed to be adopted, or with respect to the proposed repeal or amendment of an existing Rule if an existing Rule is proposed to be repealed or amended; provided, however, that if the Civil Service Commission refuses or fails to submit to the Council a report or recommendation on any proposed new Rule, or proposed repeal or amendment of any existing Rule, within ninety (90) days from and after the date the Council requests such a report or recommendation, the Council may adopt such new Rule or repeal or amend such existing Rule, without first receiving a report or recommendation thereon from the Civil Service Commission.

The years ahead for local government will be tough, as property tax revenues will continue to be low and the true costs of pensions are revealed. If layoffs are inevitable, then let’s examine the current system of layoffs by seniority.

The current method means we lose some of the most productive people and create a large age gap if/when we are in the position to hire down the road. Instead, perhaps we should look to see if there is an alternative that might involve employee performance as well as seniority. Maybe only lay off employees who are evaluated as “needing improvement” before laying off productive employees with less seniority. Or if two employees have nearly equal seniority, leave some allowance for merit—such as education, training, evaluations and certifications—to be used in the final determination.

Also, we should explore allowing those that are closer to retirement the ability to choose on their own accord to retire early in a way that would still provide the savings to balance the budget. Employees with more seniority are paid more than those with less seniority, so a change may allow fewer layoffs of city employees that provide services to residents.

I believe the Civil Service Commission, chaired by Bill Brill, business representative for IBEW union Local 425, should review and give their recommendation to the City Council in 90 days per the City Charter.

Thanks to Friends of the San Jose Rose Garden who hosted a great volunteer event on Saturday. Many unpaid volunteers braved the cold to help keep the park looking great. Special thanks to Terry Reilly, Beverly Rose Hopper and Myles Tobin for the heavy lifting.

Click this link for a short video of Saturday’s volunteer event at the San Jose Rose Garden.

Also posted in Budget, City Council | Comments closed

Choose San Jose

San Jose is currently looking to find a Director of Economic Development. As The City embarks on this search, what qualities do you feel this person should have? Should they have a background of some particular flavor like commercial real estate, a housing developer, former elected official, lobbyist, economist, academic, small business, large business, tech background, etc? Should they be currently employed at another city? Should it be a local city or further away? Should it be a young person with a limited track record but strong potential or someone with a strong track record making San Jose their final stop?

All cities need planning. However, any plan, no matter what the plan, is subject to criticism, especially in San Jose. I think collectively there are a lot of ideas out there and not all of them new but sometimes the criticism rises higher then positive thoughts. Kim Walesh, our interim Director of Economic Development is certainly qualified. However, she is not interested in this permanent position. So the quest is on for this new unnamed person.

Does any particular person come to mind who would be good for this job? Would anyone high-caliber candidate want the job? The position pays approximately $200K in total compensation. (216 people made over $200K working for the City of San Jose in 2009.)

The City of San Jose has rolled out a new website showing our positive attributes for companies considering expansion or moving to San Jose. In past blogs I have mentioned a few companies relocating to San Jose such as Maxim, Atheros and other smaller VC-funded companies, which is good news for San Jose. Below is the new “Choose San Jose” website which is partially the work of the Office of Economic Development. What do you think of it?

http://www.choosesanjose.com/

I do not believe an economic director will be the salvation for any given city as much of the success or failure is dictated by the movement of capital and the free market. Yet having a strong communicator that makes sure each piston of the City’s engine is hitting when the free market brings San Jose an opportunity would be ideal. In the meantime, if a strong economic director can convince elected leaders to not convert industrial land to housing that would be great start.

Also posted in Economics | Comments closed

Synchronized Swimming

Last year, the council was faced with cutting the aquatics program down from ten pools to two due to the budget deficit. Stuck between a rock and a hard place the council invoked the “Unique Service Purchase” clause.

4.12.235 Unique services purchases.
The procurement authority may initiate a procurement for unique professional or other services where the procurement authority determines that an unusual or unique situation exists that make the application of the requirements for competitive procurement of a services agreement contrary to the public interest. Any special procurement under this section shall be made with such competition as is practicable under the circumstance. A written determination of the basis for the procurement and for the selection of the particular contractor shall be included by the Procurement authority in the department files.

Simply stated, this allows city staff the flexibility to outsource. In this case, the aquatics program was outsourced to both non-profit and for-profit groups. This simple action allowed the city to open seven additional pools for a total of nine pools instead of two that were budgeted.

At the Dec. 14 council meeting, staff reported back to the council on the results of the aquatics program. Residents gave the program high marks, with 91 percent rating the service as positive. In addition 1,000 more swimmers used the pools this summer over last summer. Staff said that outsourcing of the pools was “seamless.”

I think it is great we were able to give residents services they enjoy but without the traditional cost.

The City continues to cover maintenance and utility costs, however with multi-year contracts I believe we can get most of these costs covered as well, and even extend the swim season. This is a positive example that outsourcing can provide services to residents. This is a positive example that outsourcing can provide services to residents.

Congratulations to Maxim Semiconductor for purchasing a building in North San Jose. They will soon be relocating their 1,200 employees and corporate headquarters to San Jose. The City of San Jose through the Office of Economic Development offered $500,000 in business assistance programs. Luckily the City of San Jose was prudent and has a little money put aside for economic development.

Also posted in Budget, Outsourcing | Comments closed

Is Employment Lands Framework Dead?

Tax Base Erosion Night lived up to its name last Tuesday at the Council meeting as a truck drove through the Employment Lands Framework. Council voted 8-3 to amend the General Plan and allow new townhouses instead of reserving land for jobs next to Santana Row. Thank you to Rose Herrera and Sam Liccardo for voting to hold the line and retain our tax base.
In 2007, I was on a bus tour of San Jose with the General Plan Task Force. I thought the bus ride was more like the “Damage is Done Tour.” Driving past parcel after parcel of land rezoned from jobs to housing. Just when you think that we can learn from the past we turn a blind eye and continue doing the same old thing. After the vote was cast, I made a second motion that would have required that an office building be built at the same time as the housing rather than … Some Day … but that was voted down 8-3 as well.

To learn more, watch the video of the Tuesday, Dec. 7 council meeting, agenda item 10.3 — or advance by clicking to the 5th Hour 41st Minute (5:41).

Here is what I suggest if you’re interested in making money:

Step 1: Locate land designated for employment and get it under contract.
Step 2: Hire a lobbyist.
Step 3: Provide drawings of your future development that include kids with balloons.
Step 4: Divide the parcel for a … Some Day … office building on a small portion of the property.
Step 5: Require housing go first on the large portion of the property.
Step 6: Obtain affirmative vote from Council.
Step 7: Sell your entitlement to a home builder and fly to Hawaii (SJC please).

Today the Council will have a study session on Medical Marijuana. I believe the Council should implement Measure U which passed with 78.3 percent of the vote. Therefore, any medical cannabis facility should provide a third party financial audit to our Finance department and start paying a gross receipts tax.

Also posted in Medical Marijuana, zoning | Comments closed

Tax Base Erosion Night

It is that time of year again, with lobbyists circling City Hall in preparation for the General Plan hearings.

With the leadership of Mayor Reed, modifications to our General Plan (GP) have been reduced to once a year, for the most part. At the GP hearings, applicants make their case as to why current land-use designations should be changed to allow for the applicant to build what they want, regardless of how the land is currently zoned.

These “conversion” requests are typically for land that is industrial/commercial to housing. Or it could be extending the urban growth boundary to allow for more suburban sprawl. By the way, San Jose currently has over 21,000 units of housing approved and entitled on land zoned residential that has not started construction.

With more conversions of our industrial, commercial and retail land, we are pecking away the tax base a little at a time, which narrows our future options down the road.

Either you view San Jose as a dead city with little chance of economic growth (so go ahead and convert each proposal put before you because it doesn’t matter), or you have the view that there is future potential for San Jose to bring more small business and large business. I feel San Jose has not reached it’s potential but will be severely handicapped if we allow death by a thousand cuts when it comes to land use. San Jose will be fighting for a smaller piece of the economic pie in the United States as globalization continues and our national debt reels out of control. San Jose should control it’s destiny by standing firm in not changing land-use designations to housing.

At the budget hearings on Nov. 18, I shared that I would have a very difficult time asking employees for wage concessions if the Council cannot hold the line on the conversion of employment land. Seems only fair: If you are going to ask someone for money to pay your utility bill, don’t leave the furnace on all day when you’re at work. The Council has had to tell residents and employees “no” this fiscal year because of past decisions. I cannot and will not jeopardize more city jobs that provide services with conversions that hurt our future tax base.

In one of my first votes on the City Council, I voted to rezone industrial land to housing. I later wrote about my regrets regarding this vote.

One of the proposed exceptions that the Council denied in May 2008 on a 6-5 vote is back again with a different lobbyist. The same property owner also owns land where the proposed baseball stadium would be located. I met with the property owner representatives who said if the City would rezone this piece of land then they would consider selling the other piece of land to the City for baseball. I believe each rezoning should be judged on its own merits and not tied to a quid pro quo. I wrote about this property the last time it came to Council.

Exceptions to our General Plan (tax base erosion) will be heard Tuesday, Dec. 7, not before 7:15pm. I would be impressed if more than one person, whether it be city employees or San Jose residents, would speak at the Council meeting and simply say, “hold the line—please do not convert our future tax base.”

Congratulations to the Willow Glen Rams winning the CCS Division 2 Football championship over Sequoia of Redwood City. An incredible season that rallied the school and neighborhood. The star quarterback is the son of my classmate and friend from Willow Glen High. Sadly, my friend passed away from cancer several years ago however his son is the spitting image of his father, which makes it a very special victory.

Also posted in Budget, City Council, General Plan, zoning | Comments closed

A Bartender’s Vantage Point

The Public Safety, Finance And Strategic Support Committee took up the topic of unnecessary force in conjunction with drunk-in-public arrests. The police department along with the city auditor, city manager and Independent Police Auditor spent approximately 500 hours going through paper to pull out data. Inherently, a paper system is cumbersome and takes time to extrapolate data. Although we have a records management system, it is antiquated and unable to make queries that a modern system would, and it was not set up to manage certain historic data.

This issue is indicative of our city’s lack of investment in information technology.

There are many times that we ask for specific data sliced in a certain way and/or queried a particular way, yet the deliverable borders on impossible or extremely difficult. Then, if we are to get the data, the lag time is so long, it is sometimes obsolete. There is a legitimate need for upgrading information technology in our City—but there are few dollars. Staff put in a great effort but should spend their time on more pertinent public safety matters.

I never came out and accused the police of racial profiling or excessive force. Rather I walked our Downtown late at night and saw that club patrons did not mirror the San Jose population as a whole. Or put another way, the night time crowd did not match the Turkey Trot crowd. So if drunk-in-public arrests downtown did not exactly mirror the population of San Jose that made sense to me.

I was a bartender for more than ten years, as it was my second job on top of my day job. I can say, with good authority, that when people drink excessively they have poor judgement. They may get silly, argumentative and sadly belligerent to anyone around them. It did not make a difference if the person was blue collar or white collar; I would see people transform over the evening and sometimes in a negative way. Several times at the end of the night I would see that problematic individual arrested for doing something dumb, in Downtown San Jose and Los Gatos. For the record, a majority of the belligerents in Los Gatos were Caucasian, which coincidentally mirrors the Los Gatos bar scene.

Also, if you are a police officer assigned to an entertainment district, you encounter different situations than you would in a neighborhood. Therefore, you make arrests that are different from other officers. If one officer has the Almaden Valley neighborhood during the day and another has the Downtown at night, it is completely different. So calling out certain officers that have too many arrests of a certain category or arresting a certain type of person does not make sense. We have to take into consideration all other factors including demographics.

Most police officers I have met are polite, but when faced with a belligerent, intoxicated person, police need to manage the situation according to their training. Basic Rule: If you want to be treated with respect, show respect.

Good luck to the Willow Glen Rams varsity football team as they face the Sequoia High Ravens of Redwood City for the Division 2 CCS final championship game. Game time is 3pm Saturday at San Jose City College. Go Rams!

Posted in Politics | Comments closed

Decisions on Housing Types Affect Future Tax Revenue

Unfortunately, not all housing developments create the same economic value in areas assigned to the Redevelopment Authority (RDA). Last week, the council approved financing for an affordable housing development on North 4th Street in a RDA area. Since the housing developer is a non-profit, the development is exempt from paying property tax.

In addition, the fees that are paid for a market-rate development—road paving fees and park fees, to name two—are exempt from this project as well and all other projects like them. (Point of clarification, this project was entitled prior to the Council cutting the park fee requirement in half for affordable housing. I remain committed to my support of 100 percent park fees for affordable housing developers).

Locating affordable housing in an RDA area creates a lost opportunity for tax increment revenue for RDA ,since projects are exempt from property tax. As a result this type of housing does not fund ongoing city services in non-RDA areas that the new residents will require (usually at a higher rate than market-rate housing). It also shortchanges the RDA because RDA needs the tax increment from the increase in property value which then could be invested towards economic development. This housing development is a financial loss and therefore I voted no.

One way to fix this is to require that affordable housing be built by a for-profit developer so it would be subject to property tax. We would still provide affordable housing but it would help to carry its own weight in paying for city services.

At the same meeting, the Council agreed to a multi-year exemption for four north San Jose housing developments from the citywide inclusionary housing policy, which may bring in over $1 billion in private-sector spending. The current San Jose inclusionary policy has been blocked in the short term for apartments only by the Palmer court case. These developers would commit to start their housing projects by September 2011 to qualify for the exemption; however they want to make sure the exemption would not change half way through construction if the State Legislature passes a law to circumvent the Palmer case. This is an example of how an inclusionary housing policy raises the cost for the developer and inevitably increases the price for the market-rate units.

The short-term benefit would be thousands of construction jobs and city planning jobs for these 4,000 housing units that were approved as part of the Vision North San Jose plan ,where the city already has public infrastructure like roads, sewers, street lights, etc. The long-term benefit is that these housing developments are market rate and pay property tax. When the construction is complete the property is reassessed and that increase in value creates millions of dollars in tax increments to fund the RDA each year—ideally to be spent on economic development.

These market-rate developments will also provide 100 percent park fees, creating large parks since they are all high-density developments and the park fees are paid on total amount of units. More housing units per acre equals more park fees.

Tomorrow night Council will consider a new policy (I support) allowing these apartment developments to donate maintenance services for parks so there would be no cost to the City, but enabling residents to enjoy a well-maintained park. They will also pay 100 percent of the road paving fees. If a city has a RDA to create tax-increment revenues, then ideally each parcel in that RDA area should be strategic for revenue growth.

Please consider attending the Veterans Day parade in Downtown San Jose this Thursday. The ceremony is at 11am and parade is at noon. 1919 was the first Veterans Day event in Downtown San Jose and it is an opportunity to honor those who have served in our military.

Also posted in Parks, RDA | Comments closed

Annexing County Pockets

During the past few years, the City of San Jose has annexed 42 county pockets. These annexations came about in two ways. First, the State of California changed the law that made county pockets that are under 150 acres unable to vote on whether not they wanted to be annexed. Second, the County of Santa Clara had wanted San Jose to annex county pockets for years. San Jose avoided the topic until there was a court settlement with the County where the City agreed to annex a portfolio of county pockets from west to east based on the “sphere of influence”—lines that have been drawn for decades that indicate which cities county pockets would be annexed into.

By default, county pockets are different depending on their location and needs. Some county pockets have a high crime rate and gang activity while other pockets have an extremely low crime rate and no gang activity. Some county pockets do not have storm sewers, streetlights or sidewalks while others do have such infrastructure. The more affluent county pockets have higher real estate values and therefore bring in more property tax revenue to cover services while less affluent county pockets have lower property values and thus lower property tax revenues.

Last week, the city voted to annex the last under-150-acre county pocket in District 9 that is surrounded by San Jose on three sides, a combination of commercial and residential which is just down the street from the Camden Community Center. The commercial properties are along Camden Avenue and Bascom Avenue while the residential is tucked away in a neighborhood of single family homes in the $800K range. The majority of residents of this particular county pocket wanted to be annexed by Campbell instead of San Jose. They spoke at the council meeting to how they identified with Campbell and not San Jose since they liked a small-town feel and Downtown Campbell was closer then Downtown San Jose.

There was also a concern about response time for fire, so after further study it was concluded that County Fire, based on geographic location, would continue to better serve the residents. Therefore the current fee for the fire district on the homeowner’s property tax bill would continue to go to county fire so the service would not change. Due to the higher property value of the homes and the commercial land this annexation resulted in positive revenue for The City of over $230,000 per year. While prior annexations will cost the city money due to less revenues from property tax this one was positive. So going against all the speakers at the meeting the council voted to annex the pocket.

On a personal note, it was tough a tough vote for me since my childhood friend was the neighborhood association president for this county pocket and did not want San Jose annexation. It’s important for me to separate what is best for the city as a whole. If at any time I was told I could pick and choose which county pockets to annex, then I may have voted no on the pockets that were going to cost our city money.

I think if we were doing it all over again it would have been wise to annex the higher property value pockets first so we could bring in the revenue to pay for city services. Sometime in the future, and it is not known when, the City may annex the very large county pockets such as Burbank in District 6, Cambrian Plaza in District 9, two in District 7 and the massive county pockets in District 5 which would make up about a third of the entire district.

Here is the presentation on annexation that was given to the city council by the planning department.

Also posted in City Council, District 9 | Comments closed

Arbitrator: Retired Judge or Out-of-Town Labor Lawyer?

At first glance, modifying binding arbitration back in July was not my first choice over new pensions for new employees. I support the Mayor on fiscal issues, so voting in favor of Measure V and giving residents the opportunity to support this measure is consistent with my line of thinking.

In a nutshell, Measure V would put limits on outside arbitrators. During the course of the campaign I have become more and more supportive of this measure. There are two primary reasons why it is important, neither of which are getting much publicity. One, the passage of Measure V will mandate that binding arbitration for public safety unions would be held as public meetings. Public meetings that the taxpayer could attend and see how tax dollars are allocated.

As it stands today, even Councilmembers that you elect are not allowed to attend these meetings.

Second, Measure V would require that the current out-of-town labor lawyer acting as arbitrator be replaced with a retired judge. Most people share the belief that a judge is more fair than a lawyer. Not every judge is perfect, however, I would pick a retired judge instead of an out-of-town labor lawyer to make a final financial decision under binding arbitration.

I have known many of our public safety professionals for more than 30 years. They are good people who do good work. However, the status quo of pay and benefits increasing faster then revenue actually results in less police and less firefighters for residents. The City has a legal obligation to pay pensions and does not have money left over to hire more police or firefighters.

I would suggest moving forward that the critics of Measure V explain the value of how the current closed-door binding arbitration process overseen by an out-of-town labor lawyer is better than Mayor Reed’s suggestions that would control costs and let taxpayers in the room. Instead, those against Measure V are attempting to mislead the voting public by sending out materials that are incorrect and contradictory as reported in a Mercury News article on Sept. 12 and again on Oct. 22.

As a side note, it was announced at the council meeting last week that the city paid out $14.6 million in accrued sick leave to retirees in July. It is a record breaking year that beat last year’s all time record of $11.7 million. Next year the potential sick leave pay out could be as high as $21 million which is equal to this years entire city wide library budget.

Also expected property tax revenues next fiscal year will be approximately $194 million while payments for pensions will be approximately $250 million! Perhaps we all write “reform pensions to hire cops” on our check this year to the Tax Collector or better yet: Vote yes on Measures V & W.

Also posted in Budget, Measure V, Measure W, Unions | Comments closed

Worst Roads, but Great Pensions

Last week, Council dove into a study session about street paving. As you may have heard, San Jose came in last on a national survey on road conditions. This survey was done prior to the $12 million in federal stimulus money that was allocated to San Jose for road paving this summer.

San Jose’s cost to maintain roads is high due to our suburban sprawl. Total lane miles in San Jose is double that of San Francisco, which came in second for worst roads.

San Jose has 2,370 miles of road (60 feet wide) that would stretch from here to Detroit! (Could you imagine if we continued on the notion to build out Coyote Valley and increase our road network plus the sidewalks, sewers, street lights and signalized intersections?) Those 2,370 miles of road are split between 1,570 miles of neighborhood streets and 800 miles of major streets. State and federal grants for street paving (if you get them) typically only apply to the major streets and not the majority of neighborhood 25-mph streets where we live.

Staff presented us with the dilemma that as streets wear down they are more expensive to repair. For example, to “reseal” a street in good condition may cost $35K-$70K per mile, however if a street is in poor condition the price rises to $200K-$800K a mile. Complete rebuilding of a street is the most expensive at approximately $1.8 million per mile! So transportation engineers do their best to with the limited dollars to try and keep streets from falling into poor condition.

Some streets are being left behind since they are so expensive to repair. So, thus a trade off: Do we fix one mile of a terrible street or instead 10 miles of streets that are in fair condition? Well, if you live on those 10 miles of streets it is great; however those on the one mile of terrible street are left behind.

Inevitably, the decision to repair, rebuild, etc., always turns to money. The city has lowered it’s road repair budget at the same time as other department budgets were being trimmed. As the structural budget deficit took hold and the portion of the pie chart for road paving got smaller, other portions of the pie chart, such as pensions, got bigger. One proposal on how to pay for the deferred maintenance backlog (streets only) of $250 million (which may swell to $1 billion by 2020) was an annual parcel tax of approximately $300.

A comparison is that many households pay $480 a year for basic cable TV or $600 for high speed Internet, so paying $300 for streets each year would be just be considered another household expense. The other factoid cited in favor of a parcel tax was that the annual cost for car repair due to poor roads is $700 a year.

Of course this $300 parcel tax was preliminary, and other parcel taxes may arise based on different properties, or a Council decision to charge a big-box store more since their store generates many car trips. Cities alone do not have the ability to raise gas taxes so parcel taxes, sales taxes or utility taxes are the main ways to raise revenue for ongoing expenses. Gas taxes make those who drive on roads pay for them; however some of the biggest culprits for wear and tear on streets—buses, garbage vehicles and commercial delivery trucks—are exempt by state and federal law from paying a fee to cities for the damage they cause.

One of my questions at the study session was: “Since the city council policy exempts affordable housing from paying construction taxes which go towards road paving, how much money have we lost and/or could have had in the coffers for street paving from affordable housing?” Unfortunately, staff did not have the answer readily available. I am aware that the city has lost approximately $80-$90 million for our parks with a similar exemption for affordable housing developers. My back-of-the-envelope calculation is we have lost out on approximately $30 million that could have gone to road maintenance.

I think it is important that we know these things since a council policy has cost implications. If we raise your taxes for road repair but then make exemptions for something else, then maybe the tax should be called an affordable housing tax instead of tax for roads or parks.

Here is a link to the staff presentation on road repair. Click on Pavement Maintenance (Street Paving) Study Session Presentation-October 12, 2010

Also posted in Budget, City Council, Roads | Comments closed

Unexpected Support for the Plan to Sell Hayes Mansion

Last week, I got a mailer from the No on V campaign railing against the decisions of past city councils about spending on the Hayes Mansion. I was elated! I felt validated in my support for selling the Hayes Mansion to stop the annual bleeding of millions of dollars. I wrote about selling the Hayes Mansion two years ago on the Council and on this blog.

I remember sitting through many long speeches from my former colleague Forrest Williams who touted that money spent on this hotel and conference center instead of spending the money on police and libraries was appropriate. So, I wonder why are the people who support the No on V campaign endorsing Forest Williams, who was biggest proponent of the Hayes Mansion, in his supervisorial race?

I am thankful that the Hayes Mansion and its $4 million a year subsidy is being brought to light to all the voters of San Jose. However, it’s dwarfed by the $52 million taxpayers had to pay just for the pension loss last fiscal year. I can’t help but wonder where everyone was when I spoke about selling the Hayes Mansion in the past? Where was everyone when the vote was taken for taxpayer subsidized golf courses and when income-producing land was converted from industrial to housing?

It was also interesting that this mailer cited—almost as gospel—the Santa Clara County Civil Grand Jury Report titled “Money-Losing Hayes Mansion: A San Jose City Council Responsibility.” Apparently, this campaign supports the Civil Grand Jury as a trusted and reliable source. So perhaps they would then agree with other Civil Grand Jury Reports, such as: “Cities must rein in unsustainable employee costs” or “City of San Jose Hosed by IAFF Local 230 Executives” or “Los Lagos Golf Course—San Jose’s Financial Sand Trap.”

It is difficult for policy makers and interest groups to be consistent and this to me is an example of being inconsistent.

Here are the Civil Grand Jury Reports mentioned above:
Grand Jury report on Hayes Mansion.
Grand Jury report: Cities Must Rein in Unsustainable Employee Costs
Grand Jury report: City of San Jose Hosed by IAFF Local 230 Executives.
Grand Jury report: Los Lagos Golf Course—San Jose’s Financial Sand Trap.

Also posted in City Council, Hayes Mansion | Comments closed

A Public Spanking

County Assessor Larry Stone visited the San Jose City Council study session last week and gave an extensive lecture on the role of the County Assessor and a critique of Spectrum Economics. His comments were blunt, sparing only profanity about the economist hired by the RDA for $15,000. I wrote about this topic three weeks ago.

This is the only time that another elected official has spoken to the City Council at length during my tenure. Mr. Stone explained how property values rise and fall. Property values change for a variety of reasons: when property is sold, new construction, Prop 13 adjustments, Prop 8 appeals, business property (servers, factory equipment) and assessment appeals. Revenues from property tax will not increase for local governments this year and may even fall further.

Those that are hopeful of more property tax revenue have stated that if a global corporation stock price rises then so should their property value. Assessor Stone stated that there is no correlation between the stock price of a single company and how much their commercial property is worth. His example was that if you got a raise or bonus that your own home would not increase in value.

I think next year we may want to forgo an economist and instead pick up the phone and call Larry Stone. To be fair, the assessor only looks back and does not offer projections; however he has a more informed view then most and the only cost may be lunch.

Click this link to view the Spectrum Economics Report.

Click this link to view the informative presentation of Larry Stone.

Click this link for the the play by play speaking notes that went with the presentation slides.

This Wednesday night at City Hall, 6:30PM our City Auditor will present the findings of the pension audit to the public.

Also posted in City Council, Larry Stone | Comments closed

Can We Learn From the Fall of Rome?

The budget should be balanced, the Treasury should be refilled, public debt should be reduced, the arrogance of officialdom should be tempered and controlled and the assistance to foreign lands should be curtailed lest Rome become bankrupt. People must again learn to work, instead of living on public assistance. Cicero, 55 BCE

The San Jose convention center was visited by experts on the National Debt last Friday, Sept. 23. This was part of the Fiscal Solutions Tour comprised of both Democrats and Republicans, with budget expertise organized by the Concord Coalition. The speakers former titles included: the Comptroller General of the United States, head the General Accounting Office (GAO), head of the Congressional Budget Office, Public Trustee of the Social Security and Medicare program to name a few.

Unfortunately, the Power Point presentation stopped working after the first few slides, which was a shame since the slides were very informative and gave background information on the enormity of the problem we face. I showed their documentary film IOUSA at City Hall in May 2009 to show parallels with our own budget in San Jose.

The presenters shared some eye-opening items on Friday. One was that there is no Social Security trust fund. No money stashed away in a “lockbox” to pay obligations. Instead, there is a file cabinet in Virginia with a long list of IOU’s, since the government has the spent the money. This year Social Security is paying out more in benefits then it takes in.

Another revelation was that this year we will spend $202 billion just on interest on the national debt, which is more than the wars in Afghanistan and Iraq. By 2019, nearly all federal revenue will go to paying interest on the national debt and entitlement programs like Social Security, Medicare and Medicaid, leaving a sliver for military, food safety, science, etc.. Not mentioned was the sleeping giant of $3-5 trillion in unfunded pensions from local and state governments nationally.

One may hope the federal government will bail out state and local governments from their pension obligations, however, it would require borrowing even more debt from foreign countries or raising income taxes to benefit one group in society instead of other priorities Americans may have. The more the United States borrows from other countries limits our liberty, as you must be nice to your lenders (foreign governments) even if they are wrong.

Whatever level of government, hard decisions must be made or citizens will feel the consequences of punting. When asked, “How we solve this problem?” Fiscal Solutions’ David Walker said: “It depends if elected officials are willing to risk their jobs” … “elected officials don’t get re-elected by raising taxes and cutting spending. Instead they get re-elected for not raising taxes and increasing spending.” The presenters offered solutions ranging from budget reform, defense spending, health care reform and yes raising taxes strategically.

Click on this link to view an online video that briefly lays out the problem and provides their proposed solutions. http://blip.tv/file/4048954

Finally, a big thank you to the San Jose police officers who donated their time Saturday morning for the Willow Glen High School homecoming parade. Thank you Lt. Ta, Sgt. Montonye, Sgt. Moody, Sgt. Lira, Officer Ramirez and Officer Herbs.

Also posted in Budget, Fiscal Solutions Tour | Comments closed

High Speed Revenue

For the most part, I do not think people want things to change. However, could you see living without highway 280, 85, 87 or 237? When building large transportation projects there always seems to be opposition of some sort. Government at all levels—local, state and federal—deems that certain projects have a higher value in the long term.

A current public transportation project that has been receiving attention lately is High Speed Rail (HSR). Last week, the city council discussed whether the trans should run above ground or underground. The preferred choice among many in Northern California is to underground/tunnel the HSR. However, it appears that the majority of elected officials support an above-ground structure.

I have attended approximately 16 evening meetings regarding HSR. At first, the meetings were terrible with few answers and little data to answer audience questions. Over time, the quality of outreach and information has improved. It was through this process the HSR decided not to run the trains directly through the Gardner neighborhood, but rather hug highways 87 and 280.

To tunnel or not to tunnel is both a financial and timing question that includes geological reality. A tunnel from the Diridon station to the 87/280 interchange will cost an additional $800 million to $1.2 billion and may add seven years to the project. In addition, not every piece of land and what is beneath the surface lends itself to tunnel. Downtown has its challenges with sandy soil and a shallow water table. So, a piece of land in one city is different then another city, just as some parts of San Jose have streets that sink and others do not. (Wait till the Big One hits and liquefaction of soil happens in certain parts of San Jose.)

Some questions I asked at the council meeting were: “ How much does it cost to include a tunnel in the Environmental Impact Report (EIR)?” and “What more would we learn if the tunnel was included in the EIR?” The first response was “don’t know” and second response was hard to translate.

Another question I asked: “Where is the local money coming from since the City does not have any?” One response was “Well, maybe the City could make money from parking.” It sounds like we would have to find millions of dollars to build a parking garage and then promote driving your car and parking it over using public transportation—so my questions remained unanswered.

I believe our Mayor is doing a good job trying to manage an uncontrollable situation. Uncontrollable since the power in this decision does not rest with cities but rather with the state. I believe our state assembly and state senate have more power over a state agency then an individual city. We see that year after year the state takes RDA money from the cities.

It is highly unlikely there will be an underground tunnel due to cost and years and examples of issues that occurred with the “Big Dig” in Boston. Overall, I lack confidence on the HSR project since it will take $43 billion to $100 billion to build it out over time. To complete HSR will mean going back to the voters a few times for more money. I know from history that some projects take decades to complete, however you compound this on top of $500 billion in state pension liability and ask, “Where is the ability to pay?”

There is the hope to get a legal agreement with HSR that would allow San Jose to have a say in the architecture of an above-ground structure. There is good reason for HSR to agree since HSR would save money and years in construction. So if HSR would save $800 million to $1.2 billion, then they should allocate some of that money to San Jose for the architecture.

Everyone has a different view of what they like or do not like about architecture but we can agree on is that $100 million, for example, buys you some level of architecture. Since we know that the price tags on these projects grow and grow then we might want to assure a certain percentage of the build cost in that future year instead of an exact monetary figure.

On another topic, this week the council is posed to approve yet another rezoning of land to housing for an affordable housing project that does not pay property tax which has been the number one revenue for our city. How will we fund our police and libraries without property tax?

Also posted in City Council, High Speed Rail | Comments closed

The Only Economist Worth Trusting is Named ‘Hindsight’

Last Tuesday, the City Council had a study session on the upcoming Redevelopment Agency (RDA) budget. RDA funds are regulated by state law and are almost entirely spent on land and construction, similar to how bond monies are restricted. We have funded some limited city services in RDA and Strong Neighborhood Initiatives (SNI) areas (not citywide), such as anti-gang programs and code enforcement. The bulk of RDA funds have gone to capital project like the HP Pavilion, numerous museums, the convention center, parking garages, hotels, Adobe and facade grants as well as industrial projects in North San Jose and Edenvale. However, RDA also funded approximately $70 million for SNI capital projects like community centers, parks, traffic calming, etc.

The larger discussion was about how we spend or do not spend the limited RDA funds after the State of California raided the funds last year and again this year. RDA funds are based on assessed property values in the merged RDA areas (Downtown, North San Jose, Edenvale). If those commercial and residential properties increase in value, that creates more tax increment dollars. If those values decline there is less. All 350 RDA agencies statewide are experiencing the same pain. As we know, property values have declined and may decline further depending on which economist you listen to.

San Jose RDA hires an outside economist every year to forecast future revenues for a third-party review. The economist has not always been accurate. The economist has projected higher tax revenues in years past which did not pan out. Economists do not have a crystal ball and economic conditions have not been this dire since the Depression, which makes future forecasting that much harder. We may consider a different economist next year however the current economist has already been paid so I do not see the need to spend more money and hire an additional economist. I would rather take the economist’s number, cut them in half, and budget based on conservative numbers.

The main question for me is: “When revenues are uncertain, do we budget on the lower conservative numbers or the higher optimistic numbers?” I would prefer to do a budget on the lower numbers as it is easy to spend money but harder to constrain spending. The only economist I trust is “Hindsight,” and we will only know the answer in the future.

The RDA laid off 20 percent of its staff last fiscal year and may have to do more layoffs this coming year from their current 72 employees. The RDA is the only city department that is non-union, so layoffs are done by the director and not necessarily by tenure. I believe that with limited funds, the scope of RDA should be narrowed to economic development which creates a tax base and net new employment. That may also mean refraining from issuing any new debt this year and next. Mayor Reed has suggested a mid year budget review for RDA so if revenues change, adjustments can be made.

I attended the ribbon cutting for the Brocade campus on Thursday. The Mayor knocked the ball out of the park with his comments on how federal law, state law and local regulations hinder job creation. In addition, Mayor Reed pointed out a simple economic lesson—that this country will grow the economy through exporting, and Brocade is a testimony to that as the majority of its technology products are exported overseas.

The RDA spent $4 million to retain Brocade and the jobs in San Jose at a new campus at Highway 237 and North First Street. I believe strategic investments are good. We cannot always predict which company will succeed, but we know these investments reap increased revenue for the city of San Jose.

Finally, here is a table from Mayor Reed’s RDA budget message last year that shows how RDA economic development is better for city tax revenues and ongoing jobs then RDA affordable housing. The chart shows the increased property tax revenues and both direct and indirect job increase.

Do you plan your household budget on your net paycheck or on expectations of increased wages and/or return on investments?

Also posted in Chuck Reed, RDA | Comments closed

89 Houses, or 170-High-Paying Jobs?

On April 18, 2006, the City Council unanimously approved the Guadalupe Mines General Plan amendment, changing the zoning from Research & Development to Residential. At that same meeting, the Council debated other industrial conversions along Old Oakland Road/Rock Avenue, and voted to convert all of the employment-land parcels that night to housing.

Now, four years later, on Aug. 31, the Council heard a proposal for housing on the Guadalupe site for 89 single family homes. The issue for many who spoke at the meeting was that this piece of land is against a creek and the city’s Riparian Corridor policy should be adhered to. (A riparian corridor is another term for a waterway. The purpose is to make sure that developments are not built right next to a as a creek, river, etc..)

Although the internet is great for providing maps and aerial views, I prefer going out to the sites of land-use items that are on the council agenda. I drove through the existing neighborhood across the street from the proposed development to know more about it, and finally drove and walked the parcel.

The thing that struck me is that I saw many parked cars. I looked up and recognized the name on the building, Monolithic Power Systems (MPS). MPS is a $240 million analog semiconductor company whose global headquarters are in San Jose. I went into the lobby, introduced myself and asked for the Chief Financial Officer (CFO). While I was waiting, I noticed people were coming in for job interviews. I later found out they had 11 open positions they were hiring for this location on top of the 160 current employees in San Jose.
I met with Richard, the CFO, and he gave me the history of the company which started in Los Gatos and then moved to San Jose. MPS ranks as one of the fastest-growing companies in Silicon Valley. The CFO told me they like the location and would really like to stay, but they understand they do not own the property. They like the location so much they offered to buy the building—and an additional vacant building, even though they did not need it to sweeten the pot. So they put in an offer for the market price for R & D office space and a housing developer put in a bid as well, based on building houses. We know that housing trumps jobs for the cost of land. So the private property owner chose the higher bid.

The CFO understands they will have to move, so I asked what about Edenvale or North San Jose? He responded that San Jose is not on the short list, as they have looked at properties in other cities based on where executive management lives.

Understanding the rezoning was done four years ago, I could not vote for housing knowing the city of San Jose would lose a corporate headquarters and 170 really well-paid jobs. As a result, I voted ‘no,’ as I did not want to associate myself forcing a technology company to move out of San Jose. My colleague Councilmember Kalra also voted ‘no,’ citing concerns from the dais about the development being too close to the creek. Final vote was 8-2 in favor of housing.

PS: I highly recommend seeing the documentary The Tillman Story at the Camera Cinemas. It is the story of San Jose native Pat Tillman. It is a must- see and good on many levels. Do not wait for Netflix.

Also posted in City Council, Housing | Comments closed

Slowing Speeders and Implementing AB 321

Put aside the State’s raid of city funds for a moment and instead, lets be thankful for one of the best gifts cities have received from the state legislature…Assembly Bill 321 (AB321).

AB 321 allows cities the flexibility and discretion to lower speed limits on two-lane streets adjacent to public and private schools, which are currently posted at 25 miles per hour. For example, San Jose has many schools that are located in residential neighborhoods that have two lane roads with a 25mph speed. These streets may have the speeds lowered to 20mph or 15mph by implementing AB321. However,a school that is located on a four lane road would not be eligible, nor a school alongside a road that has a higher speed limit then 25 mph.

Once you determine which schools fit the basic criteria of AB321, a certified traffic study of the street is required per the state. The traffic study must be completed by a professional in the field. If a city does not have the skilled individual to conduct the study (due to rising pension costs) then the traffic studies do not get completed. (Half of the citywide traffic calming positions were eliminated in June). If a city does have the resources to do the traffic study then the study must show a lower speed then 25mph to qualify lowering the speed.

I think if the state legislature would eliminate that requirement, or lower the threshold, that would be ideal. Because the majority of drivers may drive 30mph in a certain school zone is not an excuse to condone higher speeds around schools.

I personally feel slowing down traffic around schools is a good thing to do for safety of kids but also for surrounding residents. A few weeks ago, I proposed a pilot program implementing AB321 on Dana Avenue. Due to the fire at Trace, the faculty, children and parents are walking back and forth across Dana to and from the temporary portable buildings across the street. Thus, Dana is perfect opportunity to try AB321.

Some may say that speed limits do not matter unless there is enforcement. I agree that some people do not change their behavior unless they are ticketed and fined. We can say this for any law that is broken on a daily basis in the this country. However, speeding citywide cannot be enforced today with our limited police resources.

Writing speeding tickets, I have been told by the captain of the police traffic enforcement division, does not fully fund the officers, since cities in California only receive approximately 10 percent of the revenue on moving violations—the balance goes to the state and the court system.

I am of the mindset that even without 24/7 enforcement a large portion of the driving population obeys the law by driving the speed limit or stops at intersections with stop signs and traffic signals. There will always be those that are deviant but I don’t think anyone expects government to be all knowing and stop every violation or infraction without using surveillance technology as is done in other areas. Additionally, I support using technology like photo radar since we will never have enough police to monitor 2,300 miles of road or the over 900 signalized intersections in San Jose.

We need to do all we can to try and lay out the ground rules to make our schools and surrounding neighborhoods safer. It also means that we can shame those that drive recklessly and, yes, sometimes they are parents of students during the drop off pick up time—or they might be your neighbor.

When I was a kid and missed the school bus to Hoover my Dad would drop me off unsafely on Park Avenue across the street. My dad is a swell guy but he would know better today, since we have much more education regarding drop off and pick up. There really isn’t any excuse for not following the rules when it comes to driving safely; especially in our neighborhoods.

I believe after we tackle the pension problem and over time are able to increase positions eliminated by the structural deficit, we should expand lower speed limits to school areas where applicable city-wide. Regardless of council district or geography in San Jose all schools aggregate cars and thus causes concerns for neighbors. Lower speed limits is part of the solution.

In addition, I think the lower speed limit flexibility should also be extended to neighborhood business districts like Lincoln Avenue, portions of The Alameda, Japantown, Alum Rock, etc…. Here again though, we need the state legislature to allow this flexibility. We are not asking for money just the ability to control speeding to promote commerce while being more pedestrian friendly and thus prvide a quality community experience.

Posted in Politics | Comments closed

From Last Place to First

As most of you are most likely aware from the front page article in the San Jose Mercury News on August 12, The San Jose Municipal Rose Garden was selected as America’s Best Rose Garden. What an incredible achievement! Congratulations and thanks to all involved including the paid park maintenance city staff and the non paid volunteers.

The rebirth of the Rose Garden could not have been done by only park maintenance staff or only by volunteers. It is the combination of both that allows for this fantastic achievement. And the leadership of Beverly Rose Hopper and Terry Reilly.

Just over three years ago, I walked through the Rose Garden park with numerous concerned neighbors and saw the decline and devastation. I knew then that our City did not have the resources to pay for staff to care for the park, nor would a band-aid approach allow the park to reach its potential. I also knew the City was behind the times with it’s volunteer policy. Instead, I proposed a pilot for outsourcing park maintenance. That caused the unions to assemble and defend the status quo.

Bringing up the topic of outsourcing allowed for the larger message to get out that this park and other parks need attention, especially with our structural budget deficit. Although outsourcing park maintenance, even as a pilot, was not approved in May 2007, I did push for and was successful in having council support amending the City’s volunteer policy in October 2007.

I remember asking several times then-Vice Mayor Dave Cortese to accept my friendly amendments to allow more flexibility in the volunteer policy, including a stipulation that corporations be allowed to have their employees donate time at San Jose parks on their community service days. This change allowed 250 Google employees and 150 Recology employees to volunteer in the Rose Garden this summer, for example.

The Municipal Rose Garden is a city landmark and now a national one. Volunteers include residents of San Jose and people from all of over the county. The volunteers are doers and not talkers, as they enjoy giving back to the larger community. I think they serve as an example of the JFK quote (with a twist): “Ask not what your city government can do for you, but what you can do for the community you call home.”

Municipal governments will continue to shrink as revenues will be constrained as pension costs rise. Therefore—now more then ever—residents could provide small increments of their time improving their local park, trail, traffic medians etc… Waiting on government will be taking longer then ever before.

However, residents may ask a fair question as to why cities do not do more to provide services at a lower cost. As the Wall Street Journal reported recently, San Jose will be saving approximately $4 million a year by outsourcing janitorial. The $4 million in savings was substantial enough to garner national attention and is the trend nationally.

I am very proud to live in a city where doers start with a dead vine and do not give up. As a result of the conviction from the Rose Garden volunteers, the City of San Jose Rose Garden is Number One!

Also posted in Budget, Parks, Unions | Comments closed

Police Chief Recruitment Community Meeting

I attended the first community meeting regarding the selection of the next San Jose Police Chief on Tuesday, Aug. 24 at the Roosevelt Community Center. Approximately 21 people attended. Attendees were divided into small groups to discuss five questions. I did not see any police officers however they may have been in attendance but remained anonymous.

Translation services were available in both Spanish and Vietnamese and printed material was provided in alternative languages as well. The cost for the recruiter is $26,000 to conduct the search including interviewing prospective candidates. San Jose is also paying up to $13,000 for travel expenses for all prospective candidate interviews since this is a national search. The goal is to pick a new Police Chief by the end of 2010.

In addition stakeholder outreach will be done with specific groups including La Raza, AACI (Asian Americans for Community Involvement) and PACT (People Acting in Community Together).

We have great internal candidates for Police Chief, like Captain Gary Kirby, Deputy Chief Diane Urban and Assistant Chief Chris Moore.

Here is some feedback given from all the tables that night:

What are the most important issues that you would like the new Police Chief to address?
Transparency; oversight; importance of the Independent Police Auditor; mental health issues; acknowledge good officers; more access to police records; police rotations should be longer to promote relationships between officers and residents; Gangs; racial profiling; police brutality; work with “immigrant” community.

What experience and track record should the new Police Chief have?
Experience managing a budget and under-budget; mediation skills; understands community view and police view; long history in one geography; trilingual or at least bilingual; history of promoting diverse officers; someone who changed perception of police from negative to positive; street-cop experience; manage complex organization; experience with a multi-cultural community; success in lowering crime however some thought statistics lie and this was unfair to use crime stats; track record of firing police.

Is there anything else you would like the City to consider when selecting the new Police Chief?
Should be pro-immigrant; skilled communicator; less on results more on initiatives; know the background/did their homework on issues facing San Jose; sustainable results over a period of time; at least five years of experience running large organization; speak in simple English not bureaucratic-speak; should recruit new police officers from the immigrant community; mail residents letters with the name of their local police officers and of course a sense of humor.

What are you willing to do or contribute to help the new Police Chief?
Attend more meetings; build bridges in the community; provide a report card on how new police chief is doing; pass out information; assist with outreach; be open minded.

The four groups provided feedback that essentially requires our next police chief to walk on water.

Does this feedback match your viewpoints?

There are three community meetings left:

Monday, Aug. 30, 7-9pm
San Jose City Hall Committee Rooms

Wednesday, Sept. 1, 6-8pm
West Valley Library
1243 San Tomas Aquino Rd

Thursday, Sept. 2, 6-8pm
Eastside Union High District Office
830 North Capitol Ave

You can give your feedback to these five questions via this email:info@tbcrecruiting.com

Or fill out an online Community-Police Chief survey by clicking this link.

Finally congratulations to the Mayor and RDA for locating another company in San Jose. Baxano, a medical device company, moved from Mountain View to San Jose. The CEO mentioned that one of the reasons for selecting San Jose was the proximity to our airport plus getting all of their permits in five days.

Also posted in Police | Comments closed

No Romance Without Finance

Did you ever have a romantic relationship with someone that tested you in one way or another? Maybe you or someone you know dated or are dating a person where at first the relationship was great. You were carefree and really enjoying yourself—but suddenly realized that some of your actions have consequences?

Perhaps you really enjoyed eating out at restaurants together, mostly at really nice places. And maybe your frequency of dining out increased from once a week to five nights a week. You simply put it on your credit card and did not worry about it until you had to reconcile your monthly bill. But even then maybe you justified pulling out money from savings to pay your credit card bill each month, since the other person likes you soooo much, which makes you feel really good. Maybe from time to time you get them a gift like a watch—and your significant other really likes a high-end brand. You may stop and think about purchasing a lower-priced watch, but your sweetie says “if you really loved me, you would get me the really nice watch.“

When your savings dwindle you may have had the sobering realization that your were spending more then you were making. At this point you might have a conversation with your lover about the new realities of what you could actually afford. Your ability to love may be unlimited, but your bank account is not.

It is no wonder most divorces are caused by conflicts over finances.

This analogy reminds me of what I have heard many times from union representatives: that if the council really respected/appreciated them, we would pay the them more, or continue paying them the current salary, benefits and pension.

This is a fair question if you have extra money. However, if the City only has so much, and even that pot of money is low, then you have to make choices.

I have said and have heard the same from my council colleagues that we respect the work of those employees that do great work for the City. However, words are cheap in comparison to tangibles like compensation. Just like the relationship I described above, you may want to spend more. However, you may not have the money to continue dating at the same style.

Like the City budget. If we don’t have the money we once did, we are forced to freeze or cut spending. For the individual this might be car repair, utilities and groceries. For a city that might mean cutting libraries, information technology, community centers or any other department that is important to you. It also mean that each person in a romantic relationship or an employer relationship has free will and therefore has a choice to leave the relationship.

When it comes to money, it is important that we all learn how to adapt to changes in our lifestyle and work compensation. I don’t say this lightly as nearly everyone is hurting in one way or another during this slow-growth and high-unemployment economy. I think my parents’ generation adapted best to difficult circumstances as their generation generally had a high savings rate and were green before it was cool, since they reused everything.

The Council made a hard decision last week, against a sea of union opposition, to put pension reform on the ballot for the voters to decide. These votes are tough as elected officials naturally would prefer to be liked—just like the person in the romantic relationship described above.

I am hopeful that you—the voter—will support new pensions for new employees as we simply cannot afford the current pension system. I made the recommendation that the group working on pension reform recommendations to the Council should be the former Three Year General Fund Structural Deficit Elimination Plan Stakeholder Group that the Council approved in 2008. Some of the group members are: Pat Dando (Chamber of Commerce), Bob Brownstein (South Bay Labor Council), George Beattie (police union), Randy Sekany (firefighters union), Yolanda Cruz (MEF Union) and others, including a representative from the Silicon Valley Taxpayers Association. This group recommended to the Council in 2009 to raise taxes on card rooms which the Council then put on the ballot and the voters approved.

As we move into the future and we discuss new pensions for new employees, I take into consideration that some city positions, such as police or skilled chemists at the water pollution control plant, are tougher to recruit for than others. Therefore, for competitive positions, I think future compensation should be higher on salary to attract qualified candidates.

This 80’s song by Gwen Guthrie reminds me of the relationship part of the blog. http://www.youtube.com/watch?v=XecTPWJu0wk

Posted in Politics | Comments closed

Pension Reform: Speak Now or Forever Hold Your Peace

The Rules Committee allowed my memo on Pension Reform to go before the City Council Tuesday, Aug. 3, to be considered as a ballot measure for San Jose voters this November. At the Rules Committee meeting, members of the public were few compared to the number of paid lobbyists that were in the audience.

I have a supplemental memo coming out today which will ask the Council to adopt the language below:

“To provide fiscal stability, control costs and maintain City services to residents, shall the Charter be amended to allow the Council, by ordinance and subject to the requirements of applicable law, to exclude any officer or employee hired on or after the ordinance’s effective date from any retirement plan or benefit of any plan?” (For example, this means we could exclude new employees from the 250% pension match.)

I have been a Councilmember for over three years and pensions have only increased in cost for residents of San Jose. The ability for the Council to have the flexibility and the option to negotiate a 2nd Tier would be a positive step for everyone involved, union members and taxpayers alike. Only through developing a new fair pension for new employees can we get to a point of trying to balance the structural budget deficit. However, during my three-plus years on the Council, discussions of 2nd tier always get postponed. “Kicking the can” is the easy thing to do, but San Jose can no longer pretend that our problems will go away.

Many of the union speakers at the Rules Committee last Wednesday mentioned that there needs to be dialogue, a process and time to discuss 2nd Tier. Actually my proposal does just that since changing the charter means we will still have dialogue and negotiations with the unions as obligated by law. A union lobbyist said Pension Reform would waste money since a second election would be needed once a 2nd Tier was agreed upon. Not so. As stated by the city attorney on Wednesday only one election would be needed since the 2nd Tier would then be implemented by ordinance which only requires a vote of the city council. The cost to the City to have Pension Reform on the ballot now is less expensive then a special election advocated by others.

Another union speaker was critical since my pension reform proposal did not mandate a specific 2nd Tier. This instead gives the Council flexibility in decision making as actuarial studies need to be completed as well as negotiation with our unions. Also, this allows the Council in future years to have the flexibility in adopting changes to a 3rd Tier should city revenues continue to deteriorate.

A letter submitted by a lobbyist for the union talked about needing two to four years to negotiate a 2nd Tier. This would be problematic—we should conclude negotiations within one year. Delay misses the opportunity to stop the bleeding. Another union speaker claimed the city is not hiring when that is not so. The City must hire to replace retiring employees. In fact 35 percent of the workforce is retiring in the next four years and it is important to lock in those cost savings. If we do not, each new employee carries 60 years of fiscal pension liability (30 in their career and 30 in retirement).

With all due respect, I believe the union leadership is missing the point. If we do not provide new pensions for new employees then the alternative will be to lower wages significantly and/or layoff employees. Laying off employees will affect residents. If the pension costs had not soared by $60 million this last year then we would not not be closing fire stations, libraries, postponing police academies and laying off other city workers.

The criticism I have heard from non-union people is that my proposal is not draconian enough and that the pension plans should be blown up. To them I paraphrase Voltaire: “Do not let the perfect be the enemy of the good.” Failing to act now will only lead to more obligations we cannot afford . Otherwise, do nothing and we will have more layoffs. Again, the increase in pension costs of $60 million dollars this year led to the layoff of city employees who provide services.

The ball has been teed up for the public. Speak now or forever hold your peace. Aug. 3 at 3:30pm. No need for a babysitter—City Hall is open to children. Bring a book or some knitting needles or both. If it is your first time to a Council meeting you may find you enjoy watching your city government in action.

The results of last week’s survey on November ballot measures, with 129 respondents, are viewable by clicking this link.

Also posted in Budget, City Council, Unions | Comments closed

Potential City Ballot Measures

On Tuesday, Aug. 3, the City Council will decide on five possible ballot measures that would go before San Jose voters in November. So far, the Council has budgeted money to place two items on the ballot; therefore the council must choose two of the five. However a group known as Baseball San Jose has offered to pay for the cost of putting the Downtown Baseball Stadium question on the ballot, so three ballot measure may go before voters.

Below is each proposal in alphabetical order:

Baseball Stadium
(This will be considered at the Rules Committee on Wednesday, July 28 at 2pm. The Rules Committee would need to support placing this item on the Tuesday, Aug. 3 City Council agenda.)

Ballot Language:
Shall the San Jose Downtown Ballpark and Jobs Measure be approved to authorize, but not require, the use of Redevelopment Agency funds, with no new taxes, to acquire and clear a site for a baseball stadium, fund related off-site improvements, and lease the site for a professional baseball team where the team would pay all on-site construction costs, operation and maintenance costs, generating new tax revenues for City operations?
Binding Arbitration
(This will be considered at the Rules Committee on Wednesday, July 28 at 2pm. The Rules Committee would need to support placing this item on the Tuesday, Aug. 3 City Council agenda.)

Ballot Language:
To provide fiscal stability, control costs, and help maintain the level of services being provided to residents, shall the Charter be amended to require outside arbitrators to base awards to City employees primarily on the City’s ability to pay and to prohibit creation of unfunded liabilities, increasing police and firefighters’ compensation more than the.rate granted to other bargaining units or more than the rate of increase in General Fund
revenues, and granting retroactive benefits?
Tax Medical Cannabis
(Already on the Tuesday, Aug. 3 City Council Agenda.)

Ballot Language:
In order to provide funding for essential City services such as police, fire, emergency response,street maintenance, pothole repair, parks, libraries and youth and senior programs, shall an ordinance be adopted to impose a tax at the rate of 10% of gross receipts on marijuana businesses in San Jose, subject to existing independent financial audits, with all revenue controlled by the city.
Pension Reform
http://www.sanjoseca.gov/district6/documents/7-19-2010PensionReformVoterApprovalMemo.pdf

(This will be considered at the Rules Committee on Wednesday, July 28 at 2pm. The Rules Committee would need to support placing this item on the Tuesday, Aug. 3 City Council agenda.)

My proposal is to change the city charter language so the city can offer new employees some degree of lower pension the taxpayer can afford. Current employees and retirees will continue under the current pension system and will not be affected in anyway. Pension reform includes public safety, non-public safety, city management, RDA and Councilmembers. Official ballot language will be provided by the city attorney.
Sales Tax
(Already on the Tuesday, August 3rd City Council Agenda)

Ballot Language:
In order to provide funding for essential City services such as police, fire, emergency response, street maintenance, pothole repair, parks, libraries, and youth and senior programs, shall an ordinance be adopted to enact a one-quarter percent tax on retail transactions in San Jose, subject to existing independent financial audits, with all revenue controlled by the City?
Rules committee members are:

Chuck.Reed@SanJoseCA.gov
Judy.Chirco@SanJoseCA.gov
Pete.Constant@SanJoseCA.gov
Nancy.Pyle@SanJoseCA.gov
Madison.Nguyen@SanJoseCA.gov

I think it is important that major issues should go before voters to validate Council direction or let the Council know something different.

In addition to the city of San Jose proposed ballot measures, there will be at least two other countywide ballot measures that raise approximately $14 million each. One is from VTA for $10 per vehicle annual fee for road repair. The other is a $29 parcel tax per property by the County of Santa Clara to fund children’s health insurance. Are these items what you would choose to fund with new tax revenue?

Since the City will most likely choose two of the proposed ballot measures (baseball proposal excluded) due to budgetary constraints, which do you believe are most important to be placed on the ballot if any? For me, I believe the most important two are Pension Reform and Taxing Medical Cannabis.

Here is a link to a brief survey on the November Ballot Measures that I will share later on San Jose Inside.

Also posted in Budget, City Council | Comments closed

Pension Reform Now!

My memo below will be discussed, next Wednesday, July 28 at 2pm at the Rules Committee which includes Mayor Reed, Vice-Mayor Judy Chirco, Councilmember Nancy Pyle and Councilmember Pete Constant. This is a public meeting.

Recommendation
Direct City Attorney to prepare legally binding ballot language for a ballot measure to be considered at the August 3, 2010 Council meeting for the November 2010 election allowing residents of San Jose to vote on changing the City charter by removing charter language regarding “minimum benefit” and “contributions/ cost sharing” in regards to pensions (Sections 1504 and 1505). Removing this language would allow the flexibility to negotiate a 2nd Tier pension for new employees whose hiring date is after January 1, 2011. This proposal would not change current legally vested benefits for existing employees.
Background:
Public pensions costs are soaring and forcing our City to reduce essential services to residents. In fiscal year (2009-2010) the cost of pensions was $138 million. In fiscal year 2010-2011 the amount jumped to $200 million. (The $62 million increase is double the citywide Library budget). In fiscal year 2011-2012 that number will grow to $240-250 million ( $240-250 million is approximately the annual Police budget) and could balloon to $350 million by 2015-2016 ($350 million is double the citywide Fire Department budget or more than the annual property tax and sales tax revenues)

The average private sector employer match is 3% for a 401K in the USA. In comparison, the City of San Jose as an employer matches at an 8 to 3 ratio or 250%. Individuals with retirement plans like a 401k, IRA and SEP IRA bear 100% of the investment risk. However San Jose employees do not have this risk and are guaranteed a net return of approximately 8% which means the gross return must hit 9%. The average combined return on the retirement funds for the last 10 years has only been 4.4% thus the taxpayer makes up the difference; this fiscal year alone it was $52 million. Therefore, since the taxpayers are responsible for paying the difference in pensions, I believe that residents should have the right to vote on whether or not they want to continue to pay sums such as $52 million in a single fiscal year.

It is imperative that the 2nd Tier pension be put on the 2010 ballot for the following reasons:

1). The City should give voters the opportunity to vote on the pension system. To not allow the voters the chance to vote on this issue is undemocratic. Some may say that we should just handle this “in house” and create a committee to look into alternatives and/or have closed meetings with the unions to try and negotiate an agreement. Closed door meetings would not be transparent and we do not know how many years it will take to negotiate or if a consensus of any kind can be reached by a committee or negotiations. Additionally, any recommendation that may come out of negotiations or a recommendation by a committee would need to be voted on in a citywide election anyway. We need to take advantage of the November 2010 election to know whether or not the residents of San Jose support a 2nd Tier retirement system for NEW employees. Delay will result in missing out on the numerous “Baby Boomer” retirements that will take place and be filled by new employees.

2). A 2nd Tier provides flexible options. The 2nd Tier may have a 1 to 1 match instead of 8-3 or it may have a 1 to 2 instead of 8-3 or it may be simply a new system like a 401K with a generous match from taxpayers of some reasonable percentage. Actuarial studies must be completed and presented prior to making a final decision. Retirement contributions from new employees and the city shall be put in an escrow account until a new 2nd Tier pension plan has been selected.

3). Reforming the pension system now will allow the city to balance the structural budget deficit and over time hire additional police officers, extend libraries hours and pave more roads in San Jose. If this is not addressed the rapid growth of the pensions will force our city to make additional cuts to essential city services or layoff more employees. Delay of pension reform may force our City into bankruptcy and raise taxes significantly. Even with higher taxes the new revenue is unlikely to keep pace with pension growth. This proposal maintains the benefits for retired and existing employees.

If the City Charter is not changed to allow the option for 2nd Tier system, the City will face continued severe financial duress.The current pension system is absolutely unsustainable and threatens the quality of life for San Joseans. Let the voters vote!

Also posted in Budget, Unions | Comments closed

Time to Outsource Police?

From time to time I have talked about outsourcing certain city services to save money—so the city can use the money saved on core services we provide to the community. When I first introduced a pilot program for outsourcing park maintenance at the Rose Garden Park in 2007, the council (except for Mayor Reed) shrugged off my idea. Now, the topic of how to provide services to San Jose residents with limited revenue is being discussed. For example, the city was able to open some of the pools that were due to be closed because the city outsourced to private organizations which are less costly.

The City of San Jose and other cities have declining revenues and structural deficits. Most residents now understand that not every service from a city must be done by a person earning an unsustainable pension.

Last week on San Jose Inside, an anonymous blogger using the handle “Just a Lowly Police Officer” raised the question of outsourcing police to private security guards. First, I must say what a sad choice of a handle. I am thinking he/she was attempting to be sarcastic, but who knows? How can this person expect us to respect their vocation if they do not respect it? None of the many people I know that serve as San Jose police officers are lowly. By contrast they are all good people with integrity.

Actually, I have been asked this same question about outsourcing police services in person. People have asked “why don’t you outsource the police?” My response is one of astonishment, because I think it shows a brutish lack of understanding. I ask them, “Are you serious? Do you really think that someone we recruit, background, vet, train, test and issue a gun to so they can protect and serve as a police officer is the same as a janitor? Do you really think that is the same level of qualification? The same level of risk? The same level of expertise?” The answer to these questions is simply “no.” Even the notion is ridiculous. At this point the person who asks me the question realizes they asked a foolish question and they move on.

It’s time to wake up, as we have reached a new level of fiscal austerity and there is no monetary candy falling from the sky. We have to make tough choices. So you can sit on the sidelines and whine about times of budget surplus or wake up to our current fiscal environment.

I do however support replacing desk jobs at the police station with civilians to allow more police on the street, as recommended in our city auditors report:http://www.sanjoseca.gov/auditor/AuditReports/1002/1002.pdf

I will be hosting the 4th Annual Safety Fair & Movie Night at our beautiful San Jose Municipal Rose Garden on Sept. 10 at 7pm. It will be an opportunity to show off the Rose Garden as the results will have been announced on San Jose’s ranking as America’s Best Rose Garden contest. It is also an opportunity to do something for Trace Elementary and help with raising money to fund school supplies for the 16 classrooms, library and theater that burned down.

Please consider attending and picnicking as we watch the fun family animated movie How to Train your Dragon. Voluntary contributions will accepted and there is no limit to what you can donate. Checks should be made out to Trace PTO (Parent Teacher Organization); cash donations will be accepted as well.

Posted in Politics | Comments closed

Prioritizing Services That Touch Residents

Hope your Fourth of July holiday was fantastic. On June 29, prior to the holiday the Council made the final vote for a balanced budget. More than 20 people spoke at the Council meeting and all but one advocated that the Council not outsource janitorial services but rather keep the janitorial staff employed, since they provide an incredibly valuable service. You would have thought janitorial was listed in the city charter by the speakers’ comments.

All but one of the speakers advocating for the janitors were affiliated with a labor union or religious congregation. The religious leaders ranged from Methodist to Lutheran to Jewish to Presbyterian. I understand the brotherhood and sisterhood concept of labor unions uniting to advocate for spending taxpayer money to help another union member. I also understand the calls for social justice from the clergy. However I wonder if the janitor at the church or temple makes approximately $55K a year plus a 250 percent pension match and free lifetime medical (minus co-payments) for themselves plus spouse/partner. My guess is no.

The Council was called, “shameful” and criticized for “picking on the most vulnerable.” There were undertones of racism, since the majority of janitors are not caucasian.

The notion that janitors make the least amount of money is incorrect, as I have stated for months. A recreation leader in our parks and community centers makes in salary only $38,001 and a senior recreation leader makes $54,496. A library clerk makes $50,897 in salary only while a senior janitor makes $54,787 in salary only.

So since all three of these positions come from the same pot of money and around the same dollar amount, then it is a trade-off. If the Council chose to not lay off and outsource the janitors we would have to make those same cuts elsewhere to lay off staff that work in our community centers, or lay off staff that work in our libraries.

I chose and will choose to keep services that actually touch the million-plus residents of San Jose over services that do not add value for our residents. The ability to have a community center or library open is more valuable to our residents then who cleans City Hall. The new janitorial staff will be paid like janitors at Cisco and Apple but possibly more with the city of San Jose’s living wage requirement.

A big thanks you to the Alameda Business Association and Larry Clark for another great Rose, White & Blue Parade on Sunday! Congratulations to Cleveland Ave for winning 1st prize in the parade (three years in a row) for their creative float.

Finally, as an observer early this morning it was quite a sight to see six out of 35 stations working on suppressing the fire at Trace Elementary. Thank you to our Fire Department—fortunately there were no major injuries.

Also posted in Budget, Parks, Unions | Comments closed

Final-Final

The final-final vote for the budget is tomorrow, to enact appropriations. Much work goes on behind the scenes with our budget office. Each time a change is made it is an arduous effort to balance the books and calculate the impact on the budget.

If there is a compensation cut in a private sector, it is simply a reduction off the top of base pay — that is easy to calculate. However, when we have unique requests from labor unions that require municipal code changes or legal interpretations of the city charter, it gets complicated.

Quickly, there is a ripple effect that creates work for the budget office, finance department, City Attorney, retirement department and office of employee relations.

This is why I believe labor negotiations as public meetings would be best, because information can be shared early on and we’ll know the ramifications of different options.

Part of the pain of the budget office is that our city uses 20-year-old financial software. When you are dealing with a $3 billion budget with many different types of funds and unique requests, much of the process becomes manual. This is time consuming and increases the chances of error.

Installing new financial software is no easy task and is at least a $10-15 million line item (Interestingly, $14.3 million is the projected payout this year for accrued sick leave).

When we talk about core services, we may think of sewers and streets. Nonetheless, there is the need to make things work on the back end.

Considering San Jose’s structural deficit, it will be quite a challenge to figure out how to pay for this financial system. Open source software can be looked at as an alternative, but we are talking about managing a complex multibillion dollar budget. So, I am inclined to choose a solution that has a track record.

There are so many needs in San Jose that competing for limited funds and resources has become a trading game. Some will say that public safety, for example, is so important we should spend the reserves to avoid cuts. I acknowledge this argument. I’m open to draining the reserves and then — when the State of California takes more money from cities or the tax revenues dip — we simply start laying off people with a two week notice.

However, it is not a choice I would make. Why spend all the reserves while we still fund charities with $10 million in Healthy Neighborhoods Venture Funds (HNVF)? I mean, if public safety is really so important and people are saying that “people will die” because of the budget cuts this year, why continue to do things that are discretionary with general fund dollars?

The HNVF money is not legally restricted like RDA funds or capital funds. All it takes is six votes to redirect this money.

I am not sure why city employees do not support the HNVF money, to be used for themselves and their colleagues. I think that our employees are worth keeping and worth using the HNVF money to keep them employed.

This might be another disconnect between the city employees and the larger labor union movement that supports the HNVF status quo over their own membership’s employment. We cannot be everything to everyone during tough fiscal times.

Some say we are heading into another financial storm. The Federal Reserve and the federal government still have the foot on the gas. But, the economy is sputtering. We had terrible housing numbers last week, and a weakened consumer spending outlook, thus revising GDP growth down last quarter.

Sovereign debt in Europe and Japan continues to be a worry. Japan is going to limit bond spending which seems like the lifeblood of government. The Fed is saying that they may have no rate hikes utill 2012, in an effort to spur activity as financial conditions have become more volatile as the banking sector in Europe is having issues. Cries for austerity abound regarding our huge national debt, so it is unlikely we’ll get more federal stimulus dollars. The Fed stopped buying more mortgage-backed securities last quarter.

The USA may have Japan-disease, where we have a lost decade of slow growth plus high unemployment. After the early ‘80s recession, the economy in the USA grew at 7 percent and 9 percent five quarters in a row. Last quarter, the economy grew at 2.7 percent barely, which barely kept pace with new entrants into the job market. The government sector is leveraging to the hilt, but the private sector is deleveraging even with ultra-low rates.

Most of the tools have been used by the Fed to boost the economy, and there are not many bullets if there is a double dip recession.

To read more about the “Broken State of America,” check out the cover article of Time magazine this week:
http://www.time.com/time/nation/article/0,8599,1997284,00.html

So, considering all of these macroeconomic factors, would you spend down the reserves (which is a total of 2.5 weeks of payroll) the City of San Jose has on hand? Would you personally spend your own savings down to zero if you had other alternatives?

Come out and enjoy the Rose, White and Blue Parade on July 4th. Sponsored in part by the San Jose Redevelopment Agency and The Alameda Business Association.
http://www.rosewhiteblueparade.com/index.htm

Also posted in Budget, City Attorney, Healthy N'Hood Venture Funds, Pierluigi Oliverio | Comments closed

Drama and Trauma

The two city council meetings held last week regarding the budget and labor negotiations demonstrated the need to make all labor negotiations public. If you are interested, you can click on this link and see for yourself the drama and trauma that took place that still does not have closure. This week’s meeting, June 22, will hopefully close this chapter.

I am and have been a proponent of conducting labor negotiations as a public meeting. Unfortunately, when the vote was taken last year to open up labor talks, the vote was a 9-2 against changing the process with only Councilmember Constant and I voting in favor. The process that exists is broken or to say the least, it is severely flawed. The current process of labor negotiations as private meetings hurts those it is meant to help: the employees and taxpayers.

Employees have no choice but to join their respective labor union and are dependent upon having someone else represent them at the bargaining table. It is up to those labor union representatives to inform their membership about the status and timely updates can be a challenge to a large unions. At the same time, Councilmembers are informed by the Office of Employee Relations (OER). However, councilmembers cannot really update residents of what is happening with labor negotiations and their tax dollars since these meetings are private instead of public. In addition the Council only gets one side of the story.

At both Council meetings last week, we saw the drama unfold of broken promises, innuendo, conspiracy theory, stories of personal financial hardship, co-opting of religious clergy and the reading of prepared statements. Behind the smokescreen of this drama were the real people feeling the pain and getting hurt, the employees and residents of San Jose. Both of these groups had to undergo the trauma of being tossed around in public with no one being able to share the full story. As I said at the meeting, 99 percent of city employees do a great job and are real people not faceless bureaucrats.

These city employees protect our safety, our property, our water, our young people, etc. However when you interject labor unions and secret meetings then it can lead to demonizing city employees when this is not fair. The blame should be on the current process which is maintained by both the labor unions and the city of San Jose management.

The taxpayer ultimately has the most at stake since they are the single largest group in San Jose yet they are the least powerful. The taxpayer has a right to know early on how much we have and what we can afford. Only through this dialogue can there be the opportunity for everyone to be on the same page and understand that if we as a city want more services or the same services we might have to pay more for it. On the other hand, if everyone is on the same page then structural change can be demanded so services are delivered more efficiently.

I am hopeful that the June 22 meeting is peaceful and we accomplish our duties civilly.

On a happier note, I am hosting the raising of the Rainbow flag at City Hall at 1PM, Tuesday, June 22 in celebration of the accomplishments and contributions of the Lesbian Gay Bisexual Transgender (LBGT) community in San Jose.

Also posted in Budget, City Council, Unions | Comments closed

Support Our Mayor

It is the City of San Jose’s process that City Manager Debra Figone puts forth a budget proposal in May. Then, after that is released, councilmembers make their budget proposals to Mayor Chuck Reed.

When the Councilmembers make written suggestions of their “budget wants,” they also need to include what funding source within the city will be affected (some written suggestions from councilmembers are done in collaboration with labor unions).

Then, the Mayor takes into consideration the City Manager’s budget proposal and the Councilmember’s suggestions, and comes up with a final budget. Of course, a mayor could put together their own budget without this input, but it is customary that the mayor takes other perspectives into consideration.

As a result, Mayor Reed’s budget message was released on Friday.

Every San Jose mayor must put forth a balanced budget to be voted on by the City Council. The mayor is one of 11 votes. So, just like any agenda item that comes before the Council, six votes are needed to pass or deny the item at hand.

Mayor Reed’s current budget proposal does some delicate balancing of top priorities using the limited funds we have. For some, there may be nothing to like because it is such a thin budget. However, what are the alternatives? There is no other proposal that has this level of detail, accuracy or is this candid with the challenges we face as a city.

We know both from scientific surveys done by the city and by my non-scientific web surveys that San Jose residents want to see concessions from city employees rather then cutting services.
There has been a lot of talk about 10 percent concessions.

Anything less than a 10 percent concession will result in more layoffs and therefore more service cuts to residents. Where we end up is a mystery. Still, there is little time left. What is done or not done prior to passing the current budget may implode any chance for future revenue opportunities in November.

The council may vote to drain all of the reserves and punt a portion of the problem down a short road. I do not support that option.

San Jose has some the smallest reserves when compared to other California cities. San Jose has a 3 percent reserve that only covers 2.5 weeks of payroll. Los Angeles has a 5 percent reserve, San Diego and Anaheim have a 7 percent reserve, and Long Beach has a 10 percent reserve.

I invite everyone to read Mayor Reed’s budget message if you have a stake in San Jose. It is imperative for people to understand the challenges before all of us.

Here is a link to the Mayor’s official budget message.

Here is a link to my “Budget Trade-Offs” survey which includes with over 1,000 participants.

Here is a link to my written budget proposal to the Mayor. It suggests reducing items not in the city charter and instead funding core services like police and libraries.

If people support the Mayor, I ask them to please send an email to the entire San Jose city council by clicking on this link.

The public hearing on this budget is June 14 at 7pm, and will go until late. The vote on the Mayor’s budget is June 15 at approximately 3pm.

Also posted in Budget, Chuck Reed, Debra Figone, Pierluigi Oliverio | Comments closed

2010 Budget Trade-Offs Survey Results

Hello Readers,

As you may know, I created a budget web survey which I shared with you on May 10. The survey was open to everyone and closed yesterday afternoon. More than 1,000 people participated with more than 400 written comments.

Thank you for participating.

Here is a link to the results:

2010 Budget Trade-Offs Survey Results.

Enjoy the balance of your three day weekend while being mindful of our fallen soldiers for whom this holiday was created.

Also posted in Budget | Comments closed

Walk in Their Shoes

The Good News: The City has a counter offer from seven out of 11 unions to take a temporary reduction in compensation (by paying more of their pension contribution temporarily on a pre-tax basis). The Not So Good News: The offer is equivalent to $14.6 million of the $118 million deficit, thus layoffs and service cuts are inevitable.

The “Not So Good News” reminds me of what Bob Brownstein said at the meeting I attended about the budget deficit hosted by the labor unions last month: “Layoffs are unavoidable since the deficit is so large.”

First, I want to thank those unions that made a counter offer to the Council direction. The Council directed the city manager to ask for a 5 percent ongoing pay/compensation reduction and another 5 percent in one-time reductions for a total of 10 percent. Although the offer from the unions is only a temporary reduction and is less then 10 percent, it is still an offer which should be respected.

I think it is important to look at this current situation from the union’s point of view. Unions have their own internal power structure. There is the union business agent and other hierarchy that need to satisfy their membership while at the same time managing the unions overarching goals.

The membership is divided within a union; there are those would wish to not be represented by the union but they have no choice. Other union members object to the larger policies the union hierarchy may support and these policies may have nothing to do with the workers that are represented. Beyond that, there is more division between union members that have seniority and those who are new on the job.

I think it is an extreme challenge to be a union boss at this time. You have public opinion that has plummeted in viewing labor unions more negative then positive; falling union membership in this country to approximately 12 percent (or in other words 88 percent of Americans are not in a union), government revenues declining, residents resistant to tax increases and a membership body that is divided and oftentimes upset.

With this said, I think it is a big deal that labor unions made the city of San Jose a counter offer. I believe the union leadership has taken a lot of punches internally just for making a concession.

The concessions offered (although thoughtful) are not enough and the City will still have significant layoffs and service cuts to residents of San Jose. One-time cuts push the problem out to future years as past city budgets have done. Pushing off discussions regarding new pension benefits for new employees is problematic. Also, draining reserves at a time when we see falling property valuations in Santa Clara County which will result in lower property tax revenue for cities, instability of the economy, our “pick-pocket” state legislature that constantly takes money from cities are all reasons why draining the economic uncertainty reserve now as suggested by the unions is risky.

If concessions are not easily understood by the general public, then the public may continue to distrust both unions and city government (Another reason we need to have these negotiations held as public meetings). This distrust may not allow for any potential increases in taxes that may have merit for city services. For example the city of Campbell raised their sales tax to pay for city services. San Jose may indeed look at a November ballot measure to raise taxes like Campbell.

Therefore, I would encourage discussions at the negotiation table to see where the gap can be bridged between the Council’s goal of $49 million in concessions from these seven unions and the present offer of $14.6 million in temporary savings.

On a separate and happier note, hats off to the Willow Glen High school varsity baseball team and Coach Mike Reilly with an incredible record of 27 consecutive wins.

The 2010 San Jose Budget Trade-Offs Survey closes this week.

Also posted in Budget, Unions | Comments closed

Survey: Budget Deficit Tradeoffs

This year, the San Jose City Council is forced to make drastic cuts. Unfortunately, the city of San Jose has had a deficit for the last decade even before the Great Recession. In fact, even without the recession, San Jose’s financial obligations are significantly higher then revenues coming into the city.

As a result current elected officials are left with trade offs often having to pit necessary services against each other. This year the deficit is $118 million. This is more then the entire library, transportation, planning, code enforcement, information technology, city attorney and public works departments combined.

The purpose of the survey is to gauge your thoughts about what means the most to you knowing that difficult decisions are going to be made and for you to share your thoughts on how the city can save and make money.

For example, there are alternative cost savings ideas that I support like second-tier pensions for new employees the taxpayer can afford, selling the Hayes Mansion, selling one of three golf courses, requiring affordable housing to pay property taxes, outsourcing cleaning/maintenance to save money, capping accrued sick leave payouts, to name a few. These will take longer to implement, however. If our City would have considered these items when I first discussed them, we would benefit from the cost-savings today.

This survey covers choices that must be made by June 4. The Council and all non-union personnel have taken a 10 percent pay cut and have requested that all of the 11 employee labor unions do the same so we can bypass massive layoffs—thus we would be able to provide expected services to residents. A 10 percent pay cut from all employees will help; however we would still be left with an approximate $60 million deficit.

The survey closes May 30 at noon. Survey results will be published on May 31 on SanJoseInside.com

CLICK HERE TO TAKE THE SAN JOSE CITY BUDGET SURVEY.

Also posted in Budget, City Council, Unions | Comments closed

Dear Chief Davis

I hope your weekend was enjoyable. I wanted to let you know that I believe that you have a very difficult job and I wanted to say thank you for your nearly 30 years of service to San Jose.

Managing an organization of approximately 1,400 people, public or private, is a challenge. It is impossible to make everyone happy internally or externally all of the time, or even some of the time. Overseeing a Police Department is one of the most difficult and demanding jobs one could have because of the high level of public scrutiny. As I have heard you say many times at the police academy graduations; wearing the police uniform puts the officer in the spotlight and all eyes are on the police officer. Our police are judged by everything from their words to the tone of their voice to body language.

With the retirement of Assistant Chief Katz there is a void in the police department leadership ranks. SJPD has the privilege of having many skilled men and women through the ranks who work hard and are committed to the safety of our residents. These dedicated police officers can and will rise to the level of leadership as needed. This is the benefit of having high standards of recruitment and vetting during the police academy and field training program. These high standards are a result of the investment of approximately $129,000 made by the city of San Jose into each new officer’s training and thus we risk a loss of approximately $10 million with the layoff of 80 of our most recently hired police officers.

As you know I have been on the Council for three years and in that time there has been challenging public discourse around SJPD. Each time SJPD needed an articulate speaker, for example on police records, or a technical speaker on the Bobby Burroughs police sub-station, and one person’s performance stands out. Again and again, whether at a council meeting, committee meeting, community or special meeting, I remember one person in particular always being there by your side or by himself defending, explaining and promoting the SJPD. This person was always on target and therefore respected by many officers from all backgrounds.

That was and is Capt. Gary Kirby. Time and time again Capt. Kirby rises to the occasion. Chief Davis, I believe you have a unique opportunity to promote from within a respected member of the SJPD. From my perspective Capt. Kirby is just missing the title of “Assistant Chief” since he already performs by your side and has lived up to the term, “got your back,” but the “back” to me refers to the entire police department.

Thank you for your consideration Chief Davis. Stay Safe.

Also posted in Police, Rob Davis | Comments closed

The Center of our City Center

Last week I attended evening budget meetings in Districts 3 and 5. The center of our city (District 3) had a high turnout from residents who find great value in community centers. Particularly, the Gardner and Washington Community Centers. Both facilities provide a place to go and where residents can be positively impacted. Classmates and friends of mine from Willow Glen High grew up in the Gardner area, formerly known as “Barrio Horseshoe.” It was a problematic neighborhood with many gang issues.

My friends in Gardner managed to stay out of the gangs because their parents would physically discipline them if they hung out with people involved in gangs, and kept them busy with chores and work. David Pandori and Cindy Chavez both worked hard to make improvements in the Gardner neighborhood and should be complimented for turning that neighborhood around with the help of passionate residents like Rudy Martinez. Also, praise to my colleague Sam Liccardo for continuing the Pandori/Chavez legacy in Gardner.

The other facility is the Washington Youth Center located in the neighborhood around Washington Elementary and Sacred Heart church. This is another area that has been dealing with gangs for decades. The Redevelopment Agency funded the construction of the Washington Youth Center and the adjacent library along with physical improvements to Washington Elementary. However the general fund is responsible for the day-to-day expenses. Many came to tell their stories of what these facilities meant to them. Some stories brought people to tears as they had family tragedies but also success stories of their children.

Some attendees came from other cities to advocate for our Therapeutic Services program that enables kids in wheelchairs to participate in sports like basketball. They come from other cities like Cupertino and Monterey since surrounding cities stopped offering these services.

There were those who asked, “Why did we ignore the structural deficit all these years?”

Many expressed their opinion that public safety unions should accept wage cuts to save city services and binding arbitration was unfair. Pastor Sonny Lara asked, “Why are people so generous with money for tragedies in other countries but we do not donate to our own local community?” My favorite quote of the night: “We need to stop electing politicians that promise us everything!”

If there was one theme in the District 3 budget meeting it was to keep community centers open. It was stressed by many that community centers and libraries save lives in certain neighborhoods and that these facilities act differently than in Almaden, Cambrian, Evergreen, Rose Garden and Willow Glen. Many felt that community centers and libraries should be open more hours in neighborhoods that have higher needs, which could be determined by crime rate, poverty rate, etc..

I was asked afterwards by several young people who were good role models if would I support their specific community centers over others. I said, “The easy answer is to tell you yes and then walk out the door and vote no.” However, I continued, “the idea of, should some neighborhoods get more services then other neighborhoods is worth debate.” I then asked the youth if they cared who cleans City Hall or would prefer that their community center stay open. They chose the community center.

I believe we should maximize cost savings in areas of our city that do not directly touch residents before cutting services that impact residents. Otherwise we are saying, “Sorry young people, the status quo on cleaning city hall is sacred and better then providing you services that would directly impact your future.” If you do not like this trade off of cleaning staff versus community center employee, then how about community center employee versus librarian or community center employee versus a police officer? Take your pick. Side note: Laying off new police officers is a double loss since we lose the investment/cost to recruit, test, background, academy, field train the new officer.

But let’s get back to the debate on providing more services to certain neighborhoods and less to other neighborhoods. I would acknowledge that higher needs exist in certain neighborhoods and that prevention is less costly than the worst-case scenario of incarceration. There is a disconnect between costs and responsibilities of the city and final costs that may end up on the County or State, but there is also limited sharing of revenue to achieve these goals. On the other hand, I do not believe every person in a certain neighborhood or zip code is affluent.

Within each neighborhood perceived to be upper-middle income, there are those who rent, have a mortgage they are struggling to pay, long- term unemployed, a single mom with kids, seniors on a fixed income, disabled veterans, etc. I assume these residents and specifically youth would want to have the opportunity to read a book or partake in an activity at a community center.

In addition these perceived upper-middle income neighborhoods pay higher property taxes and may feel that they should at least have equal neighborhood services. Personally, I think each neighborhood should get equal infrastructure like sewers, streets, sidewalks and streetlights. Equity in parks is more difficult because of the build-out of nearly all open space and the cost to procure it at today’s prices. (Such a tragedy that we lost out on approximately $90 million in park fees from exempting affordable housing from this fee.) When it comes to what amount of neighborhood services for each zip code, I am open for debate and would like to hear your views.

Is it fair to provide more service to specific neighborhoods? Is that Marxist? “Each according to his abilities to each according to his needs. Should government be neutral and provide exactly the same to all areas?

When people buy a more expensive home does that mean something? People choose to buy or rent in areas based on surrounding amenities and pay a price determined by other property owners and renters. Do we let that be the barometer?

Also posted in Budget, Parks, RDA, Unions | Comments closed

Mirror, Mirror on the Wall

Last Wednesday night, the Public Safety committee held a special meeting regarding our police officers. The city manager began by sharing the amount of effort and outreach that has transpired the last few months with city initiatives with regards to our police department.

For the last two years, certain individuals have been lambasting our police force with charges of racial profiling and excessive force. Our police force has more than 400,000 engagements a year with San Jose residents and 99.8 percent of those have no complaints. The City of San Jose has an internal affairs department and an Independent Police Auditor (IPA) for complaints about the police department. With a city as large as ours, we are aware that complaints will no doubtfully happen. However, the complaints are few and far between, and that is something the city can be proud of.

Over the last two years I did not rush to judgment on condemning our police but rather listened to all points to view. As a Councilmember in a representative democracy I represent my entire district population and not just those who attend meetings as 99.5 percent of residents are not able to attend meetings or more so do not want to attend meetings.

Several members of the public spoke before the council and were generally supportive of the police. The speakers were San Jose residents from the West Side and the East Side who appreciated the efforts of our police force. One theme of change however was lengthening the rotation of a police officer from six months to some time longer so as to build even better relationships with residents.

The length of rotations is an issue that cannot be changed with a snap of the finger but rather a negotiation with the police union. I look forward to hearing more about the pros and cons on this specific matter.

Daniel Pham’s father spoke emotionally about his deceased son who suffered from mental illness and his loss. Dealing with the mentally ill even with specific training is very difficult as it is hard to reason with a delusional mind in a stressful situation. My friend from elementary school who suffered from mental illness committed suicide last year thus I have some understanding of the challenges with mental illness.

Another interesting point was raised by two different speakers. One was a Christian biker who was dressed sort of like a Hells Angel. He mentioned that his group had been stopped time to time by the police. He said if he was a police officer he would stop the bikers as well. He pointed out, however, that you should speak to a police officer the way you would like to be spoken to, like the Golden Rule.

As someone who grew up in San Jose I was always taught by immigrant parents to be polite to the police and I have been. It is only since being a Councilmember that I heard a person can verbally throw profanities at a police officer and that is acceptable. Well, it would not be acceptable with my Mom and Dad. An African American speaker who himself pointed out his large Afro said that he has been stopped by the police for decades both on the East Coast and the West Coast based on his appearance.

These two speakers got me thinking that is not just police stopping individuals but also the residents who call the police. Police respond to calls from our residents about suspicious activities and people. Therefore really all of San Jose is responsible. So, when you hear those that are critical of the police they are also critical at the character and prejudgements of our own San Jose residents and need to look in the mirror.

As far as our new IPA, I voted no along with Mayor Reed and Councilmember Constant. We had four well qualified candidates to choose from and I preferred another candidate. I do wish our new IPA great success for the 2.5 year term and beyond.

It is with deep sorrow that Chief Katz will be leaving/retiring from our police force. A straight shooter and a gentleman, he will be missed. My only request is that Captain Kirby please stay for the sake of stability and morale. I would make the same pitch to Chief Katz but I think it is too late.

Also posted in Police | Comments closed

A Dollar Borrowed is a Dollar Earned

Last week, I attended budget meetings in council districts 9 and 10 as well as the labor unions’ budget meeting at the Tully library. The people that attended this meeting were mostly union members and city council staff. It was admitted at the meeting that significant layoffs were inevitable since the deficit is enormous.

Ideas were presented on what money-saving measures could be implemented and what new sources of revenue could be found to balance the $118 million budget gap. Ideas ranged from replacing natural lawns in parks with artificial turf (lower ongoing maintenance costs, but more costly upfront) to turning down the air conditioning at city hall during the summer. Others included putting banner ads on the city website for advertising revenue and charging owners of vacant property a fee/fine since they do not have a tenant.

Although many “creative” ideas were mentioned, none of them seemed to really tackle or help offset our deficit of $118 million—nor did the suggestions even get close to $1 million. Other thoughts were a “crash tax.” For example, if you were to get into a car accident and police or fire truck showed up, then you would pay $500 to $2,000, since you used city services. Another idea would have the city attorney sue code enforcement violators for fines owed rather then placing liens on their property as we do today.

There was a proposal advocating outsourcing. Really?! This concept would outsource the workers compensation program to a third party since it would be cheaper and faster then if the city continues to run it. Interesting that it makes sense for this program but not outsourcing city hall janitorial to keep swimming pools open!?

The major theme at the meetings, however, was about borrowing more money. There was a discussion advocating pension obligation bonds (POBs), which is an arbitrage scheme where the city borrows tens of millions of dollars in the bond market, and then we give that money to the city retirement funds, hoping the retirement board investment strategy earns more money than the city pays for its bonds. If the retirement fund does make more money than we owe the bond holders (and the associated investment fees), then the city can spend the difference. However if the investment return is lower than the city’s cost, then city loses even more money. Similar to a cash advance on a credit card and then investing the cash advance amount in the stock market and hoping that the stock will have a higher return then the credit card interest rate. Also, by issuing POB’s the pension obligation, which can vary over time due to investment returns, becomes a hard liability in the sense that debt service is fixed for 30 plus years.

Probably, the «best» idea, was to borrow money by taking out tens of millions of dollars in one-year notes/commercial paper to pay for ongoing city services. Then, when these notes come do in 2011, we would issue more notes to cover the original 2010 notes. When the 2011 notes come do in 2012, we would issue more notes again for 2013 and so on or until city tax revenue came back.

First, the revenues will not come back to pay for existing city services since pension obligations as a percentage of the general fund will continue to grow faster than revenue coming into city coffers. Second, this bright idea is like a consumer who charges up one credit card and then gets another credit card to pay off the previous one and so on. Issuing commercial paper to cover ongoing operations would hurt our bond rating and banks that provide San Jose with Letters of Credit will look at the city as irresponsible. I cannot recommend this type of borrowing/financing for city services as it passes on the problem to another eneration. We are partly suffering now because of the lack of tough decisions by previous elected officials at all levels of government.

“We should avoid ungenerously throwing upon posterity the burdens that we ourselves ought to bear.»—George Washington

Also posted in Budget, City Council, Unions | Comments closed

Different Viewpoints on Medical Cannabis

Last week, the Council finally discussed my memo and voted to have staff come back with a draft ordinance for final review regarding medical cannabis. Currently, 14 states have legalized cannabis for medical purposes and 14 other states are considering legislation now. I attached a memo from the US attorney general saying that the federal government will recognize state laws regarding legalization of medical cannabis and additionally, I provided an 11-page document from State Attorney General Jerry Brown that provides guidelines to municipalities on implementing ordinances that regulate medical cannabis collectives/cooperatives.

Even if San Jose chose not to adopt an ordinance, people have the legal right to cultivate and form marijuana collectives for medical purposes under Prop 215 today.

Since my memo was heard at the Rules Committee meeting last October, I have spoken with many San Jose residents. Their comments have commonalities that could be broken into four different areas.

One viewpoint from a handful of residents is that cannabis is a terrible drug that ruins people’s lives, and all efforts should be into keeping it illegal even for those that have painful afflictions like AIDS, cancer and MS. Some felt that under no circumstances should anyone use cannabis to numb the pain since we have prescription drugs for that. Their views are strong and are often not open to discussion, as in the case of a gentleman who held this view who hung up when I called him after receiving his email.

I understand that people may have experienced a friend or family member that abused illegal drugs or they are morally opposed to their use; however they do not seem to have a problem with alcohol or tobacco since they are legal. These folks also did not find a problem with prescription drugs. In the cases of alcohol, tobacco and prescription drugs we know that some people abuse them and this abuse comes at great cost to themselves, family and law enforcement.

Others called with personal stories of family or friends who had died of a painful disease years ago. They were told by a doctor at that time to get some marijuana and so they went out and purchased marijuana from a drug dealer for their ill family member. One 80-year-old resident told me that his family bought marijuana for his brother 25 years ago. He said the last 10 months of his brother’s life was good because of cannabis and his brother only went to the hospital just a few hours before he finally died of cancer.

Another group of residents were supportive of medical cannabis or indifferent but they did not want to see these facilities adjacent to residential areas and felt that there should be some regulation in addition to zoning. My direction in my memo was to place the dispensaries in industrial areas which are away from residential neighborhoods, but Council gave planning staff some leeway for the June ordinance that might include medical offices or areas zoned commercial, but definitely away from adjacent residential. Alcohol is distributed in nearly 1,300 places in San Jose and over time seem to just blend in with the rest of our commercial business.

As far as regulation, one that I am keen on is open book accounting of these collectives that allows for financial audits as needed.

Others were in favor of legalization of cannabis for any purpose. They felt that our country had tried prohibition of alcohol from 1920-1933 and was unsuccessful. The only thing prohibition did from their view was to make organized crime wealthy and create health issues with moonshine. They had strong feelings that people will do as they wish and the wars on drugs has been unsuccessful which has only filled the pockets of organized crime. Therefore, they wanted legalization and taxation like alcohol.

They felt prison cells should be reserved for the those committing violent crimes and not possession of marijuana. A mother told me about her 20-year-old son in college, and said that it is easier for him to get marijuana then it is alcohol, since alcohol is regulated.

Which ever viewpoint, issues like this stir up interest in local government. Which viewpoint do you hold?

Also posted in City Council, Medical Marijuana | Comments closed

3%—100%? 250%!

Monday: No Impact Man Film at City Hall
Nearly 300 San Jose residents attended to watch this documentary, which portrays a family that adopts environmentally friendly choices over the course of a year. For example, they bike instead of driving, buy only locally produced food and give up their television. The main point of the evening was that we do not have to wait for government to mandate behaviors that help the environment but that collectively we as residents can choose to compost, use less electricity, bike vs. drive today, etc…
A reporter from the San Francisco Examiner attended and wrote about the event. Read the report here.

Tuesday: City Council Meeting
Council waived the business license fee for the first 1,000 business under 35 employees retroactive to Jan 1,2010. Some on the Council commented that it was symbolic and would not create jobs. The Council does not create jobs; private individuals do. If the Council wants to do something symbolic lets get rid of the Labor Peace regulation and allow Starbucks to open at city hall as planned. Nearly five years and still empty.

During public comment on the Mayor’s Budget message, a lobbyist from the union chided the Council for even thinking about 2nd Tier benefits that the taxpayer can afford since it would be unfair to have people working side by side who have different retirement benefits. The next non lobbyist speaker stated that people in private sector are compensated differently from each other today and they survive. The current pension system is unsustainable and must be changed for new employees.

A couple of SJI readers asked last week how retirement works under the city charter. Here is the response to that question:
Each employee puts $3 and the city puts an additional $8 into the retirement fund. On top of the over 200 percent match, the city guarantees an 8 percent net rate of return, but the fund needs to gross 9 percent to cover investment fees. (Average rate of return the last 10 years is 4.4 percent) If the retirement portfolio (stocks, bonds, real estate,etc.) does not return 8-9 percent, then the taxpayer covers the difference.

Any changes to the current system requires a vote of San Jose residents. As we hopefully implement 2nd tier benefits I would suggest an option for new employees of a one-to-one dollar match up to the federal 401K limit of $16,500 and no guaranteed 8 percent return. This way the retirement funds will continue to get funded by new employees much like social security is funded by younger workers. The newer employees will draw less benefits but then we will not have to close more libraries or layoff more police in future years.

A dollar-for-dollar match (100 percent) is extremely generous in comparison to the average 3 percent match of private employers to 401K’s. If there are specific positions in our city that are tough to recruit then raise the entry level salary since young workers want more money up front to buy a home or fancy car. Same time if there are positions with many qualified applicants then those entry level salaries should be frozen indefinitely or lowered.
Wednesday: Grand Boulevard Committee, Member
Attended meeting at SamTrans in San Carlos. The purpose of this committee is to provide a venue for cities and transit agencies from South San Francisco to San Jose to plan transit-oriented developments all the way up and down the El Camino Real. The thought is through density, the El Camino will gain the improvements to add large sidewalks and pedestrian friendly accoutrement’s the entire way creating a Grand Boulevard.
Thursday: Public Safety Committee, Member
The committee received a verbal report from staff on why hiring retired San Jose Police Department (SJPD) officers is problematic. Staff response seems odd. We have many qualified retired SJPD in our area that it seems silly not to hire them to do background checks for new recruits instead of pulling police officers off patrol to do this work. But then again we have postponed the police academy indefinitely yet we fund a community center in Los Gatos for $80K out the $11 million in tobacco funds that goes towards charities.
Friday: Diridon Joint Policy Advisory Board, Member
First meeting of the Diridon Joint Policy Advisory Board whose goal is to create a Grand Central Station of the West by collaborating with state, federal, transit districts, adjacent residents and business owners over the next 10-20 years. We elected Mayor Reed as the Chair.

Click this link and vote for ultra-high broadband networks from Google for San Jose.

Also posted in Budget, City Council | Comments closed

What Would Cesar Chavez Do?

Below are a few observations from last week.

Monday: Council study session on Airport
Overwhelming majority of Council thought outsourcing of janitorial to save $3 million was a bad idea so it looks like we will lay people off and consider getting rid of the night time curfew in the future.

Monday Night: General Plan 2040 Task Force Meeting
Although the General Plan board members were informed that the City’s budget problems are partially due to most of our land being dedicated to housing instead of jobs, the Task Force voted in favor of adding 300,000 people with a 14-11 vote. The two options were 200,000 or 300,000 new residents. Several task force members shared that they voted no because they wanted to see higher growth of 500,000 more residents to San Jose! I voted for the option that added 200,000 people by 2040.

Tuesday: Council Meeting
After 18 months of staff and paid consultant “research” regarding my Sept. 18, 2008 memo proposing that developers of affordable housing projects be required to pay park fees, as market-rate developers are required to, the question finally came to Council. I believe that people of lower income are deserving of 100 percent park fees/land dedicated, the Council decided to support the Housing Department’s compromise that developers pay only 50 percent. To date, the City of San Jose has lost approximately $90 million in park fees from developers because of this park exemption.

Are you familiar with the term, “What Would Jesus Do?” Well I wonder as we come up on Caesar Chavez Day, “What would Caesar Chavez do” if he was alive and on the Council. Considering that affordable housing provides for people of lower incomes and is often located in areas that do not have parks, would he vote for equity when it comes to parks in San Jose for all people?

The next agenda item on the council agenda that day was the Habitat Conservation Plan where it seemed that the Council had more sympathy for the checker spot butterfly then parks for people of all income levels.

Wednesday: Visit Medicinal Marijuana Collective in Oakland
One collective is on target to write a check to Oakland for $360,000 in city taxes and another check to the State of California for nearly $2 million in sales tax of which approximately $200,000 will come back to Oakland; therefore Oakland will be receiving approximately a half a million dollars from one legal medical collective that employs 80 people with an average hourly pay of $43.

Thursday Night: Neighborhood Association Meeting
I talked about the budget and announced to the audience that the City would be suspending the $750K aquatics program for the 2010-2011 city-wide. I shared that the City could restore the entire program if we chose different ways to do city services, like outsourcing janitorial services at City Hall for example. There were many in the audience that felt that they did not care who cleaned city hall but they would rather have a summer aquatics program for youth or a library open.

Friday Morning: American Leadership Forum-panel discussion titled, “A new recipe for regional job growth.”
Panel discussion of private sector and labor spoke to how the region can create jobs going forward. A business person asked the labor panelist, “What if public employees would take less in pensions to help balance the budget and avoid layoffs? Response from labor panelist was that, “Most of the deficit in San Jose is not pensions but debt service on City Hall.”

Actually, the debt service on City Hall is $24 million of which $17.1 million is from the general fund out of a $116.2 million general fund deficit. $52.9 million is the amount the general fund must cover this year in increased pension contributions since the taxpayer must cover any losses in the pension funds. The $52.9 million to cover pension losses is only a portion of the total amount devoted to pensions this year which is $200.2 million.
Looking back in history on 5/14/02 the only votes against new city hall was Linda LeZotte and Chuck Reed.

Also posted in Budget, Parks | Comments closed

Keep the Airport Curfew

This afternoon at 1:30 the Council will gather for a special meeting to discuss the City’s airport. The expansion was voted favorably by the council in 1997 with then-Councilmember David Pandori casting the only vote against. The airport, with the hands artwork that is visible driving on Highway 87, was approved in 2005. Through the selling of bonds (borrowing) the city of San Jose has spent $1.3 billion on the renovation.

Since 2007, the airport has experienced a 25 percent decline in the number of passengers and 33 percent reduction in number of flights. The airport competes with San Francisco and Oakland airports and is one of the few city assets that competes with other cities. Airports and airlines have been impacted negatively from terrorist threats, web meeting solutions. spiking fuel costs that pushed companies to adopt new web meeting technologies faster and of course the Great Recession.

Take all of these factors listed above into consideration and then add on government “feel good” measures like the new city of San Jose living wage policy that was passed by the council last year (I was the only no vote) that requires private companies at the airport to pay private sector workers above-market wages. It may “feel good” for politicos but it raises costs to the airlines and to the taxpayer as the city now has a city employee who makes $156,000 to oversee the living wage policy just at the airport.

In fact, we have a total of 11 full time people ($1,414,941) at City Hall who oversee that private sector workers are paid a certain wage. Personally, I would rather have 11 code inspectors or 11 planning dept staff. Another “feel good” measure is that the airport must spend $3 million extra every year on janitorial services because of another council policy that does not allow outsourcing, which again raises the costs to the airlines. (Well, technically we “allow” outsourcing but it takes nearly two years and multiple highly charged City Council votes that require at least six votes…so essentially NO). As Marvin Gaye said, “Mercy Mercy Me.”

If you put yourself in the airlines’ shoes and you know that the Bay Area has three airports and that residents will drive the short distance to fly, then you might be more likely to choose the airport where you can maintain a higher margin of profit that has the lowest cost. If you choose to not maximize your profit then consumers, mutual funds and even retirements funds may sell your airline stock and eventually you may get fired.

Some suggest that eliminating the curfew would solve the airport’s financial dilemmas. It is a big unknown that if eliminating the curfew would be the salvation of our airport. Will flights at 3am generate more revenue then the $12 million of savings that outsourcing would deliver at the airport as outlined by the airport director? I don’t think so.

What I do know is that approximately 100,000 people hear the airport flights today and they would prefer not to be awakened in the middle of the night. Now there are some areas of San Jose that do not hear the airplanes during the day, but I think that residents of Almaden Valley and Evergreen might start to hear the planes if they are arriving and departing at 1am, 2am, 3am, etc. The economic value of getting rid of the curfew is unknown however we do know the Council has the power to allow the airport to start saving money today without upsetting many residents.

My viewpoint is we need to have a successful airport and by that I mean a successful daytime airport that operates up to what the Environmental Impact Report (EIR) allows. The airport should be allowed to run itself like a private business, competing with San Francisco and Oakland without all of the city policies, while maintaining its successful curfew as other cities do so in the USA.

On another note: Tonight the General Plan 2040 Task Force will choose a scenario to recommend to the Council for San Jose’s growth by the year 2040.
Here is a link to a General Plan 2040 Task Force web survey prepared to solicit feedback.

Also posted in Airport | Comments closed

Why Free Parking is a Bad Idea

Professor Donald Shoup of UCLA visited City Hall last week. He was in San Jose to present a lecture titled, “Why free parking is a bad idea.” The information he shared is based on his book and research.

There are approximately 700 million parking spaces for 230 million cars in this country and 99 percent of cars trips have free parking. Prof. Shoup showed an aerial picture of the Cisco Systems campus with its empty asphalt parking lots. He felt that these empty parking lots are not a good use of land and that it creates higher-than-needed vehicle miles traveled (VMT). He then continued to share what he thought would be a way to better utilize the land, which was to allow Cisco to build housing on their parking lots and waive all parking requirements. He felt this would provide housing close to jobs, reduce VMT and bring a more appealing look to the current parking lots.

Another point that Prof. Shoup spoke to was metered street parking. He told the story of Old Town Pasadena and how it was dilapidated. The city of Pasadena started meter parking and put all of the metered parking money collected back into improvements of Old Town. At first there was opposition to metered parking but when people heard that the money would stay local and be earmarked directly to Old Town improvements the community supported the metered parking concept and asked that the City to keep the meters on till midnight and even on Sundays! Over time Old Town Pasadena’s private property owners improved their buildings since the city was investing into those blocks that had metered parking. It has now become a very successful business district and generates more sales tax then other business districts that have free parking.

His main points are that street parking should be priced to where 85 percent of the spots are occupied but there is still some empty spaces. This allows someone to park quickly on the street but at a higher price for the convenience. The alternative today is we have inexpensive on street parking where people circle the block (cruising) countless times (unnecessary VMT) to try a find that one inexpensive magical parking spot. He felt the money generated from the parking meters should be spent in those blocks doing sidewalk repair, tree maintenance, pedestrian lighting, under-grounding utility lines, sidewalk cleaning, landscaping etc…

I asked the question, “What about parking meter districts that border residential neighborhoods?” He felt permit parking was one way to make sure cars did not overtake residential areas however that the neighborhood should allow employees to buy a parking permit pass so they could park on residential blocks. His reasoning is that there is ample open parking especially during the day when residents commute to work. The employees would pay a higher price then the residents and the employee would only be able to park on a certain block. All of those funds collected would then be spent on those blocks and spent on things the residents want. His idea was to let specific blocks choose if they want to allow employee permit parking and receive the benefits.

Since councilmembers typically hear “there is not enough parking” as the main complaint about any development, whether it be residential or commercial, I asked the following question: “What about new developments that want to have lower parking ratios?” He felt that the creation of permit parking areas around adjacent streets was good but more importantly he said the less cars allowed to park at the new development the better because it creates less traffic.

What do you think?

Are these pie-in-the-sky academic theories, or should San Jose curb parking and allow for a different lifestyle choices to emerge?

Finally I hope you will join me for the showing of the film, No Impact Man. The documentary follows a family that tries to live a zero-carbon footprint for a year; no water bottles, no soda cans, no magazines, no TV, no car. Think you could do it?

When: Monday March 15 at 6:30pm
Where: City Hall Council Chambers
Limited seating please RSVP to Pierluigi.Oliverio@SanJoseCA.gov

http://www.youtube.com/watch?v=1fITT6rVPds ” title=“Here is a YouTube link to the trailer.”>Here is a YouTube link to the trailer.

Also posted in Parking | Comments closed

When Times Get Tough Just Borrow More Money

Mayor Reed shared a candid and honest view of city revenues and expenses at the State of the City Breakfast last week. (Personally, I miss the State of the City speeches in the evening as it led to dinner after the speech and spending money Downtown.)

As we already know the City is walking the plank, with the sharks swimming below in the ocean (sharks = bankruptcy) and a sword wielding pirate (pirate = hard choices) is forcing us to walk down the plank off the ship. Walking back up the plank in not an option unless tough decisions are made now. However it seems that another alternative being heard more and more at city hall is borrowing.

This week the council will vote on an RDA budget that proposes to borrow $10 million from the Park Trust Fund, Ice Center and Water Pollution Control Plant to be repaid in approximately six years. Six years of risk. What if there is a major repair needed at the Water Pollution Control Plant or the Ice Center?

Six years of not being able to make a strategic purchase of property for a park or trail connection. The Park Trust Fund comes from fees paid by housing developers who build market rate housing (affordable housing is exempt from paying park fees). In turn, they want to see their money spent on what it was intended…parks! Actually if we do not spend Park Trust Fund money within a certain amount of time the city must return the money.

The Library Parcel Tax reserves were considered for borrowing but spared since it would kill the chance of getting the voters to continue the tax in 2012. (A point I brought up at the Neighborhood Services Committee.) The alternative to borrowing this $10 million would be to borrow this amount from the Housing Department as allowed by the State Legislature, which I support.

Borrowing of these funds today limits the city’s options tomorrow when the state will grab more money from the city. If we are forced to borrow then let’s do it to maintain core services like police and libraries, not more affordable housing, most of which does not pay property tax.

The City will also be issuing $25 million in commercial paper to pay a portion of the State’s raid of San Jose RDA. Commercial paper is the equivalent of a home equity line that must be paid back. The collateral for the $25 million in commercial paper is our beautiful California Theater, home of San Jose Opera and Symphony Silicon Valley. Again the other option would be to borrow this money from the Housing Department instead of borrowing more on our equity line. Borrowing in both cases is due to the State Legislature taking $75 million away from San Jose RDA funds.

At the budget study session last week a union lobbyist touted the idea of risky pension obligation bonds. Pension Obligation Bonds (more borrowing) are used to fund the unfunded liability of pensions, so as to lessen the large amounts coming out of the general fund in future years when there will be losses. This year $38 million is being transferred from the general fund to cover the pension investment losses which is equivalent to over 200 police officers or staffing for 17 fire stations or paving 24 miles of road. This arbitrage scheme would have the city issue taxable bonds at say 6 percent and then take that money and invest it with the city Retirement Funds. The hope is that the city Retirement Funds would have a greater rate of return than the 6 percent we would have to pay the bondholders. In the last 10 years the average rate of return for city Retirement Funds has been 4.4 percent. (While doing my taxes on Valentines Day I noticed my own mutual funds had returned 3.5% percent over 10 years.)

If the Retirement Fund investments do not perform over time then we could lose more money or possibly break even or make a higher return. Positive investment returns would be restricted to paying off future retirement liability. I think outside of the risk, Pension Obligation Bonds may give the council a reason to not seek second tier retirement benefits the taxpayer can afford for new employees.

The other idea suggested by the union lobbyist was bonding construction and conveyance tax (C&C) funds so that we could spend more now so cuts do not have to be as deep. There again you have to gamble on the future tax receipts and the total amount of C&C funds will shrink since you have to pay the costs associated with bonds. However this borrowing would allow the Council to avoid the question of outsourcing.

It is just another day in local government. Perhaps one way to raise money for the city is to sell bumper stickers that read, “Why do today what you can put off ‘till tomorrow?”

Also posted in Budget, RDA | Comments closed

Candid Camera

Photo radar helps augment traffic safety, as well as that of pedestrians and neighborhoods. A tweaking of the current policy to improve safety will not cost the state any money, and in fact will raise money while at the same time lowering emergency room health care costs. Speeding cars in our neighborhoods continue to remain an issue. The City of San Jose does what it can to manage speeding on our streets with the dollars we are able to allocate.

The City deals with speeders cars in two ways. One is enforcement with our Traffic Enforcement Unit (TEU). TEU are police officers on motorcycles that split their time in neighborhood “hot spots” where speeding is reported. You can report speeding in your neighborhood by clicking this link.

The SJPD aggregates the complaints and then tries to prioritize them as a way to identify the hot spots. The other portion of traffic enforcement’s time is spent at intersections with the highest rate of car accidents. Of course, as pointed out last week on my blog, we only have a limited number of police officers covering a city of a million people.

The other City tool is our Department of Transportation (DOT), which has a small but dedicated group committed to traffic calming who work with a limited budget and are mandated to follow state law. The state determines signage, street markings and the actual speed limit on San Jose streets.

San Jose previously had photo radar: a van parked on streets that took pictures of car license plates that were speeding. However, due to issues at the state level, the program was eliminated. Data from the DOT showed that photo radar reduced speeding on neighborhood streets. Gov. Schwarzenegger has recently proposed an expansion of photo radar.

Drivers who speed are dangerous. Time and time again we have a tragedy of some innocent pedestrian getting killed by an irresponsible driver. Currently, red light running cameras are legal in California; the idea is to also allow that same camera to give out speeding tickets. There is also speculation of allowing mid-block radar as well.

If you believe speeding is a problem in your neighborhood please contact your state representative this week and tell them you support the expansion of photo radar.

Police cannot be on every street 24/7, but technology can help fill the gap. We need our limited police resources for actions that only a police officer can do like investigating violent crime, property crime, gangs and community policing.

On to other matters: On Friday, we released the mid-year budget review. We had less revenue than expected so we drained $4.5 million out of our $10 million economic uncertainty reserve. You may remember an October 2009 blog when a Lobbyist came to the council meeting lambasting the City to spend the reserve instead of saving the money. Individuals are told by financial planners to save six months of living expenses in case of unemployment, so our City, having a one percent reserve is the minimum and should be higher. Going forward we will have $5.5 million left out of an approximate billion dollar budget.

Also worth noting from the report was the annual Hayes Mansion subsidy from the city was $5.9 million which is equivalent to approximately 50 police officers or approximately 40 police officers and opening all of our libraries citywide on Sundays. Take your pick.

Finally our Building & Structure Construction Tax decreased 50 percent—from $8 million to $4 million. It’s important to note that affordable housing in San Jose is exempt from paying these fees that go towards the paving roads. As market rate housing is in the tank the only housing going forward are affordable housing projects that sadly do not provide parks either, again an exemption made by the city council. Think of that next time you buy new shocks or tires for your car.

The City of San Jose Budget Prioritization Survey, available by clicking this link, closes Feb 5.

Also posted in Budget, City Council, Reserve | Comments closed

The Thinner Blue Line

Due to the structural budget deficit and the decline of tax revenues coming into the city, the January police academy has been postponed indefinitely. By postponing the academy the city saves money but risks neighborhood safety.

To be fair, it is a balancing act of what you would like to provide and what money you actually have on hand. However as I and others have pointed out, the city continues to spend money on items that are not in the city charter. In addition it does not require cuts in these “nice-to-have” items, as our core city departments have done in the past and must do again now. This is clearly problematic.

I think we all understand that a police force is expensive, but it is important to have fully vetted and qualified police candidates who provide safety and trust to San Jose residents. Other positions in our city may have an abundance of qualified candidates who apply, but when it comes to police there is a smaller pool with far fewer qualified applicants. It is a position that deserves to paid well, and within the limits of what taxpayers can afford. With that said, other city staff provide value to the organization and residents, but police put their life on the line at any given moment. One can be cynical about the old police doughnut-shop stereotype but in reality police are killed in this country every few days so there is inherent risk. (Click this link to see a report illustrating that fact.)

The problem with pushing out the new police academy class is that we are trying to keep up with retirements, not add additional police but just keep up. We have 80 officers retiring this year (some due to low morale) and the same number next year. It takes 18 months to get a police recruit out on the street. Our police force, much like our professional city staff, is starting to peak on retirements. There will be massive turnover in the next five to eight years for the entire city workforce.

This turnover is why 2nd Tier Pensions (benefits taxpayers can actually afford) for new hires is so important to do now. So by pushing out the academy the ratio of police to residents will decrease even more. What does that mean to you? Well maybe it is fewer police officers that are giving out speeding tickets in our neighborhoods. Maybe it is fewer officers investigating a homicide, rape or burglary. Maybe it is fewer police working on gang prevention and suppression. Certainly it will lead to more police overtime which is an additional variable cost that is tough to budget.

The Council has discretion to ensure that a police academy does occur now, as it only takes six votes. The Council in the short term could simply allocate $4.5 million from the anti-tobacco funds (Healthy Neighborhood Venture Fund) and designate the money towards the police academy for 45 new officers. We have $7.8 million in this fund that has not been spent and could be directed on anything the Council wants.

Others would like to consider using these same funds to allow for more affordable housing and others would like to keep the status quo and continue to fund charities/non-profits which are not in our city charter. The remaining funds could be part of the longer term strategy to hire civilians to swap out police officers from desk duty and get them back on the street. The Police Chief, City Manager and City Auditor agree on this as stated in the report linked here.

I cannot be everything to everyone nor can the City be everything to everyone. We have to make choices that inevitably have trade-offs and make some unhappy. I was elected to vote on issues and make tough choices.

Here is a link that summarizes the peak year, recent year, and projected year performance for the City’s major revenues. Scroll to the right for big negative numbers.

The City of San Jose Budget Prioritization Survey is still open till Feb 5.

Also posted in Budget, Police | Comments closed

Budget Prioritization Survey

The City of San Jose has contracted with a public opinion survey company to poll residents on the city’s budget in a project fondly known as “the City of San Jose Budget Prioritization Survey.” The control group of the survey is 900 residents representing the entire City. They will be contacted by home and cell phones.

In the end, the survey company will try to ensure that the demographic breakdown of survey respondents mirrors the demographics of San Jose, with a certain margin for error. This data will be shared at a public study session at the City Council Feb. 16 at 9am. This will give the Council scientific polling data on budget priorities from San Jose residents. In addition to the phone survey we will be holding a Neighborhood Association/Youth Commission Priority Session this Saturday at 10am at City Hall in room 119 to discuss the budget deficit. Both meetings are public.

Since you may be one of the 1,006,000 residents who will not be getting a call, I wanted to share some of the questions via a web survey and then share the results on San Jose Inside on Feb 8.

On another note, the Council passed a citywide inclusionary housing policy which Councilmember Constant and I voted against. Then a few minutes later, the Council made an exemption to the policy for one section of the City. So although a citywide policy passed for every developer, the City made an exception that one development did not have to comply with the inclusionary housing policy. Makes me wonder; if inclusionary housing is such a good idea then why make an exception?

Here is a link to the City of San Jose Budget Prioritization Survey.

Also posted in Budget, City Council | Comments closed

Recycled Water: The Next Step

I am one of the members who sits on the South Bay Recycled Water Committee, representing San Jose. This committee has investigated and is now recommending a partnership with the Santa Clara Valley Water District to move forward with recycled water and jointly build an advanced water treatment plant.

(I blogged on the topic of recycled water and water scarcity in the past.)

Now, after six long public meetings and a visit to the Orange County advanced water treatment facility, we have reached a tentative agreement that will span 40 years. We will be build an advanced water treatment plant on five acres right next to the existing water pollution control plant in San Jose.

The estimated cost will be $42-$47 million and the costs will be shared: $20-25 million will come from the water district, $11 million from San Jose, $8.25 million from a federal grant and $3 million from the state (Prop 50). The City of San Jose’s portion will not be coming from the General Fund but rather from money set aside from fees for just this purpose. Unfortunately, this is also the money that some would like to borrow so we can build more affordable housing although we have already built 18,000 affordable units in San Jose.

This plant will produce 10 million gallons per day of membrane-filtrated water, eight million gallons per day of reverse osmosis-treated water and 10 millions gallons per day of ultra violet light-treated water. What does all this mean? Well first, we will be able to demonstrate to regulators and the public that we can take wastewater and turn it into drinking water where we are able to remove particles in the parts per trillion level. This facility will allow for public demonstration of how wastewater is transformed into potable water. People will be able to drink the water after it goes through the many steps of advanced treatment, as they do in Orange County. We will also be able to enhance the recycled water quality for existing industrial customers who would like less salinity in the water which is good as it creates more demand for non-potable uses.

This plant is the first step for the facility. There is land adjacent to the facility to expand and produce even more clean water. However, the thought is to build the larger facility over time, as we need acceptance of advanced water treatment from residents. I recall when touring the Orange County facility that we where told that their water has traces of jet fuel left over from the defense industry and they were able to remove it to less then three parts per trillion. That’s amazing when you think about how the technology can get down to cleaning the water at that level.

It is important to remember that almost all the water you and I drink is recycled as only 3 percent of the water on earth is pure. Interesting thing I learned about San Diego is that 95 percent of their water is imported. by contrast in San Jose 50 percent of our water is imported. Imported water is always a risk since it may not be there in the future; however, if we have advanced water treatment, then we would have less risk about imported water being diminished.

Oftentimes people ask, «Why not just desalinate the water from the ocean and make that drinking water.» The cost to desalinate ocean water is very expensive. In addition it takes a lot of energy to clean water. The following is how many KWH per hour for one acre foot of water (a year supply of water for two small families):
1,500 KWH for Advanced Water Treatment
3,500 KWH for importing the water from the Delta
4,000 KWH for desalinization

Our water supply is at risk since there is a finite supply. Are you willing to pay a little more for reliable and clean water?

This will be voted on by the water district board in January and city council in February.

Also posted in City Council, Water | Comments closed

San Jose’s Native Gen X’ers

2009 was a challenging year. San Jose government had its decline in revenue in addition to suffering from an overall structural budget deficit. Many families in San Jose lost their jobs and still continue to struggle in finding another one. All of us have been impacted by the Great Recession of 2008-2009 in some way.

With the eye of the Great Recession’s hurricane ideally behind us, I look to 2010 as a year that government gets back to basics and provides the needs of the community, not the “wants.” For example, government should concentrate on how it will replace retiring police officers,(100 police retiring this year, which is double the normal rate) keep our libraries open and simply pass a budget that takes care of the basic things you would expect the city to provide as stated in the city charter. Basically, the things that you pay for as taxpayers.

I turned 40 in December. I spent my birthday with family and long-time friends. Many of my friends I have known since age five, from kindergarten in San Jose Unified School District, which equates to knowing most of my friends for more than 30 years. The majority of my friends are not political in their occupations and nearly all of them have never been to a San Jose Council meeting. Instead, they are teachers, nurses, Realtors, attorneys, tech folks, blue-collar skilled tradesmen, stay-at-home parents and—as my Mom likes to point out— most are married with children.

Many of my native San Jose friends have a very positive outlook towards San Jose. Their views are somewhat different than what I hear in my council office, where, typically, I hear alot about what is wrong with our city or questions as to why things aren’t done differently.

My friends income levels vary—some own the homes they live in while others rent. However, they all share similar dreams of San Jose’s future. Although they strive for a better city in many ways, they strongly believe that San Jose is a great city today. They are proud that we continue to have one of the safest big cities in the United States, and of our supportive of our police department. They like the small-town feel throughout the City even though we are a City of a million people, enjoy the great weather and, even with a recession, believe this region is still the best place to be by their standards.

When I spoke to my friends at my birthday and over the holidays in December, there was consensus that building the Arena and bringing in the Sharks were great decisions and because of that both female and male are positive on the chance of major league baseball in Downtown. They enjoy going to our Downtown for the Children’s Discovery Museum, Tech Museum, Christmas in the Park and look forward to the reopening of Happy Hollow Park and Zoo.

Most importantly, is they said that they have a choice of where they can live which is why they chose San Jose. That is an important point to remember, since if a person really dislikes where they live then they can simply relocate as many people do all the time.

2010 will carry its challenges and there will be many tough decisions for the council and for individual families. However, I hope the worst is behind us. They say flat is the new up and with that we don’t expect big growth next year but maybe over time. The city on the other hand will take 2-3 years to recover as it takes awhile for revenues to return to municipalities.

I wish you and your family happiness and health in 2010.

Saturday, Jan 9 at 9am is the next volunteer day in our San Jose Municipal Rose Garden. 600 bare root roses will be given away to volunteers who arrive before 9am compliments of Star Roses. See you there.

Also posted in Budget, City Council | Comments closed

Punting the RDA Budget

The Council punted the Redevelopment Agency (RDA) budget last week to February 2010. As has already been highlighted in the news, the state is taking $75 million away from San Jose’s RDA. We need to pay the State off in May and identify where the money is coming from in March (no negotiation or payment plans on this matter are allowed by the State). The legislature, recognizing that this payment would be difficult for all RDA agencies, allowed for borrowing from affordable housing money which is 100-percent funded from RDA. Twenty percent of all RDA money goes off the top to the Housing Department in San Jose. The payroll for the housing department alone is $9.7 million a year for 83 employees for an average salary of $117,000.

The Mayor’s Budget message was pragmatic in that it said let’s not spend any money ‘til we work out borrowing the money from the housing department to pay the State; let’s determine whether or not RDA is able to issue bonds to pay for a capital program—which would include matching the hotel owners’ share and expanding the convention center; and let’s continue negotiating with the County of Santa Clara (which by the way in the last decade has been paid $270 million by the RDA).

The Mayor had a very good public meeting with stakeholders from all sides prior to writing the budget message. Everyone who attended realized the choices are difficult and few options exist. Everyone at the meeting got the same information—that San Jose has already built 18,000 units of affordable housing by spending hundreds of millions of RDA dollars making San Jose the number-one provider of affordable housing in the state of California. Everyone left the meeting understanding that there is no pixie dust to magically fix things. A majority at the Mayor’s meeting felt that economic development should be the priority now.

However, when it came to voting on the budget, another option was voted upon at the last minute that asked for a $25 million reduction in how much would be borrowed from the Housing Dept., and instead look at borrowing from other sources. This option was well liked by the audience (which was made up by mostly paid affordable housing lobbyists and people who work for affordable housing entities in some capacity—the Housing Director is campaigning against the Mayor and is ensuring that she has her supporters at the meetings). This “option” would take money by borrowing monies from the following: Commercial Paper backed by the General Fund, Sewage Treatment Plant Connection Fee, Library Parcel Tax, Sewer Service and Use Charge, Integrated Waste Management, Ice Centre Revenue Fund and HNVF-Anti-Tobacco Funds. This “option”—taking from all of these other resources—was approved on a 7-3 vote with Mayor Reed, Pete Constant and myself voting no.

We have borrowed money from some of these funds before, but that was to balance our general fund so we could fund core services like public safety and not more affordable housing. If we borrow this money now to create more affordable housing, then we will have one less arrow in our quiver to balance the general fund budget in June.

My question to you is: Should we use money that is supposed to go towards core services like sewers and water treatment plant so that we can build more affordable housing that does not pay fees for parks or road paving?

How do you feel as a voter that may have supported the library parcel tax to let that money be borrowed for more affordable housing that does not pay property taxes (property taxes is the number one revenue source to pay for city services) versus what you intended that money to be spent on…libraries.

I remember months back Councilmember Constant and I were criticized because we wanted to use the Healthy Neighborhood Venture Fund (HNVF)/Anti Tobacco money to pay for school crossing guards, a public safety service the City has had in place since the 1940’s. It’s okay to use these funds for affordable housing but not for crossing guards? Hmm…sounds like maybe a vote of the people should be had on how these funds should be spent. With a $75 million deficit just for RDA and another $96-plus million deficit for the City’s General Fund, I am all for the residents sharing their votes via the ballot. If we can ask residents to raise their taxes then we can ask them for direction on spending their money.

I now have a Facebook page for my tenure on the city council. Here is the link.

Also posted in Budget, City Council, RDA | Comments closed

Unions, Graffiti and Utility Boxes

Last Tuesday at the council meeting, we spent approximately 90 minutes discussing the Teamsters Union at the Convention Center. Long story-short, this is a labor dispute between two different union locals that will be settled by the National Labor Relations Board. However, in the meantime, the Convention Center (which is the largest source of the City’s hotel tax receipts and drives airport traffic) is getting negative PR which is affecting prospective convention business in San Jose.

Whether it’s one union local or another, the fact is the Teamster jobs are taxpayer subsidized jobs since the City owns and operates the Convention Center where they work. When everyone chooses to fight as we are then we slit our own throats, since the taxpayer is on the hook for the annual subsidy—which will grow if we are unable to book convention business.

* * *

Last Wednesday, at the Neighborhood Services committee, there was an update on the anti-graffiti program. The City painted over 100,000-plus graffiti tags last fiscal year. The City is meeting its goal of removing gang graffiti in 24 hours, although the staff is resource- constrained.

Also related to graffiti was the annual year-in-review by the San Jose Downtown Association last Friday morning. At the meeting, they spoke about the success of the Groundwerx crew that is privately funded by a Property Business Improvement District. Groundwerx spends much of its efforts cleaning Downtown, with an emphasis on graffiti. I think it would be great if a judge (who presides over graffiti taggers) made those offenders do community service with Groundwerx to help clean Downtown for days/weeks/months, rather than the small penalties today.

One particular challenge with graffiti are the utility boxes that are all around our city. These boxes are privately owned by the likes of ATT, Comcast, PG&E., etc. The graffiti bozo’s (with the City lacking Singapore-style punishment) constantly mark up the boxes with their tags or gang tags. The committee discussed the possibility of creating an ordinance that would remove graffiti from those utility boxes asap. Ideally, we would not need an ordinance as the utility companies would clean it up themselves in a timely manner; unfortunately, that does not happen. So one way we could ensure that the companies would understand the importance of taking care of the property in San Jose is to adopt and execute a fine to the utility companies for any graffiti left on a box for more then 72 hours. Or they could contract with the City to pay us each time we clean up the tag.

* * *

The big vote this week in front of the Council is whether or not to give direction to city attorney to make binding arbitration for police and fire open to the public. The arbitrator who does not reside in San Jose makes binding decisions on police and fire contracts but is not accountable to the taxpayers. Yet the arbitrator has the power to force the city to spend unlimited amount of tax dollars. Not even the Mayor or a Councilmember is allowed to hear what is said. I bet you can already predict the votes as the last vote to make union negotiations public was 3-8, with the «no» votes prevailing.

Also posted in Graffiti Abatement | Comments closed

Fall 2009 General Plan Hearing

Prior to Mayor Reed, the City of San Jose would amend the General Plan (GP) approximately seven to twelve times a year; which equates to about once every month, give or take. During this time, about 1,200 acres of industrial land were converted to residential housing. As a result, the City lost 1,200 acres of land that could have been home to jobs. A sizable percentage of the 1,200 acres was in my district.

Since 2007, the City hears GP changes twice a year. With the adoption of the conversion policy (which provides a process for land zoning conversion) the council hears far fewer amendments regarding changing industrial zoning to residential.

Last Tuesday, the council had the Fall GP Hearing. This meeting continued past midnight and covered a litany of land use situations, some of which are listed below:

• Transit oriented development on the periphery of Downtown.
This item moved forward with unanimous support.

• Revitalization of two strip malls with the addition of housing in Evergreen and another on Hillsdale Ave.
Both these items moved forward with unanimous support.

• Infill development of 35 executive homes next to Silver Creek.
This item moved forward with unanimous support.

• Church locating in an industrial area.
This issue was approved with a 9-2 vote, with Vice Mayor Chirco and myself voting against it. (I voted against it because it does not conform to our GP and ends up creating a domino effect of converting the adjacent industrial parcels over time.)

Most of these items will be back before the Council one more time during the zoning process for the final details like architecture, lot sizes, height, parking, etc…

If you are interested in viewing past council meetings and/or other committee and commission meetings, you can do so at the City of San Jose’s website.

Scroll down and select the meeting to view. The agenda for that specific meeting will come up and you can jump to that particular agenda item to hear what was said.

Also posted in General Plan, Uncategorized | Comments closed

Feedback From RDA Survey is Beneficial

A couple of weeks ago I put together my own web based Redevelopment Budget survey. I shared financial information in bullet point form in the introduction and then gave information throughout the survey. In some cases I would state the dollar amount given to a particular program and then ask a question. More than 600 people completed the survey, which required that each question be answered. The survey could not be taken twice.

As with most issues that involve money, the feedback to my survey was mixed. I had a person who refused to even participate because they didn’t like how I set up the survey. Others lauded my courage to share data and seek their input. They felt I was taking a risk to allow residents to share their concerns.

Web surveys are not necessarily scientific surveys, since web surveys allow anyone to participate. As we know, a true scientific survey controls and limits who is surveyed by gender, age, race, income level, voter registration and geographic location of the respondent. Scientific surveys can cost about $40,000 for 1,000 people.

Viewpoints are subjective. Whereas one person may view a question as biased another may view it as objective. However, the most important part of a survey question is that the data be factual. In my survey, there were approximately 10 comments out of over 600 people who completed the survey who felt that particular survey questions were biased. For example, one person told me that I was “leading” the survey because I said that San Jose RDA has spent hundreds of millions of dollars on 18,000 units of affordable housing. I shared that this is information is factual and not leading.

My survey shared, in synopsis form, how much money has been spent on various issues. Many people did not realize that San Jose is the leader in affordable housing. Some respondents shared that they are very pleased with the Strong Neighborhood Initiative (SNI). While others, agreeing with affordable housing and SNI, felt that that we should spend money on economic development this next fiscal year. My survey allowed those who chose to participate an outlet to share concerns, recommendations and rank their priorities for RDA monies.

As I have said, there were a few participants who felt the survey was biased; however, when I did a cross tabulation all but one of them chose Affordable Housing or SNI as more important then Economic Development. Cross tabulation also showed most of these specific participants felt that we should not borrow money from the Housing Department to spend on Economic Development this year. In addition, most of these participants shared that it was okay to spend money on a small fraction of neighborhoods in San Jose even though there are neighborhood infrastructure needs citywide.

After reading comments and speaking with survey respondents, I would add more choices to future surveys. For example, when it comes to ranking priorities I would add two more options; “Save Money”—since some people would rather not spend—and “None of the Above.”

The survey required that beach question to be answered, identical to how a councilmember “must” vote. Many times the Council votes on an ordinance or budget that individual councilmembers may not agree with 100 percent, so sometimes council votes for a package of things that are a bit uncomfortable. It’s the same feeling that some of the respondents felt when asked to make decisions regarding the survey.

Another item I would add in the future is a web link if available for additional information. For example, respondents did not necessarily know what specific improvements were proposed at St. James Park, Japantown, Civic Auditorium, etc. The RDA budget is available online, however specific information on the proposed improvements is not easily found.

Thank you to those of you who participated in the survey. I know it was not easy and may have caused you to feel conflicted. I appreciate your time to engage and share your viewpoints with me.

Some of the results:

• 69.5% out of 787 respondents felt that borrowing from the Housing Dept. this year for Economic Development was okay.

• 70.8% out of 763 respondents disagreed with spending RDA money for a small fraction of neighborhoods in San Jose versus overall.

• 79.4% out of 709 respondents felt that Economic Development should be number one priority of RDA money.

• 59.7% out of 709 respondents approved of the Convention Center expansion.

• 52.8% out of 709 respondents did not approve of RDA land banking for a Downtown Baseball stadium.

• Here is a link to all the results, including 268 comments.

Finally here is a table from Mayor Reed’s RDA Budget message that shows how economic development is better for city tax revenues and ongoing jobs then affordable housing.

Also posted in Budget, RDA | Comments closed

Small Decisions Can Result in More Layoffs

Last week, at the city council meeting, I removed an item from the consent calendar on the agenda for discussion. As you may remember from my blog about San Jose’s million-dollar golf nets, consent calendar items do not have individual discussion, but rather are voted on all at the same time. If one wants to discuss a consent item, you have to “remove” it for discussion.

The item I removed was asking $993,876 for the library to spend over the course of seven years on an online tutoring service for kids. Nearly a million dollars is a significant amount of money. The $993,876 was not restricted funds and could have been spent on librarians instead. My comment/question to the council was: If we know we are going to have to do layoffs of library staff on July 1, 2010 to balance the budget, then maybe we should hold off on discretionary spending so we can retain staff to keep our libraries open. This expenditure is approximately two librarians salary each year for seven years. My comment fell on deaf ears and the council voted to spend this money; I voted against this expenditure.

When it comes to the libraries, the core deliverable to me is that libraries are open as many hours a week as we can afford, so users can access information and have a place to study. Any and all other programming should be funded after libraries are open seven days a week. If we have funds left over after libraries are open seven days a week then we can start evaluating the option of adding different programs. Until then, the City’s money should be used to keep libraries open with staff.

The online tutoring service could be canceled from year to year; however, good luck ever canceling a program/service once it starts.

On another note, I posted a survey last week regarding the Redevelopment Agency (RDA) budget. The RDA board adopts the final budget on Dec. 8. A person shared with me that the question I posted below (which appears on the survey) was “biased.” I shared that the information I gave was factual, not biased. I thought I would share the question with you here. I have added commentary in bold parenthesis:

The Redevelopment Agency has spent $774 million on housing (true) making San Jose the number-one provider of affordable housing in the state of California (true) by financing 18,000 units (true) of affordable housing while neighboring cities do next to nothing for affordable housing. (Neighboring Cities have not met the Association Bay Area Governments (ABAG) affordable housing targets, while San Jose has exceeded overall ABAG affordable housing targets). With so much given to affordable housing and so many people in need of jobs (12.5 percent unemployment), should the RDA borrow money from affordable housing reserves this year, as allowed by state law (true), to be spent instead on economic development to help create jobs?

The Redevelopment budget survey can be found here. It closes this week.

Happy Thanksgiving San Jose.

Also posted in Budget, City Council, Libraries, RDA | Comments closed

RDA Budget Survey

Last week, the council had public hearings regarding the upcoming 2009-2010 Redevelopment budget. Mayor Reed ensured that the public had both a day and night session to attend, allowing more people to participate. In addition, tonight (Nov. 16) at 6pm the mayor is hosting an additional public meeting at City Hall to garner feedback on the RDA budget.

During last week’s public hearings, the usual lobbyists—those who are paid to speak at council meetings on behalf of special interests—attended and spoke. The lobbyists have also been known to orchestrate the other speakers, giving them colored stickers to wear and scripts to read from.

Others spoke on what the RDA money should be spent on, which happened to be items that might affect their own future employment. For example, people who work for an affordable housing developer will speak to the need for RDA money to be spent on affordable housing.

This past October, I held a meeting in the District I represent (on a Saturday) to talk only about the RDA and the upcoming budget decisions. At my meeting, there was nearly unanimous support for spending the limited RDA funds on economic development. Unfortunately, the council is not hearing this at the public hearings at City Hall since most residents are busy with work, family or seeking a job.

Therefore, I have prepared a web survey for San Jose residents to fill out online. This survey is much shorter then my May 2009 General Fund budget survey, but does require that each question be answered and may be only taken once. I will share the results here on San Jose Inside.
The link is here: Redevelopment Agency Budget Survey.

Also posted in RDA | Comments closed

Do Things Differently

Last week, the council had a special meeting to discuss the upcoming $96 million budget shortfall. $96 million is the equivalent of eliminating all library, park and community center positions citywide. My fellow councilmembers and I gave the city manager direction on how best we think the budget gap could be closed.

The first part of the meeting covered the shortfall—which may still grow by either continued lagging revenues from sales taxes and property taxes, or the state legislature grabbing more city funds. It is clear that there are no easy answers. I hear people say “since the stock market is up then the city budget will be ok.” The stock market going up does not provide jobs to unemployed San Jose residents nor does it bring revenues to pay for city services. The only benefit is it might reduce our pension matches slightly next year; however our pension portfolios are invested in more than equities.

We spent time talking about raising taxes on residents, such as a sales tax increase to pay for city services. I said that I would prefer that we increase taxes on card clubs and allow them more tables as allowed by state law, which would bring in as much as $12 million. The card clubs already bring the city approximately $13 million each year.

I also mentioned that taxing medicinal marijuana would help our budget deficit as well.

We then went on to options that would reduce per-employee cost, whether it be pay cuts, increasing medical co-payments or 2nd tier retirement plans for city employees not yet hired. As you would expect none of these options were popular with the council.

Then city management unveiled, its “Approach to Prioritizing City Services” AKA “Core Services.” This concept would be a long stakeholder engagement process that would include scoring and weighing the value of 450 city programs identified so far. However it would not necessarily eliminate programs that scored low. The presentation contained buzz words like «engaging stakeholders,» «peer review,» «finalize a work plan.»

Others said it is not right to prioritize and rank since it puts certain city services against each other. I shared that I am willing to participate, but that the approach presented is meant to give “political cover” in making decisions.

I believe that we can’t make paid interest groups happy all the time and at some point we have to vote to make changes that may be unpopular. The Council was elected to make decisions on behalf of everyone in their district and City, not just a few. This process could take a year, therefore, I immediately offered what my core city services are: Police, Sewers, Fire, Streets, Planning, Emergency Preparedness, Economic Development, Libraries, Parks and Code Enforcement. The presentation left out an obvious city priority: infrastructure. Without sewers and streets life in a city comes to a stop.

At the end of the meeting, the Council voted on my memo titled, “Make Union Negotiations Public.” The memo asked that closed door union negotiation meetings, which take up 75 percent of the city’s budget be public meetings. It did not pass on a 3-8 vote. The majority of the council voted to keep these meetings behind closed doors even though these past meetings are why we have a structural budget deficit.

I have posted the presentation from the meeting on my Council website labeled, 2010-11 Budget Planning – Nov. 5, 2009.

Also posted in Budget, City Council | Comments closed

Implementing Proposition 215 in San Jose

I support an ordinance in San Jose that allows for the cultivation and sale of medical marijuana dispensaries/collectives.

Proposition 215, which was passed with voter approval in 1996, called for the legalization of Medicinal Marijuana with 56 percent of the voters in favor. Santa Clara County supported this proposition by 64 percent. Since then, the legislature has passed SB420 which dealt with the actual implementation of Medical Marijuana.

In 2008, the State Attorney General presented Guidelines for the Security and Non-diversion of Marijuana Grown for Medical Use. Most recently, on Oct 19, 2009, the Obama administration stated that they are not prosecuting medicinal marijuana in states where it is legal: California, Colorado, Oregon, Washington, Vermont, Maryland, Michigan, Montana, Nevada, Maine, Rhode Island, Alaska and Hawaii.

I understand that proposing to allow the cultivation and sale of cannabis will raise questions and concerns. This issue did not happen overnight, but rather has taken a pragmatic and thoughtful approach which has included voter approval, state and federal guidelines.

Marijuana for medical use is legal. Thousands of people who are living with painful ailments currently use cannabis for potential deadly diseases like cancer, HIV/AIDS, Multiple Sclerosis and others. It was not unheard of for doctors in the past to have told their patients to have their family members go and purchase marijuana for them, illegally, since the medical benefits of cannabis help the patient.

Currently, San Jose residents travel to San Francisco, Oakland and Santa Cruz to obtain medical marijuana with a doctor’s prescription. However, since this is a legal use and and in my opinion, especially since the voters approved the use, San Jose should adopt some type of ordinance that allows and monitors the use of cannabis collectives in San Jose. In addition, the way that the dispensaries are set up, money is used as an incentive for the City and uses as a deterrent for anyone who would choose to disobey the law.

Medicinal Marijuana Dispensaries will open, whether San Jose has an ordinance or not, and will use the court system to stay open. Most recently the city of Los Angeles which has over 500 dispensaries of which only 186 our licensed, lost their court case in limiting how many could exist in their city. If San Jose sits docile, then dispensaries may open in places where we do not want them to be located. In addition, if medical marijuana dispensaries get the right to deliver their product through the mail, then San Jose would lose any opportunity to gain revenue from taxes and fees.

Last week I submitted a memo that includes the following: directing the planning staff to bring back an ordinance to the city council in four months; use industrial land since typically industrial land is not next to schools or churches. The goal is that this use would add value to industrial property owners who would might be less likely to try and convert their land to housing.

An example of an existing ordinance is the City of Oakland. Oakland voters passed a ballot measure by 80 percent to raise the tax on marijuana to $18 for every $1,000 of sales. My suggestion is to set it at nearly twice as much: $30 for every $1,000 of marijuana sales. I believe that depending on how many dispensaries San Jose would allow could bring in $500K to $1 million to the city. I have suggested that this money be put aside and spent on core services which would be police officers and street maintenance.

Here is a link to the entire memo: 10-27-09 Adopt Ordinance for Legal Medical Cannabis Use San Jose

Also posted in Business, Medical Marijuana | Comments closed

All About Money on Tuesdays

A variety of issues were discussed at last week’s council meeting that dealt with city finances. Jennifer Maguire, the Director of our Budget Office, shared that the ending fund balance this year is 1.3 percent. The city has always had an ending fund balance for as long as anyone can remember.

It is both a science and an art trying to guess how variable revenue sources such as sales taxes will end up. The goal is to be conservative so we have a little left over to put in our Economic Uncertainty Reserve. This reserve acts as our savings account.

The money in the reserve is not earmarked for any specific purpose. One never knows when the state of California might take more revenue from the city; therefore, it is important to have money saved “just in case.”

To give you a little flavor of how bad the some our revenue numbers are:
Sales Tax was down 14.5 percent in 2008-2009.
The last two quarters of 2008-2009, Sales Tax dropped by 29.3 percent and 28.2 percent.
TOT (hotel tax) was down 19 percent in 2008-2009.
Construction & Conveyance was down 24 percent in 2008-2009 (down 36 percent in 2007-2008).

After these facts were stated at the council meeting, a paid lobbyist from the union spoke during public comment and lambasted the council for carrying a 1.3 percent ending fund balance. It appears that this person wanted the city to spend all of it’s money and not save any.

As way of background regarding our past surpluses, from 1989-2009, on average we have ended in the black each year with a surplus of 1.8 percent. The highest year was in 2000-01 where we ended with a surplus of 5.6 percent. (There was a huge growth in sales tax that year which contributed to the high number..incidentally, that was when the city used some of the extra money to first establish the Economic Uncertainty Reserve).

The paid union lobbyist that spoke actually worked for the city during the Mayor Hammer years (1989-1996). The average surplus during the Hammer years was 1.3 percent, with a surplus as high as 2.4 percent.

Personally, I don’t think it is prudent to spend every last dollar of the city’s finances; just as I have my own personal savings account, so should the city.

The issue of outsourcing some city services was also discussed. As usual, the council voted down any chance of outsourcing, which is a subject that comes up again and again. I support some outsourcing of non-core city services. I would take the savings that the city would have from outsourcing and either shore up the budget or preferably provide more core services—such as police and libraries—to the residents.

Outsourcing may not equate to laying people off, rather, the current employees might remain. We have attrition at the city, and some city employees could supervise the contractors work. A simple fact is that the city saves $1.2 million a year from having outsourced janitorial for the city hall night shift. With savings like $1.2 million we could either open all branch libraries citywide on Sundays or Mondays or hire 10 police officers. We are simply reallocating money to what we feel is most important, as you do every day.

The debate will continue as the city will be looking at hundreds of layoffs in June of filled positions to balance the $91 million budget deficit.

Another agenda item was the city’s love-hate relationship with our two legal card clubs. These two businesses combined bring the city $13.5 million a year which is half of the citywide library budget. The clubs were looking to move out of San Jose since San Jose’s regulations are tougher then state law. As a result, the council voted to allow fewer restrictions—but still more restrictions than the state requires.

No matter what your view on gambling is, it brings our city a substantial amount of money. People who choose to partake in these activities can do so in San Jose or they may choose to gamble by logging onto the internet. However if everyone chose to gamble on the internet the city would have to cut $13.5 million out of the budget or raise taxes.

Finally, last week’s vote on not exposing police records saved us from cutting city services to the residents. Had that passed it would have created a massive burden on police and the city attorney’s office. We would have had to devote resources to manage the deluge of requests which would mean taking police off the street and attorneys off of litigation which are both core services.

If we really want sunshine then lets make all labor negotiations public meetings. Public meetings would shed light on our city finances and save an incredible amount of time/frustration going back and forth.

On any given Tuesday we could save money, spend money or break even which is essentially do no harm.

Also posted in Reserve | Comments closed

Nighttime Public Meeting on Police Issues

The Public Safety, Finance and Strategic Support Committee, which I sit on, had a special meeting last Wednesday night. Usually, this committee meets during the day. This special meeting was being sponsored by the Independent Police Auditor (IPA) and the City Council stemming from the alleged racial profiling arrests Downtown for pubic intoxication. This is one of two meetings to be held at night to elicit public opinion about our police force. The next one will be spring 2010.

The city manager briefed the audience on the background of what San Jose has been doing to address this issue like police training, working with La Raza Round table and the Consortium for Police Leadership in Equity (CPLE) initiative to study our police force by an academic nature. Also, a new revised citizen complaint process is being worked on by Police Internal Affairs and the IPA. Finally, he described a pilot project with the Taser company for their new product called Axon which is a small camera that police would wear and turn on while arresting individuals.

A card was given out to each speaker that had three questions:

1. What reactions do you have to City efforts to date?
2. What ideas do you have to address policing issues?
3. What do you want to know about police services?

Here are some quotes from speakers at the meeting:

Question 1:
Kathleen:
Proud that we have looked at all sides of the issue, however city leaving out people that support the police and victims rights groups.

Scott:
It is night and day compared to where we were in 2008. It is positive and the vibe Downtown is good.

Thought 2008 was a PR black eye for Downtown. Sean Webby did good reporting. Chief Davis moved on recommendations from the Intoxication Task-force.

Gentleman from Church Ministry:
Positive viewpoint of police.

Kathy:
Mentally ill woman spoke and made no sense. (She is a regular speaker at Council meeting who introduces herself as the US President.)

David:
Appreciates the efforts. Felt that meetings should be held throughout city instead of city hall.

Raj:
Wanted to applaud city mgr and police with improvements on reducing the arrest rate. We still have a way to go like what is the underlying causes between community and police. Get to true community policing. Would like to see city drop Tasers. Look at other arrests other than drunk in public.

Bob:
Not a finger pointer. Feels that some are still pointing fingers at police and that they should communicate and be constructive. Proud of police dept.

Question 2:

Kathleen:
Hire more police officers as they are tired and overworked. Downtown bars need to be more accountable for who they bring to town. Victims rights advocates should be part of every committee. IPA should disclose who they collaborate with since some groups are not viewed as neutral.

Scott:
Constructive conversation is bringing community policing more into alignment.
Downtown Assoc stayed in the conversation with the Intoxication task force and did not walk out like other groups.
Need to keep training up as new people and business come to downtown.

Issa:
Too bad city waited ‘till it was a problem. Son’s car was searched without a need. Disappointed with Chief on his meeting with him. Would like police to use consent forms when doing cars searches. He himself was searched at Starbucks by police. Consent forms for searches his priority.
David:
Friends in minority groups fear that police is not representative of the population. In SF the police are recruiting at street fair parties. San Jose should do the same and recruit police that are more like the population of the city.

Teresa:
Husband hit by car on The Alameda and helped by police officer home. Good example of community policing. Community policing helps rid negative connotation of police. Highlight positive experiences. Police should have longer terms in the neighborhood. More training on dealing with individuals with mental illness. More access to public records.

Question 3:

Kathy2:
Commend the city of San Jose for addressing this issue head on. Concern with early intervention workplan. How would the city identify the officers and how often. Represents the NAACP.

Kathleen:
What is being done to involve citizens in community policing? Neighborhood watch and crime prevention are great programs. What is happening to bring youth and police together? More peer counseling where youth would shame others youth from doing bad things.

Open Forum:

Christian:
Disappointed with IPA choices on collaboration with groups that are not neutral. Include victims rights advocates.

David:
Human rights commission is made up of 13 community members. Rep from IPA and Police attend the meetings. If you want to make a complaint then coming to the human rights commission is a good place to do it. Likes Citizens Police Academy and feels city should do more. Also thinks the city should fund human rights commission to do outreach.

Kathy:
Said we were stealing her body parts. Illegal immigrants are stealing our jobs. Council should be charged with embezzlement. The Fairmont Hotel is my hotel and you have not paid me for it yet.

Kathleen:
Thinks there should be more outreach to neighborhoods (all neighborhoods) police do a great job and have caught many of the murderer’s who killed in San Jose. Vigil for police will be an annual event honoring our police.

Issa:
Supports the police. To support it is to help improve it. Take the time to ask police in other cities about consent forms for searches.

Francisco:
(With New Harvest Christian Fellowship) Did not hear about solutions that attack the problem at hand to become more productive citizens. Churches offer programs like a 12 step program with drug and alcohol abuse. We have a family outreach and intervention program that collaborates with 45 business to have a community event. Invited the police however did not attend/support (unclear).

Bobby:
Include the police officers, the Police Officers Association. spoke to 200 youth about opportunities. Sat down with Raj and ACLU to talk and listen. The POA is available to help. Willing to attend the Human Rights commission. Straight Talk.

Paul:
Support the committee’s work. Best city council that we have had in a long time. Sometimes the police are asked to change but are not part of the change; agree with Bobby. Otherwise police get squeezed in the middle. Overall doing a good job since your trying.

On a separate issue and with much sadness but happiness for him and his family, Jim Helmer, the Director of Transportation, retired from the City of San Jose. I personally enjoyed serving with Jim and his supporting team whose main concern is safety for pedestrians and drivers. He will be missed. But have no fear as our new director is Hans Larsen who has a great background and is very capable.

Also posted in Independent Police Auditor, Public Safety Task Force, Rob Davis | Comments closed

Last Week Stunk

Last week, I toured the City of San Jose’s sanitary sewer system along with Public Works staff. For those of you who may not be aware, sewers in San Jose stretch out for 2,200 miles and range anywhere from 100 years old to brand new. The “sewer freeway” is at Zanker Road, where four large- diameter lines converge towards Alviso. They run side by side in different sizes and during the dry season we turn two of them off since the flow is slower without rainfall. This gives a rest to the other lines so they can be inspected and also helps move solid materials (grit) through the pipes.

Solid debris is made of mostly sand and organic matter (coffee grounds, egg shells, bones), toiletries, to massive clogs of hair the size of a 4th grader. One method to clear the line is to use the “Pig Launcher.” This is where a neoprene bullet-shaped cleaning plug is shot down the pipe with a blast of water from a pumping station and then retrieved at the next pumping station.

Replacing sewers pipes is important and is ongoing year-round. Since many of the pipes are small, we use technology to travel down the pipe. For example, we have a robot that cruises down the sewer pipe with a bright light and camera that rotates to view the entire circumference of the pipe. The rotating of the robot allows staff to see a break, root intrusion or large objects.

Digging up and replacing the pipe is a big project that impacts anyone connected to that line. One method that used is a process that blows a tube, (like a long tube sock) into a section of pipe that requires fixing. Hot liquid is then pumped through the liner causing the material, a form of epoxy, to expand. With the liquid removed, the material hardens. Next a robot is maneuvered through the new pipe cutting a tap out at each residence allowing the flow from each household to resume. The pipe diameter becomes a bit smaller—however the pipe is completely smooth with all breaks and cracks repaired.

All cities face the challenge of maintaining sewer infrastructure over time. The items we flush begin to decompose within the sewer mains and can create gases that over time can corrode concrete pipes. Also, trees through root intrusion break the pipes, which is problematic since San Jose loves its tree canopy. So when you see a beautiful tree-lined street it inevitably will create more problems with the sewer lines. It’s a dilemma for tree owners as those roots are thirsty and will break pipes looking for water—not to mention the havoc on sidewalks. Personally I am not prepared to take out my trees, however I will have to budget for future expenses like plumbing and sidewalks because of them.

The largest culprit in blocking of the sewer pipes is “FOG”—fats-oils-grease. Pouring these into your kitchen sink is problematic as it travels from your home to the six inch pipe (typical residential sewer main) on your street where it eventually merges with a larger pipe as it moves north towards Alviso. Homeowners are responsible for the “lateral” pipe from their home to sewer connection. If your pipe clogs up because of “FOG” then the homeowner would have to pay out of pocket to get it fixed.

Personally, I was hoping to get dirty and get down in the sewer and walk around like the people you see on the show “Dirty Jobs” on the Discovery Channel. However, the Occupational Safety and Health Administration (OSHA) rules required that a breathing apparatus be used while the person going down is hooked to a harness. Without the gas mask a person would pass out due to the methane and other gases. Needless to say, the sewer can be stinky, so iron salt is added into a large sewer main near Blossom Hill Road so there is less odor. In addition, a pilot program has been launched allowing hydrogen peroxide to be injected into the sewer mains over by Bay 101 to minimize the smell.

The smell is why we have the buffer lands between the sewage treatment plant and people who live nearby. Over time, we may see development of these buffer lands. For example, this area was where Tesla Motors was proposed to locate in San Jose, however, my mantra is always buyer beware. We also have sheep on the buffer lands so that we don’t have to mow it. As I looked at the buffer lands, it reminded me of something out of an African savanna as many sheep were huddled for shade. I did not observe rats or mice in the sewer as I pictured from movies, but there were lots of cockroaches visible when lifting up a manhole cover.

We observed the sewer flowing through the larger pipes called “interceptors,” moving at about 8-10 feet per minute which seemed pretty fast. I expected the water to be thicker, however it was actually viscous. San Jose is lucky in the we are fairly flat but we do have a slight decline from South San Jose towards Alviso so fewer pumping stations are needed than in other cities.

Managing sewers for a city our size is a very technical job and one that requires skilled professionals that I would include in the realm of public safety. Finally, visiting the sewers reminds me about the importance of infill development and building within versus building outside of the urban service area.

Also posted in Public Works, Sewers | Comments closed

Just Short of Singapore

At the Rules Committee last week, there was a proposal to amend the Graffiti Abatement Ordinance for juvenile offenders.

When someone gets arrested for doing graffiti in San Jose or other cities in Santa Clara county they are punished via the County court system. However cities do have a municipal code where offenders may pay a fine. State law does an adequate job of prosecuting adult graffiti offenders, however, some would say not such a good job of dealing with juveniles, since county probation does not want to spend the resources to supervise their community service work.

The proposal at Rules is asking that minors who are convicted of doing graffiti perform 24 hours of community service work which might include removing their own graffiti and other activities. The memo also states that the minor could pay a $500 fine in lieu of the community service, and if the juvenile could not pay the parents would be liable. The city of San Jose currently spends $2 million a year removing graffiti.

This might sound like a step in the right direction, but I’m not sure it’s enough. A couple of downtown residents spoke at the Rules committee and said they want more punitive measures against these vandals of private and public property. I agree with the speakers. We should raise the community service hours and the fine to the highest amount allowed by state law. We may choose collectively to not be as punitive toward graffiti vandals as Singapore—but a higher penalty would help discourage the vandalism that is rampant throughout our city.

As far an inexpensive way of doing community service, we might assign neighborhoods where the juvenile would pick up trash continuously. Or assign them to areas where they have to paint out graffiti. However, this could be problematic if they are removing a gang tag and the gang members might retaliate against them. It is unlikely gang members would retaliate against city employees doing their job painting out graffiti. Therefore maybe the offenders should accompany our city employees and be put to work if possible under Workers Compensation rules.

Another option would be to to have the juvenile report to a park and be instructed by a city gardener to pull out all the weeds out of a large park. Then the gardener would check at the end of the day and if the work was not done the offender would not get signed off. We need to find an inexpensive way of managing juvenile offender community service while managing our risk of lawsuits if they got hurt. So lets minimize our risk and not assign them to freeways and expressways but keep them in the neighborhood. I would imagine the hours of punishment would need to be more like 250 hours, or again whatever is the maximum allowed by state law.

This topic will be addressed in the Mayors Gang Task Force and will come back to Rules and eventually to Council in a few months. There are many legal and jurisdictional questions that must be answered by the city attorney, county court system and state law so thus the delay.

What do you think is the appropriate level of punishment? Or do you think they are artists and should be allowed to express themselves? What type of a punitive community service system would you suggest/design that would be inexpensive to administer and would be an easy option for a judge to assign the offender to this system?

Also posted in Graffiti Abatement | Comments closed

Plastic or Cloth?

It is well known that the city of San Jose is on its way to banning single-use plastic bags starting in Jan 2011. An ordinance will come back to Council in 2010 for final adoption which will contain different options. The most problematic option I could see is a fee put on single-use bags.

The 25-cent fee would be charged for each bag and would not go towards libraries or police but rather to hire new people to administer the program and regulate retail stores. The store owner would have to collect the fee, record it, give it to the city and then possibly have to undergo audits. This is a painful process that a business does not want to take on. For the resident who pays the fee there is little value in paying for salaries of people to manage this program. It seems to me that most residents would rather have fees or taxes go towards neighborhood services that would enhance their daily lives.

If plastic bags are so bad, then let’s ban plastic bags altogether rather than create a plastic bag fee bureaucracy.
However, I believe the plastic bag debate is the beginning of discussions regarding the environment. Americans use more resources per person than all other countries. American consumers’ choices have an impact on the environment. Banning products that are not environmentally friendly will also have an effect on those who are employed in those industries. But are plastic bags the number one problem for San Jose? No. The City of San Jose needs to avoid bankruptcy and switch to a two-tier pension system for new city employees.

However, staying on topic, the plastic bag issue does speak to the impacts of consumption. Certainly plastic water bottles are menace to society with the plastic bottle island in the Pacific Ocean. (Sidenote: Did you know there is less then one person in the US government regulating bottled water for health and safety?) How about banning Styrofoam? Or all that packaging to protect our consumer electronics that could certainly be done in a more environmentally friendly away. Or maybe banning beef, as it takes 500 quarts of water to produce one pound of beef while the same amount in grain takes 2-20 quarts. Or banning incandescent light bulbs since new CFL bulbs use 75 percent less energy, produce 75 percent less heat and last 10 times as long.

If we really want to divert waste from our landfills to implement the San Jose Green Vision then perhaps we look at disposable diapers. Disposable diapers take up the most non organic space in land fills. Back before the days of convenience and mass consumption people used cloth diapers that were washable. Having changed a diaper in my life, I can definitely see the value of getting rid of that smelly diaper but it has its impact.

Eighty percent of the diaper changes in this nation are done with disposables. That comes to 18 billion diapers a year which is a $3 billion industry in the USA. Each diaper has an outer layer of waterproof polypropylene and an inner layer of fluff made from wood pulp plus super-slurper sodium polyacrylate that can hold a hundred times its weight in water.

Those 18 billion diapers add up to 82,000 tons of plastic a year and 1.3 million tons of wood pulp—250,000 trees. After a bowel movement these diapers are trucked away to landfills, where they sit as neatly wrapped packages of excrement, it is estimated to take 250-500 years to decompose, long after your children, grandchildren and great, great, grandchildren will be gone.

The instructions on a disposable diaper package advise that all fecal matter should be deposited in the toilet before discarding, yet less than one half of one percent of all waste from single-use diapers goes into the sewage system. Cloth diapers are reused 50 to 200 times before being turned into rags. Disposable diapers generate sixty times more solid waste and use twenty times more raw materials, like crude oil and wood pulp then cloth diapers. In 1991, an attempt towards recycling disposable diapers was made in the city of Seattle, involving 800 families, 30 day care centers, a hospital and a Seattle-based recycle for a period of one year. The conclusion was that recycling disposable diapers was not economically feasible on any scale.

I believe consumers and different levels of government will be dealing with these choices in perpetuity and there will be many debates and long council meetings across the country.

Thank you to the more than 100 people that turned out to City Hall last Monday to watch the film about water scarcity called FLOW.
The next event is discussion with the San Jose Redevelopment Agency at the Willow Glen Library on Saturday Oct 3 at 10:30am.

Also posted in Plastic Bag ban | Comments closed

Land Banking Without Public Money

Last week, at the Council meeting, there was a contentious land use item. A housing developer is asking the council to approve a rezoning of land to allow a 117-unit affordable Shared Room Occupancy (SRO).

Currently, there are business owners, adjacent property owners, and residents who do not support this project. I have been a councilmember for more than two years and I have never seen each of these groups on the same page. Ninety-five percent of the adjacent property owners are against the rezoning. They took the time to file and get their signatures notarized for a zoning protest application and therefore it requires eight council votes to approve the project instead of six.

Ninety-five percent is unheard of—thus showing a high level of opposition. One of the adjacent industrial property owners said, “where will people work in San Jose if the Council continues to change land for jobs to land for housing?” Industrial uses are becoming harder to locate in this City since residents do not want noise or truck traffic.

All of the speakers spoke against the rezoning at the council meeting. I had already heard these comments, because I attended the community meeting in my district for this project and watched the entire planning commission discussion. Furthermore, they have e-mailed the council and mayor regarding their concerns. For many of the residents, this was their first experience with the City of San Jose since their neighborhood is being annexed.

I am a member of the General Plan 2040 Task force (GP2040). This makes me think of the best long-term uses of land citywide. In the past the council has made decisions based on the short-term rather then the long-term view. GP2040 is about learning from historical mistakes, being strategic with land use and planning our future.

The council spent over $100 million being strategic by «land banking» to provide development sites which have led to economic development. However, we also have the power to land bank without spending a dime … by simply voting no on projects that do not have the best long term interest for the City.

I believe that saying “just say no” to conversion of commercial/industrial land equals more land for jobs and a tax base to pay for neighborhood services.

The location is a gateway parcel on San Carlos between Sunol and McEvoy linking Downtown to Santana Row. The current proposal divides two other parcels (Sam’s Downtown Feed & Pizza Jacks) which does not allow for a development that is more focused on economic development. This odd shaped parcel does not allow for proper parking to be built out underneath since it divides two other properties. Otherwise the proposed parking is problematic for the neighborhood since it only provides 65 parking spaces for maximum occupancy of 234 people.

Shasta-Hanchett neighborhood board members have said, “If we are going to get a baseball stadium, wouldn’t this land would become more valuable?” I agree with them. This parcel should have an economic development aspect that could also have housing (affordable or market rate) on the top of significant retail by developing the entire parcel and not a divided one.

The current affordable housing proposal does not pay park fees or construction tax fees in a neighborhood that is identified as park deficient. We spoke about this deficiency Sept. 8 at the council study session for the Greenprint, and this rezoning would exacerbate the problem. San Jose has lost out on as much $60-90 million in park fees alone.

There is some concern about the concentration of affordable housing in this area. There is an affordable housing project right down street at the old Fiesta Lanes Bowl (another commercial-to-residential land conversion). 1,000 feet away we have eight stories of affordable housing on Bird and San Carlos and 300 feet from that another affordable project called Esperanza. A 100-percent affordable project on Lenzen, affordable senior housing next to MidTown Safeway. 400 feet the other direction 777 Park Ave. will be another 100 percent affordable project of 200 units. The Council just approved 42 affordable units on San Carlos and Meridian this Spring.

In December of this year, the Council will get another proposal on a mixed use project of 160 affordable units right across the street however that parcel is already zoned residential. Unlike the 1,500 additional housing units where housing was not planned, like DelMonte Cannery (600 units), Lou’s Village (100 units) and Sobrato office park (800 units).

Based on annexation zoning rules we can look at this parcel in two years when we know if there will be a future ballpark or not. Construction on this development was not going to occur for 2-3 years anyway so now is not the time to rezone. Due to the 2-3 year out construction schedule, there is no viable argument that this will spur construction jobs.

The proposed SRO would be in the vicinity of a proposed light rail station that other developers have given money towards; however, the VTA has not given a firm commitment to fund the station. (By the way, a light rail station does not need to be art, just give me an ADA compliant concrete slab and then in the future if we have the money we can do something fancy.)

I made a motion to deny the rezoning and was seconded by the mayor. The developer asked for another week to try and work with the adjacent property owners to make the project better. The council gave the developer a week to make it work. It’s not about the project; its about the loss of employment land and the loss of infrastructure fees for the City.

Saying no to bad proposals is cheaper then land banking with public funds.

Also posted in zoning | Comments closed

San Jose Greenprint in the Red

Since Sept. 7 was the Labor Day holiday, the City did not have a regular city council meeting. So, instead the Council had a “study session” on the Greenprint, which is a vision for our parks and community centers. (It is not a legal binding document.)

Study sessions are sort of like the “News Hour” program on PBS. We spend extra time on one topic where we get a presentation from city staff, and then we ask questions and make statements. Public comment is encouraged; the usual rule of two minutes; however, some community groups write letters in advance to be part of the public record.

The city has grown in square footage both in parks and community centers. However San Jose still ranks lower then many cities in its ratio of parks to people, even when you include school property (which is where I used to play as a kid). By 2020 we will be 1,124 acres short of our goal/vision. In fact, we exacerbate this ratio every week by approving affordable housing that is exempt from park fees or land dedication.

I brought this issue up a year ago at the Rules Committee. However I have been waiting for over a year now for the Housing Department to come back with some options for the Council. By my back-of-the-envelope calculations, San Jose has lost out on approximately $60-90 million in park fees from housing developers. Actually, this is another question I asked city staff: What is the amount of money the City of San Jose has lost on exempting fees/taxes for affordable housing? But I never heard back—probably since it is a big number.

With the passage of Measure P in the year 2000 with 78 percent voting yes, the city was able to build new community centers, remodel existing community centers and build out park amenities. For example Happy Hollow will open up next year brand new because of Measure P.

Measure P is financed by general obligation bonds. Without Measure P these improvements would be typically funded through the construction and conveyance tax, or if the park/community center was located in a redevelopment area, then possibly diverting RDA money meant for economic development. But without Measure P it is unlikely that much of what has been accomplished would have occurred.

The primary funding of new parks comes through building new housing, since market-rate housing (not affordable) pays park fees or donates land for a new park. So if you do not want any housing then you do not get new parks.

The question is: Would you be willing to vote yes on another Measure P to buy land and possibly construct new trails and parks?

A new Measure P may for example fund the entire completion of our proposed trail system and two new medium-sized parks. It would also provide money to be held in reserve to buy one or two school sites if and when a school district decides to close a school as has been done in the past. Actually we have two great facilities in the Willows Community Center and Kirk Community Center that used to be elementary schools.

Cities get the “first right of refusal” to buy other public-agency owned land. However, if one of these schools was for sale today, San Jose could not buy it because we don’t have the money, and it would likely become more housing.

One could counter and say that the way the city delivers park maintenance is too expensive and therefore we cannot provide the ongoing maintenance for existing facilities so lets not add new park acreage. Should a new Measure P be changed to a parcel tax so it provides money for ongoing maintenance that keeps up with the rate of wage-medical-pension inflation? Change the maintenance model? Or would you rather pay more in taxes for police or street paving than parks?

Here is a link to the Greenprint.

There is a public meeting to discuss this topic Wednesday, Sept. 16 at 6:30pm at City Hall in room W-120.

Also posted in Affordable Housing, Green Print, Parks | Comments closed

Water Today. Water Tomorrow?

San Jose’s population is officially 1,006,892!

1,006,892—confirmed by the State Department of Finance on April 30th of this year. I thought it would be interesting to share how San Jose has grown since 1950. Take a look:

1950 95,000 residents
1955 112,000 residents
1960 204,000 residents
1965 328,000 residents
1970 459,000 residents
1980 629,000 residents
1985 782,000 residents
1990 894,000 residents
2000 950,000 residents

The General Plan 2040 Task Force is discussing land use and how that plays a part with San Jose’s growth through 2040. There are members of the task force and interest groups that would like to see San Jose grow to a population of 1,500,000 by 2040. I do not share this opinion and feel 1,200,000 is a more sensible number. I blogged about this in the past, advocating for “stage gates” and/or triggers so that we get more jobs and not just more housing.

The General Plan Task Force Meetings are public. We generally meet the last Monday evening of the month through 2011. I encourage you to attend.
This link to the Planning Department’s General Plan update provides more information.

On Sept. 28, the General Plan Task force will be taking up the topic of water supply. In past blogs I have written about the importance of recycled water to our city.
This discussion on future water supply coincides with a documentary film that I am showing at the City Hall Council Chambers in partnership with the Sierra Club and the Santa Clara Valley Water District. The film is called FLOW, and I am showing it on Monday, Sept. 21 at 6:45pm. FLOW was also an Official Selection for the Sundance Film Festival, and Wired Magazine called it “the scariest film in the festival.”

Please RSVP with me if you would like to attend since seating is limited. Cost is free. Pierluigi.Oliverio@SanJoseCA.gov.

This is a link to FLOW’s two minute video trailer.

Also posted in General Plan, Water | Comments closed

Retirement Board Governance

Last week, I chose to attend both outreach meetings regarding the issue of retirement board governance, so I could hear concerns first- hand instead of reading a staff report. The possibility of changing the makeup of the current retirement board was presented by the consultant. The biggest change, if adopted, would be to remove city councilmembers from the board and add “independent” board members with a finance background.

Discussion about changing the amount of pension contributions or starting a second-tier retirement system for new employees was not part of the report. If you want to review the entire report by Cortex then go to this website.

Since 99.95 percent of city residents did not attend the meetings I thought I would share a synopsis of the comments that were made by attendees:

• Ken (City retiree and former retirement board trustee)
Status Quo is fine. Like none of the report

• Yolanda (union leader)
City employees have a stake in the pension, independent people would not.
Leave the the Councilmembers on the board. Why fix what is not broken. More outreach to city employees is needed. City is taking advantage of the recession. City wants to implement a two-tier retirement system.

• Jerry (SJ taxpayer)
Change pensions to 401K’s

• David (SJ taxpayer)
Thinks Council appointment of “independent” finance experts would be political and council would appoint union approved experts. The taxpayers are on the hook for pension fund losses. Cortex should have studied current board system.

• Steve (City retiree)
The report is a slap in the face. The City is stingy. Picking of Cortex was biased. There is no problem with current system.

• Brad (City retiree and 12-year trustee of retirement board)
Report is flawed. Only people that live in SJ should be on retirement board, currently not the case.
Council in the past appointed people the board that were Union favorites and not the most qualified.

• Carmine (City retiree and 13-year trustee of retirement board)
The current pension losses is not due to current governance model.
Council would appoint “independent” experts that serve their wishes and possibly not the employees.
How can we look to financial experts when many financial institutions have people in jail?

• Ben (union leader)
It would be bad policy to exclude elected councilmembers from the board. People with fiscal experience will not solve problems-not a cure all.

• Pete (City retiree)
Changing board will do nothing. No trust of financial experts. San Jose retirement plans should be a model of the nation. Yale lost 25 percent last year in pension fund and they are a Cortex client. Ontario teacher fund lost 18 percent last year and they are a Cortex client. You are awaking a sleeping giant of city workers that will go out and inform the public of the real story.

• Mary Sue (spouse of city retiree)
Feels that the “independent” experts represent city management and not the unions.
Unions should have a majority control of board not “independent” experts.
Life experience more valuable than education and expertise. City Councilmembers themselves are against us because they do not get retirement benefits.

• Rodney (SJ taxpayer)
No protection for taxpayer.

• Dan (union leader)
The board has done a wonderful job.
The theme is that there is a lack of trust. More outreach needed to Labor.

• Susan (SJ taxpayer)
Small business owners should be on retirement board. Investments should strive for safety and security and not be invested in risky assets. SJ needs pension reform. Taxpayers are not an ATM.

• Michael (city retiree)
I am a taxpayer too. City management is the problem.

• Naomi (spouse of city retiree)
This is not the time to make changes

• Bob (city retiree)
Suspicious of city management. Why hire a firm from Canada? Don’t trust people in suits.
Posting reports on website is no good-we want paper.

• Linda (union leader)
Concerned about the option of active employees electing a non active employee representative.

• Ashok (SJ axpayer)
Pensions are a structural problem.
Totally disappointed that SJ not considering true pension reform
Why should SJ residents have to pay for pension losses?

• Jeffrey (city employee)
This is a power grab by city management.

• Gail (spouse of city retiree)
Against any changes. People invested in the plan have a stake in the plan. Wrong time to make changes. Don’t trust the Council they make bad financial decisions like funding Mexican Heritage Plaza.

• Bill (union leader and former neutral retirement board trustee)
The reports touts “flexibility” but he does not see “flexibility” this is more of a concession.
Would give too much power to the Council

• Don (City retiree)
City management has been after our money for 30 years.Banker and attorneys are not experts.
We are not broke since we control it. We don’t need your expertise.

• Joyce (SJ taxpayer)
Mercury News is not favorable to business interests.
My 401K is a 201K. Add SJ taxpayers to retirement board.
Heads of Unions have conflicts of interest.

• Dorothy (city retiree)
All people should have guaranteed pensions. 401K’s bad.

• John (union attorney)
Likes removing veto power of council on board trustee nominations.
Prefer Florida model of pension boards which is 3 from employees, 3 from city/council and then 7th person is appointed by the 6 board members for a neutral member.

• Dave (city retiree)
Gave King Solomon analogy.
Mayors and Council will go but the benefits need to stay.
Bankers getting big bonuses. Something about selling Tulips in Holland.
Experts have nothing to bring to the table.

• Craig (SJ taxpayer)
Thank city employees for their work.
Former CFO. Nearly all companies have 401K’s. Pensions are the same as Social Security and are destined to go bankrupt. Why does not the city do a comprehensive pension overhaul. Taxpayers are the guarantee on pension losses.

• Walter (city employee)
Against report. No need to make changes.
Concern of removal of trustee and how super majority would work for pension fund investing in SJ projects.

• Bob (city retiree and president of retired employees, 2900 pensioners and 4600 with spouses/partners)
City councilmembers are good to have on boards. Board should stay the way it is.
Majority vote by non union trustees is not good. Next decade may have modest investment returns and if we pay “independent” experts that will raise the cost to administer the pension funds.

• Paul (city retiree)
I vote and pay taxes. Why fix what is not broken.
City management power grab that last 30 years. Leave it alone. Cortex is the low bid-it is a sham.
We want elected councilmembers on the board.

• Tony (city employee)
We do not have to support your proposal.

• Bobby (union leader)
City Management and staff lie. Police union only given two hours to give input.
Distrust of city manager over the years, lies. We are all taxpayers. Not broken-no trust.
City wrong in facts and makes financial mistakes.
Councilmembers on the retirement board safeguard the system. Want fairness

• Gay (union leader)
Concerned how budget will pay for “independent” financial experts.

• Eric (union leader)
Nothing broken. City Mgr trying to mess around with benefits. Do not agree with the report.

• Tim (city retiree and former retirement board trustee)
City management trying to control. We have experts already. I have a vested interest in pension and only people with vested interest should serve on the board. Companies like Apple and Intel get in trouble for options backdating. Unions need to be the majority on pension board.

• Tom (city retiree)
Not paid enough. Proposed governance model is a charade.
Mercury news is biased and not telling the whole story. It is my money.

• Mike (city employee)
Current systems is not broken. More experts will overkill board. Prop 162 split government from pension boards.

This topic will come to the Council in late September/early October.

Also posted in Retirement Board | Comments closed

Buyer Beware

One of the most important responsibilities a councilmember has is working on constituent issues. So far, my office has managed 4,675 constituent issues, which I refer to as “cases.” I set up a web database that allows constituents to track our case work in real time online.

In most cases we are successful in resolving the issue or concern. In other cases, constituents just want to share their comments on a particular matter. Some of the cases are comments on federal or state policy or other requests that are above and beyond what the city budget can provide, like, “please spend millions of dollars on a certain project” or “we want vintage street lights” when others streets do not even have street lights.

Recently, I had a request that came from a constituent who is a professional in the commercial real estate industry and is a veteran at purchasing property. He contacted my office a few months ago after purchasing a piece of property on Meridian Avenue. Unfortunately, this person did not contact the San Jose Planning Department before he bought the property to check how the property was zoned. He wanted me to tell the Planning Department to change the zoning to fit what he thought should be there instead of what the zoning has been for the past 30 years.

This request reminds me of the old adage: “buyer beware.” For example, someone may buy a home near a bar, school or church and then complain about the noise and parking. Well, it is the due diligence of the buyer to research the area, check zoning as well as any inspections a home or property may need. To choose to complain instead of taking responsibility for the purchase lacks credibility.

There are two things to remember when purchasing property; one, when you buy property, check out the zoning first so you know what you’re getting into—and if you do not like the zoning do not buy it. Second, if you buy a property and want to change the zoning, be prepared to invest time and money to do so, and figure that into the cost you pay for the property. Councilmembers cannot snap their fingers to change the zoning in the General Plan or at the whim of a real estate professional who thinks that their opinion should override the General Plan process.

I feel sorry for this person since he put himself into a predicament. However, blaming government for your own lack of due diligence is probably not going to help matters. In this particular case, I have met with the planning department and even asked the planning director to get involved to see how we might be able to help this person even though he is the one that did not take responsibility. The director is pursuing possibilities on how we might be able to help, but the real estate professional is still not pleased.

I remember from the private sector that sometimes there was the client who was never happy no matter how much you gave of yourself to help them, even when they made the mistake. So, in those cases sometimes you parted ways with the customer, since mutual respect was absent. Sometimes working on constituent issues is like working with private-sector clients, and we try to help, but have to admit that we cannot please everyone every time.

Also posted in City Council, zoning | Comments closed

Recruiting Vigilantes

The first council meeting of the new fiscal year will result in discussing the new budgets cuts that must be made due to Sacramento’s raid of cities’ property tax money. Since San Jose does not want to look at delivering services differently, as Chicago and other cities do, then that leaves us with only one option: cut services to San Jose residents.

For example, my office receives calls and emails on a variety of topics, including street paving, park maintenance, blight and so on. However, there is one thing that almost all people comment about. I agree, this thing is totally out of control. You see it all around San Jose when you traverse its roadways at and stop at every intersection. Sometimes these things are over five feet tall, and they grow bigger by the day.
They come in different colors and varieties and are as attractive as a broken window that never gets fixed.

Well, if you haven’t guessed what this “thing» is yet, its weeds. The subject of weed abatement is so taboo that we would rather have the city look terrible then outsource a simple task of removing weeds. Well, ladies and gentleman, I can tell you that if you call any of your councilmembers to complain about a certain city-owned space being ravaged by tall weeds, that the response time will be really long…really long.

Also in case you weren’t aware, the City of San Jose ripped out nice looking plants in medians throughout the city because the City cannot afford to maintain the plants. Yep, remove the beautiful plants that were paid for by your dollars to let weeds grow in abundance. Welcome to San Jose! Not the type of neighborhood marquee I advocate.

However, I am calling on and recruiting Vigilantes, specifically Weed Vigilantes. If you see a forest of weeds in San Jose, I say do not hold back—tackle it head on and pull them out. Maybe even carry shears or a lopper and cut them down. I know that some of you are wondering if you need a permit to remove weeds since some of them are so big people may think they are trees. I say don’t worry about a permit—you are doing your neighbors and city a favor. Consider yourself deputized. As far as cleaning up, that would be great but if not, just leave them as your calling card as an example to others weeds not to mess around.
San Jose: a place where you pay higher city taxes, pick your own weeds and fund multi-million dollar golf courses. Priceless.

Posted in Politics | Comments closed

The State’s Ginsu Knife

Do you remember the commercial for Ginsu Knives from the late ‘70s? It would show a sharp knife on TV cutting through everything from tomatoes to tin cans. The announcer would repeatedly say: “But wait! There’s more!”

Well, just when you thought we had a balanced budget for the City of San Jose, the state of California has said “But wait! There’s more!” The state’s own Ginsu Knife just slashed our gaunt budget’s belly. The newly passed state budget will hurt the cities and counties. As much as local municipalities think they are independent from the state, this budget should serve as a wake up call and reminder that the state can take from us without permission.

Counties and cities are not Sacramento’s primary constituents; they have other interest groups that apply more pressure.

As a result of the state’s recent action, San Jose will lose property tax revenues of more than $20 million out of the general fund—which is equivalent to operating all the neighborhood libraries citywide. This will equate to fewer services from the city as there will be fewer city employees providing some type of service, whether it be code enforcement or neighborhood watch, etc.

$74.8 million will be taken from the Redevelopment Agency (RDA) (However, the $40 million of RDA money for affordable housing was not touched by the State, since Sacramento wants San Jose to continue building more affordable housing). Headline projects like the Convention Center expansion, proposed baseball stadium, locating clean tech jobs in San Jose and Strong Neighborhood Initiative projects will be thrown into a casket.

In looking for a lemonade-out-of-lemons solution, I thought maybe we could just make a quick $74.8 million lump sum payment on the outstanding RDA bonds and dodge the state, since there would be no money, and we would at least have less debt down the road. Not an option. The state would force RDA to borrow the money to pay the state or make the City of San Jose liable.

However, there is one option that might allow for projects to go forward. RDA is one of the only tools cities have for economic development which provides genuine stimulus to the economy with construction jobs, and, more importantly, future revenues to the city. The state this year would allow RDA to borrow money from the $40 million affordable housing funds as long they were paid back by 2015. This would simply require a majority vote of the city council.

If San Jose would do this then it would allow for economic development that could bring long-term revenues to the city of San Jose.

It is time for the Council to prioritize what is most important in 2009 and moving forward. The choices are more affordable housing during a time of current housing affordability in both rental and for ownership housing OR economic development that could build the tax base of our city to pay for city services like public safety and libraries. This would mean less affordable housing units built this year; however keep in mind San Jose has been the number one provider of affordable housing in the state of California.

Affordable housing does not pay park fees or fees to pave streets and in many cases does not even pay property taxes for ongoing city services. So it’s a net loss on the balance sheet.

What would you choose, more affordable housing or economic development? Do you think it’s time that voters started voting on how much affordable housing is built in San Jose?

On a separate topic: Last week, I was asked why I did not sign the Police Union pledge. I do not sign pledges for interest groups, period. I believe signing pledges can be problematic. For example, many of our state legislators signed pledges to never raise taxes. However, we have a state that is mostly dependent on personal income tax and capital gains tax to pay for services, so a recession can hurt the budget quickly. So maybe during times like this it is prudent to cut spending but also to reinstate the vehicle license fee or raise the tax on gasoline while dropping taxes on personal income.

It might be any number of scenarios; however, signing a pledge can get in the way of doing the right thing at the right time. As far as my support for public safety, I have two years of votes, two years of public statements, 121 City Hall Diary blogs on SanJoseInside.com, and a public safety page on the District 6 website that San Jose residents and the police union can view to ascertain the level of my support.

Also posted in Uncategorized | Comments closed

Politics in the Age of the iPod

I was recently downloading classic songs on my iTunes from the late ‘70s, two of which were Bob Welch’s “Ebony Eyes,” and Player’s “Baby Come Back.” iTunes is great because I can choose the specific songs I like rather than having to purchase the entire album.

Those of us who are a certain age probably remember when we had to buy the whole record/cassette/8-track to listen to that one song we really liked. In fact, back in the day, when these gadgets were the only ways music was shared, there was the “A” side and “B” side—with the A side home to the selections that were thought to be the top hits. So we took the good songs with the bad; we did not have the luxury of picking and choosing what we liked and did not like.

While downloading my songs, I was thinking about how we choose our politicians. Unfortunately, we don’t get to pick politicians the way we do music, although I bet most of us would like to. It would be great to choose the top characteristics of the best candidates in a race and then take those skill sets and create our own perfect politician. However, when it comes to picking our elected officials, we are forced to do it the old fashioned way, we elect the whole package—we must purchase the whole album and then concentrate on the good parts.

Interestingly enough, however, sometimes the B side of an album produced the top hits, to everyone’s surprise. Likewise, sometimes when we vote for candidates, their qualities that weren’t considered great may turn out to become the things we like most about them. Conversely, we may have thought that the one song we bought the whole album for was awesome, but then, after purchasing the album, that one song soon gets on our nerves and we are left wondering what we liked about it in the first place.

At least when we bought an entire album, we knew what we were getting…its not like the album changed it’s tune after we purchased it…unlike some elected officials do once they are elected.

We live in a world where we have many choices. We get to choose what we really like in most things and leave the rest. However, at the same time, we have to remind ourselves to balance the freedom to choose when it comes to judging elected officials. Do we expect too much from elected officials or do elected officials describe themselves unrealistically to lead us believe they can do miracles? Or both?

Have you been let down when the politician you wanted to win didn’t, only to be pleasantly surprised with the person who did win? Have you supported a politician who won, only to be let down?
On another note, last week on this blog it was asked: Do San Jose City Council members get benefits when they retire? The short answer is: No. After serving eight years (two four-year terms maximum) council members are not eligible for lifetime medical. Councilmembers are allowed to put a portion of their paycheck into a 457 plan, which is like a 401K or 403B plan. They get to keep this when they leave, much like anyone else in the private sector does when switching jobs.

However, members of the County Board of Supervisors do receive lifetime medical once they finish their 12 years (three four year terms maximum) and make approximately $50K more than San Jose city council members. Members of Congress also receive lifetime medical. I do not know about our state legislature.

Posted in Politics | Comments closed

Consent Calendar

The consent calendar on the city council agenda comes after the City’s ceremonial items are completed. The difference between “consent” items and the rest of the agenda is that the consent items are suppose to be composed of “rubber stamp” issues like excused absences for councilmembers, final adoption of ordinances that were already voted on at previous council meetings, etc. As a result, all the consent items are voted on at once. However, any councilmember or member of the public has the right to “pull” an item from the consent calendar which requires that the item be voted on separately than the rest.

The rule of thumb is that the consent calendar is not supposed to include any in-depth policy or controversial issues. However, sometimes buried in the consent calendar are items that merit discussion. For example, I removed the $2.26 million golf nets for Los Lagos golf course a year ago. I thought that $2.26 million on golf nets warranted discussion and I wanted to be on record for not supporting this purchase.

At last week’s council meeting, we had several items that probably should not have been on the consent calendar. One item of interest was settling a lawsuit with a software vendor for our Housing Department. Unfortunately, the Housing Department bought software based on a promise and a PowerPoint slide. So when it came to actually implementing the software, it did not work. As a result, we spent eight years of staff time going back and forth on a settlement. We are getting only a fraction of our money back via installments over five years.

As you may remember, I have been a fan of piloting software before purchasing it. I believe it is a smarter and smoother way to go. If the software does not work, you find out quickly and do not have to spend a lot of money or staff time. The city of San Jose now has a new policy that allows for technology pilots. Here is a link to a prior blog on this topic.

Another consent item was that the council decided to give every janitor, gardener and security guard a raise at the water pollution control plant last week. I removed this item and shared my concerns which included the idea that if we receive good services today, why should we pay more? Perhaps we would consider giving raises in a robust economy to attract workers, but we are in a recession with the highest unemployment rate in Santa Clara county since 1941. We do not have a problem getting these services delivered today. I am not sure why we continue to voluntarily raise the cost of government when we do not have to do so. I also found it interesting that this issue came forward two weeks after council raised the sewer fees and not before.

And, yet another item on consent was the public-private partnership update. As you may know, there are property management groups from homeowner associations to corporate property owners who would like to maintain certain city parks for free! They would take care of landscaping, cleanliness, etc., by hiring professionals in those fields. Most people that I have talked with think it’s great, because then, I can free up currently deployed city park staff and move them to other parks in San Jose and catch up on the backlog of maintenance. Ah … but not so fast, thee who is on a quest for government efficiency … the council policy requires that these private landscapers be paid a prevailing wage, which is higher then the market price. Therefore, our quagmire continues since private groups do not want to pay above- market rates.

Your government at work…sure…but does it have its residents’ best interest in mind?

If you’re looking for food, entertainment and a tax deduction, then consider attending Monday Night Live at the San Jose Stage Company tonight at 6:30. Tickets are $60.

Also posted in Uncategorized | Comments closed

Take Action!
Whole Foods Grand Opening
Connect
Three Creeks Trail Discussion
Connect on Facebook
Search the Blogs!

Note: This is Pierluigi Oliverio’s 300th Post:

Take Action!

Whole Foods Grand Opening

Connect

Three Creeks Trail Discussion

Connect on Facebook

Search the Blogs!