Sacramento Is What's Wrong

Katy Grimes: When analyzing the issues of the cities and counties in this state, the city of Sacramento stands out as a textbook example of what not to do, and what’s wrong with local government.

Our current city council is one-party rule (guess which party), and has been for decades. The last city council had one Republican representative, who was impotent to block any bad policy votes.

Sacramento City Council has been a springboard for many of the regions’ politicians, including many members of the Assembly and Senators: Sen. Darrell Steinberg, Insurance Commissioner Dave Jones (former Assemblyman), former Assemblywoman and Senator Deborah Ortiz, former Assemblyman Phil Isenberg, former Assemblyman Lloyd Connelly, and even the late Congressman Bob Matsui – all Democrats.

Several of the recent council have run unsuccessfully for state legislative offices including former Councilwoman Lauren Hammond, and current Councilman Kevin McCarty.

Former Councilwoman Kim Mueller is now a Federal District Judge, and Connelly is a Superior Court Judge.

Obviously local government is where politicians get their feet wet, and it stands to reason they get solid experience – at what, is open to debate.

However, Sacramento’s council has in the past two decades, expanded exponentially, and most notably under the strange leadership of former Mayor Heather Fargo.

Fargo served on city council from 1989 until she ran for Mayor in 2000, and then served two terms as Mayor until she was defeated after running for a third term, by Kevin Johnson.

Under Fargo’s two Mayoral terms, city government expanded dramatically, as many services were moved from the private sector to the city, increasing the size of and the city’s pension obligation. Fargo’s reign also included salary, pension and benefit increases to the City’s union employees.

Currently, the city of Sacramento claims to be facing a $39 million deficit in its general fund for the 2011-12 fiscal year, but several city management-level employees, who requested anonymity, say that the deficit is actually closer to $60 million, and there is talk within the city that Sacramento’s reserve will soon be down to a record low of $1 million.

And typical of political decisions, Sacramento keeps on threatening and then implementing cuts to police officers, fire fighters, park employees, and has cut back on park maintenance and garbage pickups – always the most public of services, in an attempt to force the residents to agree that tax increases are the only answer.

Local media has blamed the “loss of revenue” (tax income) on declining property taxes due to plummeting property values and mass foreclosures. However, property owners not in foreclosure have been charged property tax on the old higher home and commercial property values. Sacramento County property tax appeals take up to two years to complete, and the property owner is required to pay the old assessed value in the meantime.

And, the other big budget deficit factor is pensions: “The city will have to increase its contribution into the CalPERS system this year to make up for investment losses sustained by the retirement fund. And with so many city employees retiring, City Hall’s contribution to retiree medical benefits will rise by $500,000,” the Sacramento Bee reported recently.

Sacramento’s current city council is now faced with a responsibility that was inevitable, and several old council members have been complicit in creating the problem – they are going to have to address the absurdly high salaries, benefits and pensions, as well as redundant city government positions and services. They can no longer put it off.

Sacramento’s Mayor Kevin Johnson has a golden opportunity right now to be the first Mayor in years to do something lasting and positive for Sacramento’s long-range financial health.

Even though Johnson is only one vote on the council, he has demonstrated leadership skills during the recent Sacramento Kings crisis, as well as management of the dysfunctional Maloof family, the owners of the NBA team, the Sacramento Kings.

Now hopefully, Johnson can start working on improving Sacramento’s nasty reputation for being unfriendly to business (the reputation is well-deserved), and start talks with local unions on pension, salary and benefit concessions.

A total city meltdown would be bad for business (putting it mildly). And while several of the city council members deserve to be publicly flogged for their complicity in the crisis (along with Fargo), Johnson and the new council members can and should stop the special interest decision making, end the personal enrichments and force concessions across the board in order to get Sacramento into a leadership position in the state, and back on track financially.

It’s an embarrassment that Sacramento has been such a hotbed of self-serving political leeches over the decades, who have sacrificed the city’s long-range development for their own political aggrandizement.

Johnson has a one-shot chance right now to accomplish two things – he can facilitate saving Sacramento, and capitalize on it politically, should he do the right thing.

Negotiating pensions and benefits is not politically sexy, and political advisors shy away from this tactic, especially in the age of union dominance in politics. But saving Sacramento jobs, businesses, homes, parks, and streamlining city employees, police and fire would be a boost to everyone in the region, and could cause other cities in the state to take notice.

Is this just a dream?

JUNE 6, 2011