The economy is doing well and tax revenues are rising – so why are three of San Diego’s largest government agencies facing massive hits to their bottom lines?
The city of San Diego estimates it must slash $47 million to $67 million in spending, San Diego County may have to cope with $100 million in new costs and San Diego Unified is staring down at least $124 million in cuts – an especially dire challenge because the reserve fund has nothing to spare.
Blue Model BluesPension Costs Batter Southern California
The fiscal situation is darkening for local governments in Southern California even as the economy booms. Voice of San Diego reports:
It won’t surprise regular Via Meadia readers that spiraling pension costs are the main problem. San Diego County is facing a half a billion per year in costs for pensions and pension bonds, and the city of San Diego is looking at huge pension cost increase as CalPERS cuts its projected rate of return after falling short year after year.
If relatively well-managed local government entities in a prosperous region in a wealthy state during an economic expansion face problems like these… well, let’s hope President Trump pulls some economic rabbits out of the hat or we’ll all (blue cities and blue states more than most) be in a world of trouble.