Councilmember Souza running for reelection; Pledges to Balance the City Budget

By David GreenwaldMarch 23, 200748 comments
The Davis Enterprise reported on Thursday that Davis City Councilmember Stephen Souza announced his bid for re-election to the City Council.

What I find interesting aside from again the sheer earliness of a reelection bid are goals if reelected.

“I would like to see an urban transition zone. I would like to move toward reducing our global footprint, provide police and fire with the tools they need to keep us safe, and balance our budget completely.”

Leaving aside the inconsistency between reducing our global footprint and big box development such as Target, the idea of balancing our budget completely should draw question and scrutiny given the record of Mr. Souza and his council majority cohorts in this regard.

One might rightly ask, and it is probably true that at an announcement is perhaps not the time to do so, what Mr. Souza has done to balance the budget in his first three years on the council?

If anything, as we discussed last week, Mr. Souza has contributed to the spiraling structural fiscal problems of the city of Davis by failing to act on the runaway pension problem.

As we reported last week, the city has been extremely generous with retirement benefits and after just five years of city service, a city employee is entitled to lifelong retirement benefits. If allowed to continue this will simply suck up all of the resources of the city. Moreover, the city is becoming increasingly hamstrung by upper management salaries. The combination is likely to mean fewer services and higher taxes down the line.

And yet, as recently as Mid-March, Souza continued to approve such measures that extend those benefits.

Furthermore as the Davis Enterprise reported on March 14, 2007: City leaders, led by you guessed it, Stephen Souza, have proposed “building, equipping and staffing a fourth fire station, something that would cost $5.2 million to get off the ground and $1.7 million per year to operate.”

This feeds right into Mr. Souza’s goal of providing fire with more tools to keep us safe, but again, is something that the city does not have money for.

On March 13, 2007, the city had serious talks about their financial future. Finance Director Paul Navazio painted a bleak picture:

“At current funding levels, projections show streets will continue to deteriorate over time,” said Finance Director Paul Navazio.

The city budget is a delicate thing, depending on just a few revenue streams. The bulk of the revenue comes from property tax and sales tax, and half of that sales tax comes from car sales, Navazio said.

The City Council has made efforts to diversify the city’s sales tax base by approving retail developments such as Target and Interland, but those projects have yet to be built and yet to start producing revenue.

But even that revenue could be diminished if a half-cent sales tax that voters approved in 2004 isn’t reinstated in 2010, leaving the budget with a $3.2 million hole.

A parks tax, renewed by voters last year, will expire in 2012, taking $1.3 million in revenue with it if it is not renewed again.

The answer to the funding problem: you guessed it, new and more taxes.

“The answer could be a new and different tax with clear information about what it funds. Both the sales tax and the parks tax go into the general fund and can be used for any number of things.”

What the discussion did not talk about is that a lot of the revenue problems and short-falls are being driven in part by structural spending problems created by locked in salaries and benefits that have been set at too high a level with little or no flexibility.

It is nice to talk about balancing the budget, but we need an honest discussion about how we got to where we are now and what it will take to balance the budget. That will require an explanation of why increasingly large amounts of city spending is going towards the payment of high ranking city officials and those who will have to pay the brunt of it will be the taxpayers and the heaviest burden will fall on new home owners and others who can least afford to pay that burden.

It is nice that Mr. Souza is now talking about a balanced budget because he has contributed as much as anyone to the runaway structural fiscal problems that this city has faced.

In fact, perhaps the most responsible councilmember in this regard has been Mayor Sue Greenwald who has voted against numerous pay increases, pension increases, and who has been warning us for years now of an impending crisis as the city council continues to lock up more and more future revenue into these expensive contracts that go heavily and increasingly toward wealthy, top-end personnel. As Mayor Greenwald said at a recent meeting, if the contract was merely going to rank-and-file, she would have no problem with it, but going to upper management, she could not in good conscience support it.

At some point we need to have an honest discussion of the city’s fiscal situation, unfortunately many of us have little faith that the current news media in this city would understand the problems enough to hold the public official’s feet to the fire.

In the meantime, Souza is running for re-election along with colleague Don Saylor. The question now is who will run against them. We will be watching closely as this develops.

—Doug Paul Davis reporting

Author

  • David Greenwald

    Greenwald is the founder, editor, and executive director of the Davis Vanguard. He founded the Vanguard in 2006. David Greenwald moved to Davis in 1996 to attend Graduate School at UC Davis in Political Science. He lives in South Davis with his wife Cecilia Escamilla Greenwald and three children.

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Elections

48 comments

  1. I think it goes something like
    “fool me once, shame on you, fool me twice, shame on me” Davis voters are too savy to buy this line again. It will take more than just using the Davis bicyle logo this time. Campaign rhetoric cannot alter Souza’s voting record and stated positions from the council dais.

  2. I think it goes something like
    “fool me once, shame on you, fool me twice, shame on me” Davis voters are too savy to buy this line again. It will take more than just using the Davis bicyle logo this time. Campaign rhetoric cannot alter Souza’s voting record and stated positions from the council dais.

  3. I think it goes something like
    “fool me once, shame on you, fool me twice, shame on me” Davis voters are too savy to buy this line again. It will take more than just using the Davis bicyle logo this time. Campaign rhetoric cannot alter Souza’s voting record and stated positions from the council dais.

  4. I think it goes something like
    “fool me once, shame on you, fool me twice, shame on me” Davis voters are too savy to buy this line again. It will take more than just using the Davis bicyle logo this time. Campaign rhetoric cannot alter Souza’s voting record and stated positions from the council dais.

  9. Am I wrong to remember that the current council itself elected Sue Greenwald mayor and Ruth Asmundson the mayor pro tem? That is, I thought we got rid of the rule that automatically awarded these positions to the first past the post.

  10. Am I wrong to remember that the current council itself elected Sue Greenwald mayor and Ruth Asmundson the mayor pro tem? That is, I thought we got rid of the rule that automatically awarded these positions to the first past the post.

  11. Am I wrong to remember that the current council itself elected Sue Greenwald mayor and Ruth Asmundson the mayor pro tem? That is, I thought we got rid of the rule that automatically awarded these positions to the first past the post.

  12. Am I wrong to remember that the current council itself elected Sue Greenwald mayor and Ruth Asmundson the mayor pro tem? That is, I thought we got rid of the rule that automatically awarded these positions to the first past the post.

  13. Note to Stephen Souza:
    There’s plenty of time, but it would be very useful if you would describe in some detail how you propose dealing with the city’s budget issues. There are only a couple of choices:
    –cut expenses; if so, what and how?
    –raise the sales tax; do you advocate that?
    –increase sales tax revenues; do you propose further retail development? If so, what, where, and when?

    Don S

  14. Note to Stephen Souza:
    There’s plenty of time, but it would be very useful if you would describe in some detail how you propose dealing with the city’s budget issues. There are only a couple of choices:
    –cut expenses; if so, what and how?
    –raise the sales tax; do you advocate that?
    –increase sales tax revenues; do you propose further retail development? If so, what, where, and when?

    Don S

  15. Note to Stephen Souza:
    There’s plenty of time, but it would be very useful if you would describe in some detail how you propose dealing with the city’s budget issues. There are only a couple of choices:
    –cut expenses; if so, what and how?
    –raise the sales tax; do you advocate that?
    –increase sales tax revenues; do you propose further retail development? If so, what, where, and when?

    Don S

  16. Note to Stephen Souza:
    There’s plenty of time, but it would be very useful if you would describe in some detail how you propose dealing with the city’s budget issues. There are only a couple of choices:
    –cut expenses; if so, what and how?
    –raise the sales tax; do you advocate that?
    –increase sales tax revenues; do you propose further retail development? If so, what, where, and when?

    Don S

  17. “If anything, as we discussed last week, Mr. Souza has contributed to the spiraling structural fiscal problems of the city of Davis by failing to act on the runaway pension problem.”

    To be clear, the problems I wrote about in my column were about unfunded retirement medical benefits, not about pensions. In fact, all of the pensions for city workers are funded.

    What I did not get into in my column is a very strange practice of the City of Davis when it comes to funding pensions for CalPERS: the City pays 100% of the pension funding for all of its non-police and non-fire personnel.

    For most public employees, this is a shared cost. According to the PERS formula, the agency should pay 9.25% of payroll into the PERS fund and the employees should be charged 7.00%. However, that is not how it works in Davis. The total bill (this year) for pension funding is $2.81 million. The employee share should be $1.2 million. However, the employees in Davis do not pay their share. The City Council decided some time ago to make this an added benefit, and it thus picks up the bill each year.

    For safety personnel, the formula is 21.11% for the city and 9.00% for the employees. In Davis, the cops and firefighters are charged the 9.00% for their pensions. However, I believe in exchange for that, they have received much higher salaries. I know, for example, that department heads and top lieutenants in fire and police make more than their non-safety counterparts; and I believe that is a function of the safety personnel contributing to their retirement accounts.

  18. “If anything, as we discussed last week, Mr. Souza has contributed to the spiraling structural fiscal problems of the city of Davis by failing to act on the runaway pension problem.”

    To be clear, the problems I wrote about in my column were about unfunded retirement medical benefits, not about pensions. In fact, all of the pensions for city workers are funded.

    What I did not get into in my column is a very strange practice of the City of Davis when it comes to funding pensions for CalPERS: the City pays 100% of the pension funding for all of its non-police and non-fire personnel.

    For most public employees, this is a shared cost. According to the PERS formula, the agency should pay 9.25% of payroll into the PERS fund and the employees should be charged 7.00%. However, that is not how it works in Davis. The total bill (this year) for pension funding is $2.81 million. The employee share should be $1.2 million. However, the employees in Davis do not pay their share. The City Council decided some time ago to make this an added benefit, and it thus picks up the bill each year.

    For safety personnel, the formula is 21.11% for the city and 9.00% for the employees. In Davis, the cops and firefighters are charged the 9.00% for their pensions. However, I believe in exchange for that, they have received much higher salaries. I know, for example, that department heads and top lieutenants in fire and police make more than their non-safety counterparts; and I believe that is a function of the safety personnel contributing to their retirement accounts.

  19. “If anything, as we discussed last week, Mr. Souza has contributed to the spiraling structural fiscal problems of the city of Davis by failing to act on the runaway pension problem.”

    To be clear, the problems I wrote about in my column were about unfunded retirement medical benefits, not about pensions. In fact, all of the pensions for city workers are funded.

    What I did not get into in my column is a very strange practice of the City of Davis when it comes to funding pensions for CalPERS: the City pays 100% of the pension funding for all of its non-police and non-fire personnel.

    For most public employees, this is a shared cost. According to the PERS formula, the agency should pay 9.25% of payroll into the PERS fund and the employees should be charged 7.00%. However, that is not how it works in Davis. The total bill (this year) for pension funding is $2.81 million. The employee share should be $1.2 million. However, the employees in Davis do not pay their share. The City Council decided some time ago to make this an added benefit, and it thus picks up the bill each year.

    For safety personnel, the formula is 21.11% for the city and 9.00% for the employees. In Davis, the cops and firefighters are charged the 9.00% for their pensions. However, I believe in exchange for that, they have received much higher salaries. I know, for example, that department heads and top lieutenants in fire and police make more than their non-safety counterparts; and I believe that is a function of the safety personnel contributing to their retirement accounts.

  20. “If anything, as we discussed last week, Mr. Souza has contributed to the spiraling structural fiscal problems of the city of Davis by failing to act on the runaway pension problem.”

    To be clear, the problems I wrote about in my column were about unfunded retirement medical benefits, not about pensions. In fact, all of the pensions for city workers are funded.

    What I did not get into in my column is a very strange practice of the City of Davis when it comes to funding pensions for CalPERS: the City pays 100% of the pension funding for all of its non-police and non-fire personnel.

    For most public employees, this is a shared cost. According to the PERS formula, the agency should pay 9.25% of payroll into the PERS fund and the employees should be charged 7.00%. However, that is not how it works in Davis. The total bill (this year) for pension funding is $2.81 million. The employee share should be $1.2 million. However, the employees in Davis do not pay their share. The City Council decided some time ago to make this an added benefit, and it thus picks up the bill each year.

    For safety personnel, the formula is 21.11% for the city and 9.00% for the employees. In Davis, the cops and firefighters are charged the 9.00% for their pensions. However, I believe in exchange for that, they have received much higher salaries. I know, for example, that department heads and top lieutenants in fire and police make more than their non-safety counterparts; and I believe that is a function of the safety personnel contributing to their retirement accounts.

  25. Don- You left out councilman Souza’s first choice to deal with budget deficits, namely peripheral development agreement packages to back-fill budget deficits while increasing future deficits to be dealt with by still more peripheral development,etc. etc. This “Ponzi scheme” is the engine of peripheral sprawl. There is reportedly a website available with Souza’s contributor list that includes just about every developer in the region.

  26. Don- You left out councilman Souza’s first choice to deal with budget deficits, namely peripheral development agreement packages to back-fill budget deficits while increasing future deficits to be dealt with by still more peripheral development,etc. etc. This “Ponzi scheme” is the engine of peripheral sprawl. There is reportedly a website available with Souza’s contributor list that includes just about every developer in the region.

  27. Don- You left out councilman Souza’s first choice to deal with budget deficits, namely peripheral development agreement packages to back-fill budget deficits while increasing future deficits to be dealt with by still more peripheral development,etc. etc. This “Ponzi scheme” is the engine of peripheral sprawl. There is reportedly a website available with Souza’s contributor list that includes just about every developer in the region.

  28. Don- You left out councilman Souza’s first choice to deal with budget deficits, namely peripheral development agreement packages to back-fill budget deficits while increasing future deficits to be dealt with by still more peripheral development,etc. etc. This “Ponzi scheme” is the engine of peripheral sprawl. There is reportedly a website available with Souza’s contributor list that includes just about every developer in the region.

  33. i think what we really need is to become a charter city, so that we can look at other ways to raise revenue than just relying onn development and sales tax.

    i am rather surprised to see self-defined progressives – whatever that wortd means in any given political context, it’s rather slippery – basing a political argument on antitax rhetoric, though. the thing that makes this city unliveable for many people isn’t the tax levels, it’s the cost of housing and/or rent. noone’s being taxed out of the city, that isn’t already in trouble because of rising gas/food/insurance/rent costs.

    repealing prop. 13 would be nice, but i don’t expect that’ll happen anytime soon. pity, it’s the root of all this shell-game local financing.

  34. i think what we really need is to become a charter city, so that we can look at other ways to raise revenue than just relying onn development and sales tax.

    i am rather surprised to see self-defined progressives – whatever that wortd means in any given political context, it’s rather slippery – basing a political argument on antitax rhetoric, though. the thing that makes this city unliveable for many people isn’t the tax levels, it’s the cost of housing and/or rent. noone’s being taxed out of the city, that isn’t already in trouble because of rising gas/food/insurance/rent costs.

    repealing prop. 13 would be nice, but i don’t expect that’ll happen anytime soon. pity, it’s the root of all this shell-game local financing.

  35. i think what we really need is to become a charter city, so that we can look at other ways to raise revenue than just relying onn development and sales tax.

    i am rather surprised to see self-defined progressives – whatever that wortd means in any given political context, it’s rather slippery – basing a political argument on antitax rhetoric, though. the thing that makes this city unliveable for many people isn’t the tax levels, it’s the cost of housing and/or rent. noone’s being taxed out of the city, that isn’t already in trouble because of rising gas/food/insurance/rent costs.

    repealing prop. 13 would be nice, but i don’t expect that’ll happen anytime soon. pity, it’s the root of all this shell-game local financing.

  36. i think what we really need is to become a charter city, so that we can look at other ways to raise revenue than just relying onn development and sales tax.

    i am rather surprised to see self-defined progressives – whatever that wortd means in any given political context, it’s rather slippery – basing a political argument on antitax rhetoric, though. the thing that makes this city unliveable for many people isn’t the tax levels, it’s the cost of housing and/or rent. noone’s being taxed out of the city, that isn’t already in trouble because of rising gas/food/insurance/rent costs.

    repealing prop. 13 would be nice, but i don’t expect that’ll happen anytime soon. pity, it’s the root of all this shell-game local financing.

  41. Interesting party evite list. Safe to say who is on what side of the fence with those loyalties. I think I’ll fill out my absentee ballot right now.

  42. Interesting party evite list. Safe to say who is on what side of the fence with those loyalties. I think I’ll fill out my absentee ballot right now.

  43. Interesting party evite list. Safe to say who is on what side of the fence with those loyalties. I think I’ll fill out my absentee ballot right now.

  44. Interesting party evite list. Safe to say who is on what side of the fence with those loyalties. I think I’ll fill out my absentee ballot right now.

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