City faces $50 million deficit

Mayor Julián Castro Mayor Julián Castro Photo: Darren Abate/Special To The Express-News Photo: Darren Abate/Special To The Express-News Image 1 of / 1 Caption Close City faces $50 million deficit 1 / 1 Back to Gallery

Bracing for an estimated $50 million shortfall, the City Council worked Tuesday on building a consensus on what it would be willing to fund and what to slash in the upcoming budget process.

The city also is out of debt capacity — at least for the time being — and could issue more bonds only through a property tax increase; the likelihood of that is slim.

The council gave policy guidance to City Manager Sheryl Sculley and her budget staff during an all-day meeting before starting its summer break.

Council members won't meet again as a body until August.

Among their suggestions were a hodgepodge of budget cuts, from $32 million for streetcars to an unspecified amount for so-called “delegate” agencies — nonprofits, at least partly funded through taxpayer dollars, that provide social services.

District 10 Councilman Carlton Soules didn't take long to suggest that the $32 million in certificates of obligation — bonds that don't require voter approval — that have been set aside for the city's contribution to the controversial streetcar project be redirected to capital projects, such as badly needed deferred maintenance.

Soules' suggestion didn't seem to get much traction among his colleagues, and during a break Mayor Julián Castro said he didn't believe the proposal would make the cut.

“That's already been funded as a multi-entity effort,” Castro said. “I'm confident that that's a decision that's already been made.”

While the decision to fund streetcars has been made, the certificates haven't actually been sold, Soules says.

He's targeting the funds in part because the city has capital-investment needs, such as deferred maintenance on city facilities and other infrastructure projects that typically would be funded through certificates of obligation. It's also no secret that Soules isn't a fan of streetcars.

“We're pretty much capped on our capital spending,” Soules said. “I think we need to relook at certain things that we've allocated money towards but not spent.”

While there didn't seem to be much support for his suggestion, there was general agreement among council members to take a hard look at the city's delegate agencies, especially those that aren't meeting performance goals or aren't focused on the city's priorities.

And Councilwoman Elisa Chan suggested cutting the budget for Capital Improvements Management Services, the department that oversees bond and other capital projects. Initially, she suggested slashing its budget by 30 percent but then increased that to 5o percent.

The mayor suggested cutting the council's budget for things such as personnel and travel and asked city staffers to look into how the purchasing department could get better deals on goods.

Council members generally agreed to consider fee increases in the fiscal 2014 budget, which takes effect Oct. 1, but few were willing to discuss a property-tax increase, which was identified as one of three scenarios by which the city could balance the budget.

Newly minted Councilwoman Shirley Gonzales put to rest persistent whispers that she's a closeted member of the Republican Party.

Early in the day, when members were tossing around their priorities in a goal-setting session, she mentioned a desire to increase the use of “alternative transportation” in San Antonio. And in the afternoon, Gonzales was the only council member to support a scenario that included a 1-cent increase in the city's property tax rate.

After the meeting, she and consultant Choco Meza underscored the thrust of the councilwoman's support for higher taxes, primarily for commercial property owners.

The meeting appeared a success. Council members articulated their priorities for spending and cutting, and found some common ground in the process.

The city's budget officers now have direction in crafting a budget proposal that the council will review in August.

“Today really is about the big picture,” Castro said. “It's about getting a sense of our priorities.”

jbaugh@express-news.net

As originally published, the story misstated Elaine Chan's proposed cuts to Capital Improvements Management Services. She suggested slashing its budget by 30 percent but then increased that to 5o percent.

