City Council Gives Themselves 6% Raise (Budget Part 1)

Last week Sacramento's proposed 2015-16 budget was released for public comment. The contents of that budget tell an interesting story about the priorities of the City Council - A story that doesn't support the rhetoric coming from our elected officials.

The proposed budget "reflects adopted Council priorities" and amounts to almost $1 billion - that's almost $2,000 for every man, woman and child in Sacramento. Think for a moment ... what could you do for your family, and what kind of amazing vacation could you take, if you had $2,000 extra for each person in your family?  But I digress.

So what exactly is the City proposing to do with all of that money taken from you in taxes and fees? Well, to start with, each Council Member will increase their own budget by 6%, or about $25,000 over last year's approved amount. That's right, you're paying more in Measure U taxes so that they can fatten their own budgets. Between the Mayor and City Council, there is a proposed increase of over $790,000 from the last approved budget.

When was the last time you got a 6% raise at work? And what exactly are the City Council doing to deserve such a pay increase? That is what the rest of this series intends to answer.

City of Sacramento Budget

Budget Part 2: Public Safety - Not A Priority

Budget Part 3: Economy is for Winners

Other Cities Lead While Sacramento Just Pretends

Sacramento Leaders Don't Understand Simple Math

Sacramento is the capitol of the most productive state in the United States. Within the last 10 years, California was the 6th largest economy in the world, surpassing developed countries of global significance such as Italy and Russia. One would think that the capitol city of that powerhouse should be strong and vibrant, a beacon of hope and prosperity.

However, Sacramento's leadership over that time has done an abysmal job of investing in city infrastructure, building safe communities, and promoting an inviting environment for job creation. What's worse, city leaders continue to ignore the voice of the people and pursue a losing strategy. Not only should Sacramento voters get more engaged in City planning, the City Council and Mayor should consider it their duty to reach out to the public ... not ignore them.

Other effective City Council Members are doing just that - asking residents what they need. In the City of Long Beach, Rex Richardson has taken a portion of the city budget, dedicated it to infrastructure investment, and held community meetings to set priorities for these expenditures. There are countless other strategies that can help local governments encourage citizen participation. The Municipal Research and Services Center (MRSC) researches, compiles, and provides for free packages of strategies and materials for use by local governments.

MRSC notes, "formal city hall and courthouse settings can be intimidating, and hearings can sometimes be dominated by those who are more comfortable with public speaking. Such hearings may not be the best way to encourage comment from a wide cross-section of community residents and may not fit into citizens' busy schedules. The format of hearings often leaves little, if any, room for reasonable discussion, give or take, or response to prior testimony. Instead, it is important to conduct a thoughtful public process in advance of the public hearing."

Would You Feel Intimidated?

 Oddly, Mayor Kevin Johnson is the current President of the United States Conference of Mayors (USCM) - an organization that itself gathers and provides best practices for local governments. So, one would wonder why he and his city don't follow many of them...

A myriad of other sources of information are also available to City Leaders, if they could just get past their own egotistical self indulgence. For instance, a survey of more than 13,000 small business owners was conducted, asking what policies make a city business friendly. Sacramento was ranked #82 on the list of lowest rated cities in the country. A thoughtful City Leader should consider its business environment, particularly when Sacramento faces higher unemployment than cities both to the East and West - higher than the state average, even. One vital finding of the survey was that the effects of poor licensing regimes (at all levels of government) were twice as important as taxation, and that easily understood tax regimes were at least as important as low taxes.

If City Leaders listened more to what residents need, and small business owners want, maybe the 2035 General Plan Update would have been more on point.  There's still time to change direction.

The Future of Sacramento Development - General Plan Update 2035

Another key component to Sacramento's future success is planning for development.  This is the second article discussing the 2035 General Plan Update released in August 2014.

According to city leaders, the city intends to "encourage compact, higher-density development..." (LU 1.1.1).  Throughout the city, they intend to build up - not out.  The premise behind such a proposal is that not enough Sacramentans live in multi-unit apartment buildings.  Among the stated purposes for this requirement to increase density are:  supporting transit, reducing vehicle trips, promoting pedestrian/bicycle friendly neighborhoods, and increasing housing diversity.

Sacramento's Big City Skyline

Now I, personally, want to see Sacramento make the transition into "big city" status.  There is currently estimated to be more than 475,000 residents in the City of Sacramento.  There are only a handful of cities in California bigger than Sacramento, as reported by the California Department of Finance.  This places Sacramento as the 7th largest city in California, following:  Los Angeles (3,904k), San Diego (1,345k), San Jose (1,000k), San Francisco (836k), and Fresno (515k).

A whole different "cowtown" world

But, in order to break into big city status alongside northern California giants like San Francisco and San Jose, there must be fundamental change - change that has long been met with less-than-enthusiastic response from residents who like to think of Sacramento as a "cow town" (see Here, Here and Here).  There's something to be celebrated about having a reputation for nice people, slower pace, and urban farms and livestock.


When you get down to it, here's the crux of the argument for greater infill development and higher housing densities.  The percentage of buildings with five or more units in Sacramento is about 22.5% - Now, compare this with Los Angeles (45.5%), San Diego (35.5%), San Jose (25%), and San Francisco (45.5%).  It simply can't be said that the City's skyline rivals that of San Francisco, San Jose or Los Angeles.

City leaders have a schizophrenic vision of shedding Sacramento's cow town reputation in favor of tightly-packed residents, robust transit and non-motorized transportation options, while still promoting agriculture (lately with the "Farm to Fork" fad) and open space (LU 2.3.1).  It makes one wonder whether they're trying to appease the voters (who like the "small town" feel), while still pushing a big city agenda.

City Leaders Miss the Mark with General Plan Update

Last Thursday, the City of Sacramento released its 2035 General Plan Update.  This article is the first of several to be written over the next month delving into details of the City's long-range planning.

Everyone in Sacramento is still concerned about the economy.  Sacramento still has one of the highest unemployment rates in the state at 8.4%.  With a population of about 500,000, this means that 42,000 people in Sacramento are looking for work and unable to find a job.  This doesn't include those of you that are working part time, but would prefer full-time employment.  Residents of Sacramento are far worse off than the average Californian (7.3%), and should be in shock of our close neighbor San Francisco (4.5%).

With such low prospects for the talent and workforce that exists in Sacramento, one would hope that City leaders would be aggressively developing and promoting policies that bring more business and jobs to our doorstep.  Other than the Entertainment Sports Complex, what business, jobs, economic proposals have been touted by the City Council?  Perhaps there is an underlying reason that we aren't seeing appropriate activity from Sacramento's leadership.

Cue the General Plan.

I'll be looking only at the part entitled Economic Development today.  On the very first page (2-85), city staff write:

"Businesses are an important source
of the city's economic well-being..."

Wait, what!?!?  Businesses are the (1) central, (2) most important, (3) imperative, (4) required source of economic well-being.  One might say that I'm arguing semantics here in suggesting that a different word should have been used, but this is absolutely a distinction that reveals the nonsensical thinking of Sacramento's economic development plan.

I will acquiesce that a significant portion of Sacramento's economic activity is tied to state government (27.6% in 2011), but the likelihood that Sacramento will add jobs through state government is low, and Sacramento's leadership can't affect change that will improve those odds.  Let's focus on what we CAN change, and not what we CAN'T.

A simple economic principle is that wealth can only be created by building or doing something - it must come from business.  It matters little whether the production is by small business or multi-national corporations.  This is why the choice of words used in the planning document are so ... well, wrong.

What kind of "supportive business climate" are City leaders planning on using to bring business to Sacramento?  Let's look:

1. The first element of the plan is to develop an Economic Development Strategy to "identify priorities, support prosperity, and improve long-term fiscal competitiveness" (ED 1.1.1). What does this mean to you?  To me, it means "we don't have a clue what to do, so we're going to hope something lands in our lap."
2. An equal portion is to develop the City Image to "promote Sacramento among its citizens and the wider business community as a livable community and an excellent place to do business" (ED 1.1.2).  I think we've all heard the idiom actions speak louder than words.  It's true - and especially true in the business community.  Simply telling them that Sacramento is a "livable community" does absolutely nothing to build a better business climate.
3. Alright, how about Economic Development Partnerships to "partner with economic development organizations and business to improve and advance Sacramento's economic development climate" (ED 1.1.3).  This sounds like we might be getting somewhere.  But if you read it closely it says that the City Council will abdicate their responsibility for economic development to outside organizations, so they can shift blame and point fingers when five years down the road we're still stuck in the same rut.
4. The best element of this plan is the Small and Startup Business Assistance to "assist small and startup businesses with resource referrals and financial and technical assistance" (ED 1.1.4).  I am hopeful that this proposals receives all of the attention, time, and consideration from the City Council that it certainly deserves.  I would also be hopeful that the City Council would consider extending similar assistance and relief to ANY business which might open doors and employ our neighbors in Sacramento.
5. Fifth on the list of priorities is Tourism and Related Business "to work with the Sacramento Convention and Visitors Bureau... to expand local amenities and to market Sacramento as a tourist destination and convention venue" (ED 1.1.5).  Sacramento is a wonderful place to live, and a great place to visit.  Consider, however, how many people from San Francisco or San Diego come to Sacramento for a vacation.  Now, compare that with the number of Sacramentans that choose to go to San Francisco or San Diego for vacation (or sometimes just a weekend journey to the Bay).  Tourism revenues are highly volatile, and without a national or global profile this seems like a policy that was produced when the "spaghetti was thrown against the wall".
6. Moving down the list we find Environmentally Sustainable, Green Technology, and Clean Technology Businesses to "attract and retain environmentally conscious businesses that contribute to long-term economic and environmental sustainability" (ED 1.1.6).  There is a clear and obvious lack of focus in this objective.  Taken in concert with other initiatives of late, such as "farm to fork capitol", it demonstrates an unfortunate lack of vision from the City's leaders.  This policy appears to have been composed by an intern that has been reading newspapers about new business initiatives across the nation and wants one of them to come to Sacramento.  One of these industries might be a good fit, or we might find a better fit with biotech, financial, goods movement, or other industry sectors.
7. Finally, the City proposes a Small Business Program to "support ongoing efforts of the Business Environmental Resource Center efforts to advance sustainable business programs" (ED 1.1.7).  Well, let's start by saying (again) that BERC is not a City program.  It is built and run by the County.  Once again, City leadership is abdicating their responsibilities to another outside group - and in this case, one that does not necessarily have the City of Sacramento as its core concern.  BERC is a portal for businesses to learn about and comply with regulations and licensing ... hardly an "attractive" resource for developing a vibrant economy.

It took only two pages of the six in the Economic Development section of the 2035 General Plan raise serious questions about the competence of City staff and the ability for City leadership to bring economic prosperity to Sacramento and help bring our deplorable unemployment under control.  What's worse, none of this economic plan recognizes, supports, or promotes Sacramento as the hub for coastal goods movement, and a gateway between California's ports and the rest of the Western United States.  Sacramento has key infrastructure for air, rail, waterway, and roadway intersections.

I will leave you with the comments of three local leaders ... all of whom seem to be echoing (in part) my comments above.

A look ahead: Sacramento’s five-year forecast