Last week, the full extent of Oakland's fiscal pain was revealed in a Friday press conference by Mayor Ron Dellums. The city faces nothing less than a $42 million budget deficit, and Dellums, his longtime aide Dan Lindheim, and consultant and former city manager Robert Bobb have been working for weeks, trying to figure out how to square the books. (At least, Bobb and Lindheim have been working on it. We're not so sure about the other guy.)
Under Dellums' plan, all currently vacant city positions would be frozen until the crisis passes. In addition, the mayor has proposed laying off at least 84 city employees, increasing traffic ticket fines and parking meter rates, and some funky bookkeeping magic like shifting some general fund costs around to different city funds. That'll help, but as the mayor conceded, there will still be around $10 million left to cut if the city is to get back in the black. Dellums suggested the city council consider the following ideas: laying off about 120 more employees; getting whoever still has a job to kick more money into the pension and health care accounts, relieving the city of some of its obligations; and closing City Hall every Friday from now until the end of the fiscal year in June 2009.
The city council is also expected to consider cutting its own discretionary budget, which amounts to $750,000 per councilmember and was recently bumped up under the administration of Deborah Edgerly. But securing cooperation from the city's employees could be tough; one union leader told the San Francisco Chronicle that he prefers to see cuts in upper level administration, charging that many senior officials often just duplicate work done elsewhere in City Hall.
While the city council is examining these proposals, councilmembers are also likely to take up the issue of President Ignacio De la Fuente's anti-nepotism ordinance, which failed to make it out of a council committee after Jane Brunner and Nancy Nadel objected.
Oakland Feels More Pain
Just so you know, Oakland's not done losing money, even if it manages to pull off all of these reforms. First, the state of California has resolved its own recent budget fiasco by swiping cash from local governments. Under the new state budget plan, local redevelopment agencies will be forced to take $350 million that would have gone to jump-starting economic development and redirect it into the state's education budget. Oakland's share of the obligation comes to almost $9 million.
Second, the software company McAfee Inc. will no longer be giving the city roughly $660,000 a year. You see, the company's lease to name the Oakland-Alameda County Coliseum is expiring, and McAfee officials have decided not to renew it. Under the old lease, McAfee gave the Coliseum Authority, which is jointly administered by the city and the county, $1.1 million. Authority officials are already shopping around for a new company to slap its name on the stadium, but they won't exactly be able to demand the highest prices. The Oakland Athletics are almost guaranteed to leave in a few years, and the Raiders have been shopping around for other venues when their lease expires. To say nothing of the general downturn in the economy, which tends to hit promotions and advertising budgets early and hard.
Raiders Lose Again, Coach May Lose Job
Speaking of the Raiders, guess who choked in the fourth quarter last weekend and blew a 15-3 lead? Sunday's loss puts the Raiders at a dismal 1-3 record, and Raiders watchers are counting the days until coach Lane Kiffin gets fired. Al Davis, the notoriously private owner of the Raiders, announced that he would hold a press conference sometime this week, and speculation is rising that Kiffin will finally have to find some other way to earn a living.
Housing Projects Go Private
Finally, the Oakland Housing Authority has settled on radical surgery to deal with the worst of its dilapidated housing projects. In addition to large-scale complexes, the Housing Authority manages 254 smaller apartment buildings scattered around the city, and many of them have long been magnets for drugs, crime, blight, and the worst of urban human misery. Last week, the Housing Authority Board voted to sever those "scattered sites" from its own administration, as an accounting trick to get more money from the federal government. Here's how it works: the Authority transfers title to the property to a nonprofit, the nonprofit applies for Section 8 status, and suddenly the Department of Housing and Urban Development will double its federal subsidy. The Housing Authority would theoretically use the extra cash to clean up the worst of its housing projects, but some residents fear that this is just the beginning of a process that will ultimately take the scattered sites off the grid of affordable housing, putting them out into the street.
Seismic experts have come up with a design that might keep UC Berkeley's Memorial Stadium from killing football fans during an earthquake; the scheme is expected to cost up to $175 million. ... The plan to extend BART to downtown San Jose got an additional $239 million from the California Transportation Commission.
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