San Jose’s $10 Million Surplus Partly From City Employee Job and Pay Cuts

SAN JOSE (KCBS)— San Jose’s mayor released his ‘March Budget Message’ and for the first time in years, the city is expected to be operating in the black this upcoming fiscal year.

It’s quite a difference according to Mayor Chuck Reed whose hopes are to use some of those excess dollars to restore services that have suffered the budget axe.

“Last year we were looking at a $100 million gap that we had to fill. This year we’re looking at a small surplus,” Reed said.

KCBS’ Mark Seelig Reports:

That surplus is $10 million and came at a steep price. Reed said cuts to services like city employees and their pay helped create the new cash flow.

While the financial outlook is brightening the mayor is urging San Jose to proceed with caution because of the projected $22.5 million deficit in 2013-2014 fiscal year due to an expected rise in retirement costs.

However, the city doesn’t plan on sitting on their money.

“We have four brand new libraries that have never been opened. We’ve funded the construction with special bonds,” he said.

The mayor said the libraries will begin to open to the public this year.

In addition he wants to allocate $2 million for gang prevention as well as street maintenance.

The City Council will vote on Mayor Reed’s budget message at the end of March with a final budget required by the end of June. Mayor calls it inappropriate behavior, will meet w/ City Manager.

(Copyright 2012 by CBS San Francisco. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed.)

More from Mark Seelig

    Why does the city think it has extra money? I thought SJ was almost broke. Sounds like creative accounting. Is it an election year? Still need to fix the pensions. Now all the Mayor wants to do is spend it.

  • macbean

    I agree that they need to proceed with caution. Just because you have money, doesn’t mean you need to spend it. As an individual, if I suddenly came across an pile of money, I would, at the very least, pay my debts and level my budget, before I did anything else…

  • bob

    Maybe Governor Brown should take some notes and cut a bunch of bureaucrats atthe state level ?!!?!

  • DT

    I think that Mayor has figured out a whole new financial program. If cut your employees’ salaries and benefits, you can show a surplus. Imagine how much money he can have next year to spend if he just cuts those unnecessary items like medical coverage and power. He could have so much money, he could redo the airport or the convention center again. You know this plan works for Walmart. If you cut your employees’ salaries enough, they will qualify for Medi-Cal.

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