Fact Checking The Mayoral Candidates’ Positions, Part One: Oakland’s Structural Budget Deficit

By Jennifer Inez Ward, Oakland Local

Oakland Local and Make Oakland Better Now! have teamed up to take a close look at the accuracy of candidates’ response to an online questionnaire from MOBN!. We want to know if candidates are being truthful and accurate in their responses, or are they veering from facts and offering opinion without any solutions? Each day, Oakland Local and Oaktalk will run a fact checking story on seven important questions.

Monday’s Question: How Will Mayoral Candidates Deal With Oakland’s Structural Budget Deficit?

When it comes to providing specific financial numbers or ideas many of our candidates for mayor fell short. Most of the answers, however, were spirited. Mayoral Candidate Rebecca Kaplan gave the most specific response.

Arnie Fields

In his response, Arnie Fields, said city government was mismanaged and that corruption in city hall must be rooted out before positive change can occur. Fields blamed former governor Jerry Brown for most of the modern day problem. He also accused Brown of using his policies to benefit in the sale of his home on Harrison Avenue.

What We Found: Fields was on point in saying that city funds have been criticized for being mismanaged in the past. That was something the state called the city on the carpet for its poor management of federal funds. However, when Fields tried to connect Jerry Brown’s city policies as mayor (Fields used the term “elitist policies”) he failed to provide direct proof that the policies were “elitiest “ and led directly to the former mayor’s home sale.

Greg Harland

Harland’s response is mostly devoid of specific ways he’d go about accomplishing his goals. Harland begins his response by saying, “I would balance the budget by cutting expenses. This will take major structural changes in city employee compensation and benefits”.

What we found: First, the candidate does not say what those structural changes will be. Second, given the current stalemate the city is in with its police department’s union and the strength of the fire fighters union, Harland doesn’t really lay out what he would bring to the table to turn things around for Oakland other than he will convince the union that, “it is in their best interest to do so.”

Rebecca Kaplan

Kaplan gives a detailed response to the question and down to the grit when she says she, “will work immediately to resolve the impasse regarding police pension contributions, seeking a 9% pension contribution as part of a strategy to eliminate police layoffs”.

What We Found: Kaplan has been on city council for two years, but she doesn’t explain what role she played in trying to prevent the impasse, nor what she’ll do this time around as mayor.

Kaplan was also criticized by some police  officers both for her actions during the Oscar Grant protest as well as during pension negotiations, making the effectiveness of her role somewhat challenging.

In her answer to MOBN, Kaplan reels off a list of things she’d like to accomplish with the budget, including long term solution plans. Kaplan wants to “refinance outside debt payments to lower interest rates, and reduce total outside debt, and switch to lower-cost sources, in order to reduce the impact of the structural deficit made up of debt payments.”

What We Found: It’s no secret the city’s debt situation is a hot mess, and Kaplan will have to do a lot of sweet talking and arm twisting to accomplish her goals. Rising pension costs will push the city’s projected deficit to $58.7 million by July 2011. And the biggest portion of that budget shortfall is a debt payment of $43.9 million due July 1, 2011, to the old Police and Fire Retirement System. The payment would be more than 10 percent of the roughly $400 million general purpose fund budget.

Kaplan has also proposed taking on certain short term measures to deal with the budget crisis including, “repositioning City assets that are currently losing money, and personnel management actions such as retirement incentives to lower personnel costs.”

What We Found: Kaplan doesn’t sketch out what “repositioning” is or how much she expects to save with her short term measures. Those measures will have to be effective quickly. According to a recently released City Audit report, the city is looking at fast-approaching deadlines and will possibly need alternative scenerios on paying on its pension obligation bonds.

In addition, many of Kaplan’s potential actions in dealing with the budget as mayor will have to be done in cooperation with City Council.

As part of her plans for generating short term revenue, Kaplan would also “like to see extra enforcement of  blight fines,  which she believes will serve to bring in revenue from the fines themselves, will help reinvigorate our neighborhoods.”

What We Found: Any extra enforcement will likely mean extra duty for city staffers because Oakland has growing areas dealing with serious blight, particularly foreclosed homes. Kaplan doesn’t say how much in additional fines the city can extract, so it’s unclear how much additional revenue the city will receive.

In addition, Kaplan’s office will have to coordinate with a wide variety of struggling city departments, including the police department, and a budget challenged public works department.

Kaplan takes credit for, “successfully advocated to be included in the Alameda County Vehicle Registration fee, and the new free Broadway Shuttle for which I helped land grant funding.”

What We Found: It is true, she has been active on this issue.

In June, the Alameda County Transportation Commission place a transportation improvement measure (Measure F) on the November 2, 2010 ballot that if passed by a majority vote of voters, would provide a Vehicle Registration Fee of $10 that would be used for local transportation and transit improvements throughout Alameda County.

In her response to MOBN about the structural debt, Kaplan also gives some generalities about “cutting red tape” for businesses. She also wants to rewrite the business tax code and zoning code to encourage job growth and economic revitalization. There are no details on how she would go about accomplishing this in her term.

Kaplan also goes on to say that that she’d like to see, “civilianizing certain roles in the police department.

What We Found: Kaplan does not say what specific roles in the department may benefit from civilianizing or how she would help change the relationship between Oakland and the Port Authority.

Kaplan said that under her administration she would make attracting new businesses a priority by, “implementing a clear plan for retail growth; changing zoning, identifying infrastructure needs and revamping recruitment and marketing programs to attract growth industries.”

What We Found: Kaplan doesn’t identify any examples of her proposals, so it’s hard to gauge how her plans could specifically impact the city’s debt.

Kaplan also connects attracting business to making sure our roads and infrastructure are improved, “City road and sewer repair efforts (including seeking outside funding) so these infrastructure costs decrease, rather than increase, over the long term.”

What We Found: Any efforts to deal with problems connected to our roads and infrastructure will have to delve into the Public Works Department financial problems. Even with outside funding, the city is looking at severe public work financial stress.

Don MacLeay

MacLeay decided to be efficient and combine some of his MOBN answers.

MacLeay said he will call a budget summit and a kind of budget “constitutional convention” where we put the whole budget on the table.”

Under this summit MacLeay has a nine point plan that he will advocate including, “Negotiate a transfer of the existing retirement plan to the employees; Start a new retirement plan that pays its liabilities on pay day; Have a plan for the ups and downs of the business cycle.”

What We Found: MacLeay will have his hands full just dealing with those issues. The city’s relationship with its unions is tense, at best. MacLeay doesn’t give an example of an effective alternative new retirement plan that pays its liabilities on pay day. Also, in his response, there’s no follow up details on developing city plans for dealing with business cycles.

MacLeay’s other points also fail to map out his goals. For example, he writes that he’d like to see, “Mandates, such as Measure Y need to become part of the law and policy of city government”, but there’s no specific actions proposed by the candidate.

MacLeay said good relations between city employees and the local government comes from “giving workers a fair work environment. We will not get the partnership we need from our employees and our unions if we do not live up to this promise of good conditions, good benefits, JOB SECURITY and a positive working environment. If we do, then we can work out viable contracts.”

Don Perata

Perata also wants to bring the experts on board to study the city’s growing fiscal problems. “We need experts in public finance to establish a common set of numbers that everyone can agree on in order to work to put together three, five and ten year expenditure / recovery plans for the city,” he said.

What We Found: Convening summits is a popular tool used regularly by elected officials. Dellums oversaw an economic summit with a few weeks after winning the election. And the current mayor regularly attends a variety of summits, yet it’s unclear what specific direct action has come out of these summits.

As part of his answer, Perata also thinks city government is too “top heavy” and as mayor, he would cut some administrative positions.

“I’d be shocked if I couldn’t find 80 jobs in city hall less important than the  80 cops who were laid off,” Perata wrote. “In fact, I’ve identified 30 alone in the city administrator’s office.”

What We Found: Perata did not name the 30 positions in the city administrator’s office that needed to be cut, so it’s unclear how realistic his plan is.

Jean Quan

Quan gives four bullet point responses to Question 2 that lacked any real detail. She said she wants to “Negotiate police pension contributions;(and) extend PFRS payments using existing tax rate.”

What We Found: Quan’s relationship with the police has been strained. Quan was blamed heavily by the Oakland police’s union for the recent layoff of 80 officers. Quan was also right in the middle of the Oscar Grant dustup with Kaplan.

AS for the PFRS payments plan, a recently released report by the Office of the City Auditor shows that it will be a tricky situation given that the city will still have to pay into the system.

In her response, Quan  also said she would like to continue to pay down internal debt.

What We Found: Paying down the debt will be an important thing to continue if the city can dig its way out of this financial disaster.

Reorganizing city services and increasing “retail sector revenue” are also Quan goals although she doesn’t offer suggestions on how to make either of those ideas happen

Joe Tuman

Tuman too wants an outside firm to study the city’s finances. “We will audit to gain a clearer perspective of efficiencies for cost, functionality, and ability to achieve core responsibilities of government,” he wrote to MOBN.

Tuman said as a result of the audit his office, “will act to effect as many cost-saving measures as possible in an effort to reduce the deficit.”

What We Found: Tuman will definitely be cutting to the bone with any cost-saving measures. According to a report  released by the city, since 2008, the city has implemented a number of cost saving measures including, closing City offices through furloughs, eliminating 237 jobs, laying off 150 workers, and closing branch libraries one day per week.

Tuman wants to also meet with labor unions regarding the city’s deficit.

“I will not in this document spell-out what demands I will make on our unions; this kind of information is strategic for negotiation, and only a neophyte would show his hand before the negotiation process has begun,” he wrote.

Tuman said he would also work with “external funding from the state or federal government, which might be used to supplement core functions.”

What We Found: Tuman didn’t spell out what he would do to get extra funding.

Terrence Candell

Candell give a brief two point bullet plan which includes taxing commuters to Oakland one percent on their paycheck; and putting tolls on major Oakland freeways.

What We Found: Candell, a supporter of Oakland’s own currency, doesn’t provide details on how he could push through a unique program like taxing commuters.

Candell’s second idea wouldn’t work because bridge tolls are administered by the Bay Area Toll Authority and the state agency Caltrans.

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