Being Smart About San Leandro's Finances

City finances are among San Leandrans’ biggest concerns these days, and rightly so. The priorities we set
and how we manage the budget today will determine our success in the future.

As Mayor, I approach the city’s budget the same way I approach my family’s finances: Establish clear
spending priorities and savings goals, put aside funds for unexpected expenses and emergencies, pay
bills on time, and try not to waste money. Of course, managing city finances is exponentially more
challenging than managing one’s personal finances, but the basic principles still apply.

Fortunately, San Leandro is financially stronger today ever before. The economy is thriving,
unemployment is lower than it has been in 20 years, and our city has become a destination for
entrepreneurs and established businesses who are creating new jobs and adding to the tax base.
But we still have work to do, especially when it comes to reigning in the city’s escalating retirement
costs, which are on the rise because of the California Public Employees’ Retirement System (CalPERS) fund
lost about $100 billion in the Great Recession and never has fully recovered.

Payroll and benefits are the city’s biggest expense, accounting for about 65 percent of the general fund.
And that makes sense—we want to be a fair employer that offers good pay, so we can attract and retain
quality people. Beyond payroll and benefits, we have many important priorities to fund: low-income
housing developments, infrastructure investments, sustainability efforts, disaster preparedness, and
ongoing improvements to our schools, public parks, neighborhoods, and commercial corridors. As
Mayor, I’m focused on funding initiatives that will ensure our neighborhoods are safe, our schools are
strong, and that San Leandrans have access to jobs, parks, culture, recreation, public transit, and other
considerations that benefit all residents.

Rising pension costs and other pressures are requiring us to be creative and to think beyond the
constraints of the budget. One of the reasons I am active in so many regional government organizations
is because there’s a lot of money out there. Since I’ve been Mayor, we have secured a number of grants
to pay for programs at no cost to our residents. Some recent examples include: securing funds for the
880 corridor through the Bay Area Air Quality Management District’s CARE program, getting free bus
passes for San Leandro High School and John Muir students from the Alameda County Transportation
Commission (ACTC), and accessing additional resources to support our disaster preparedness and Adopt
a Drain initiative through Cities of Service and Bloomberg Philanthropies.

And yes, we must reign in the unfunded liabilities related to employee pensions. The plan we
implemented is referred to as the PULL Program, which stands for Prioritizing Unfunded Liability
Liquidation. In short, it’s a savings account that sets aside half of the proceeds from the sale of City-
owned property or unspent funds at the end of each fiscal year to go towards pension costs and related
obligations. When I became Mayor, we set a goal to put aside $5 million dollars towards these needs
and, due to careful planning and strong revenue years, we have surpassed that goal and have actually
set aside over $15 million dollars. I am proud of our city employees who have partnered with us and are
now paying their full share of pension and retirement costs.

Here are just a few of the investments we have made recently to improve the quality of life today while
also preparing the city for a stronger, healthier future:

  • We invested in infrastructure retrofits and Smart City technology for energy and water equipment,
    of converting streetlights to high efficiency LED lighting. These improvements will result in
    savings of $8 million dollars in energy costs over 15 years, reducing the City’s greenhouse gas
    emissions by 14 hundred metric tons annually.
  • The City won a $3.9-million grant from the California Energy Commission to construct a 1-MEGA
    watt solar power generation system at the Water Pollution Control Plant. The energy produced will
    provide half of the power for the Plant and decrease greenhouse emissions.
  • The City Council adopted the largest Capital Improvement Program in our City’s history, which
    allocated funding for long-needed improvements to roads, buildings, and parks.
  • We completed over $8 million dollars of rehabilitation on our roads—the first opportunity in
    decades for the city to be able to invest to this much in our streets and roads.
  • We approved the Community Care Initiative, a $1-million fund to address code compliance and
    maintenance issues to improve the quality of life and aesthetics in our city.
  • We made remarkable progress to improve our public spaces: Chabot Park is reopened to the public;
    Warden Park is under construction; and Grover Cleveland Park and Washington Manor Park both
    received grants to build new playgrounds, with help from a nonprofit group rallying to lend a hand in
  • We hired a full-time Emergency Services Specialist who provides training opportunities to residents and neighborhood groups about how to prepare for the next earthquake, natural disaster, or large-scale emergency.

Overall, I believe we’re achieving the proper balance: working hard to reduce pension costs, finding new
grants and outside sources of funds, and doing everything we can to reduce spending and save money
while also prioritizing quality of life issues that benefit all San Leandrans.

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