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The City Council of San Bernardino Cuts $26 Million in Spending

Blog Jan 15, 2013

The San Bernardino City Council, which is already in bankruptcy, voted to cut $26 million in spending in an effort to keep the city staying afloat. The City Council is currently a facing a budget shortfall of $45.8 million. The decision to slash millions from the city’s budget will help the city from dissolving and being governed by the county.

The council decided to freeze vacancies in the Police Department and also to slash the overtime budget of the Fire Department by 35 percent. The decision to freeze hiring in the Police Department is quite significant, given that the city saw an increase in violence and crime activities recently.

CalPERS, the state’s public employee pension fund, did not receive any payment from the city since filing for Chapter 9 bankruptcy protection on August 1, 2012. According to officials of the city council, the stop payment will save more than $12 million for the city. According to Councilwoman Wendy McCammack, “This is a document that I’m holding my nose and voting yes on.’’

The plan to slash the city’s budget was approved in the city council’s voting by 5-2. According to City Atty. James Penman and Mayor Patrick Morris, it was a necessary step towards overcoming the city’s financial crisis and restructuring the city’s debts. In a meeting held at City Hall on Monday, Mayor Patrick Morris said, “We have a mountain to climb here.’’
At Monday’s hearing, Councilman Chas Kelley criticized the plan to slash budget. He said that the new plan is shortsighted and not addressing San Bernardino’s long-term financial health, which according to him, depends on attracting business and expanding the middle class.

According to Kelley, “This budget is a financial equivalent of using leeches to bleed a sick patient…….There is no vision in this budget for our city’s economic renewal.”

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Lynette Zang

Chief Market Analyst, ITM Trading

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