Stable but limited.
That’s how San Jose City Manager Dave Sykes describes the city’s budget for 2019-2020. Sykes on Tuesday released his proposed operating budget for the next fiscal year, which will be mulled in a series of study sessions and public hearings.
Following the lead of Mayor Sam Liccardo’s March budget message, Sykes warns of forecasted shortfalls in the next four years amid a potential economic downturn. In 2022-2023, those shortfalls will range from $1.7 million to $13.7 million, Sykes said.
The limited resources means San Jose will struggle to expand “much-needed services” to tackle a growing backlog of maintenance and infrastructure projects. A $650 million bond passed by voters last fall will help address some of the city’s most critical needs.
“The City will be undertaking major efforts over the next decade that will reshape our City,” Sykes wrote, citing large regional transportation projects including the transformation of downtown spurred by Google’s proposed tech campus, an airport expansion, broadband and digital connections and the creation of more housing. “This period of transformation is occurring at the same time the City continues to confront challenges in meeting its service demands and addressing infrastructure needs.”
Proposed investments in 2019-2020 are focused on areas Liccardo identified in March as priorities: Saving, public safety, controlling housing costs, homelessness, tackling blight and environmental protections.
The majority of a projected surplus of $5.1 million will be put in savings, Sykes said, helping to reduce shortfalls in 2020-2021 from $15.6 million to $10.9 million.
Some of the administration’s housing priorities include figuring out a strategy to production of moderate-income housing and increasing housing and services opportunities for homeless residents, including those living in encampments.
Sykes also proposed a modest increase in city staffing, adding about 209 net positions. About 71 of them are covered by one-time funding, bringing San Jose City Hall’s total employee count to 6,622 positions.
Read Sykes’ full proposed operating budget here.