Town Square

Post a New Topic

Menlo Park faces $1.3 million city deficit

Original post made on Apr 20, 2010

Menlo Park is facing a $1.3 million deficit for the fiscal year that begins July 1, and cuts to city services could be on the way.

Read the full story here Web Link posted Monday, April 19, 2010, 6:15 PM

Comments (25)

 +   Like this comment
Posted by Joanna
a resident of Menlo Park: Downtown
on Apr 20, 2010 at 8:02 am

Rojas should resign and then the deficit would be only $1.05 million instead of $1.3 million. Cutting his assistants would bring the deficit below $1 million.

Cutting the $100k+ tree expert off would bring in more savings.


 +   Like this comment
Posted by Seriously?
a resident of Menlo Park: Downtown
on Apr 20, 2010 at 8:30 am

Sure, in one of the wealthiest cities in the state, lets cut the programs that support the few needy residents. Glad we have our priorities straight.


 +   Like this comment
Posted by mary
a resident of Menlo Park: Central Menlo Park
on Apr 20, 2010 at 9:32 am

I have on my desk TWO mailings from the planning department regarding the Menlo Gateway Project (Bohannon Hotel-Office. One addressed to my husband or occupant, the other to Postal Customer Local. HOW MUCH MONEY IS WASTED DOING THESE DOUBLE MAILINGS? Isn't there anybody at the city that could fix this problem? No consultants needed to figure out this could save time and money and trees! Stop wasting my tax dollars!


 +   Like this comment
Posted by truth
a resident of Menlo Park: Belle Haven
on Apr 20, 2010 at 9:36 am

Mary does not wish to be notified. Fine. for anyone in city hall reading this, I wish to see even more notification and communication about projects coming up. I think the city should be involved to the furthest extent and I think the project impacts are such that we have to be involved. Mary will complain if she isn't notified. Mary will complain when she is.


 +   Like this comment
Posted by WhoRUpeople
a resident of another community
on Apr 20, 2010 at 10:42 am

This won't be a popular opinion, but in my view I think those within Menlo Park government (both staff and elected officials) who have had a role in managing/budgeting the City's finances deserve at least a bit of credit. Looking around the bay area, almost every city is experiencing deficits due to (1) rising costs and (2) less than anticipated revenues. At $1.3 million, relative to the size of Menlo Park's budget, this is one of the lowest deficits I have seen. A solid accomplishment in such unpredictable financial times.


 +   Like this comment
Posted by Peter Carpenter
a resident of Atherton: Lindenwood
on Apr 20, 2010 at 11:19 am

WhoRUpeople states:"At $1.3 million, relative to the size of Menlo Park's budget, this is one of the lowest deficits I have seen. A solid accomplishment in such unpredictable financial times."


Hardly a measure of success that Menlo Park is not in as much trouble as other cities which also ignored the economic realities for far too long.

You need only to look a bit closer - your Fire District has a balanced budget, has paid down most of its previously unfunded pension liabilities, has an AA+ credit rating and has not resorted to a parcel tax. How? Because the Fire District started adjusting its expenditures over a year ago while other units of local government like Menlo Park, Atherton and the School Districts continued to sign outrageous labor agreements and refused to cut other expenditures. The longer they have waited the bigger the gap becomes between expenditures and revenues.


 +   Like this comment
Posted by Steve
a resident of Menlo Park: Allied Arts/Stanford Park
on Apr 20, 2010 at 11:45 am

Having Glen Rojas resign would be the honorable thing to do. He won't do it though. We need a strong and INDEPENDENT (no union puppets) City Council to make some real progress with a pair of scissors to make deep cuts in our payroll.


 +   Like this comment
Posted by monitor mac
a resident of Menlo Park: Felton Gables
on Apr 20, 2010 at 12:32 pm

If the $1.3 million deficit is only this year it's one thing. But MP is projecting 1 Million $ deficits for each of 10 years going forward.

Time for Glen to move on. And the fluff positions he as created -- like community engagement, and business development that doesn't.


 +   Like this comment
Posted by Sorry Peter
a resident of Menlo Park: Felton Gables
on Apr 20, 2010 at 12:33 pm

Sorry Peter, you are way off base including the school districts in your comments. The Menlo Park City School District has been hit by a larger than anticipated enrollment increase that was very hard to predict, the Sherson Lehman hit, which hit many people, tax revenue decreases, the roll back of revenue from the state, and the roll back of revenue from the Federal Government. This happened during a period of 1 to 1 1/2 years. During that time, the school district decreased their expenses by $550K and have now proposed to cut back expenses by approximately $1.2M-$1.5M to make up for the revenue short fall. (if Measure C does not pass) They ARE doing their job, while many of us enjoy the fruits of their labor by bringing us good schools, that keep our property values high. Including us in a conversation about our local government is way off base. We HAVE cut back, the city has not, and to this day I have not heard of any cutbacks?


 +   Like this comment
Posted by Peter Carpenter
a resident of Atherton: Lindenwood
on Apr 20, 2010 at 12:38 pm

Monitor Mac states:"If the $1.3 million deficit is only this year it's one thing. But MP is projecting 1 Million $ deficits for each of 10 years going forward."

If it is $1.3 million this year it will be even bigger in future years. If nothing else they have to add the cost of servicing the
'debt' associated with the current deficit - even if that is an implicit charge against reserves.

Once revenues and expenditures start to diverge the gap just gets bigger and bigger every year unless drastic action is taken. And with the majority of expenses in the personnel category then they MUST reduce both current personnel costs AND future retirement obligations.


 +   Like this comment
Posted by Circle Jerk
a resident of Menlo Park: other
on Apr 20, 2010 at 12:55 pm

Here's some ideas:

Why don't we lease out some of our over-weight police officers to the City of San Carlos, since their looking to outsource in order to cut their $3.5 million budget deficit.

Or how about approving the Bohannon project quickly. That should put $1.3 million in the city coffers immediately. isn't that what the city council has been negotiating these past months.

Or I know, let's propose revamping all of Menlo Park, with plaza's and 4-story parking structures and...


 +   Like this comment
Posted by truth
a resident of Menlo Park: Belle Haven
on Apr 20, 2010 at 2:30 pm

Peter is dead wrong. He also made the panic assertion that property taxes would plummet in Menlo Park. He was dead wrong then too. I can direct you to his exact words that were erroneous and I called him on it then.

Now he wants us all to think the fire district is setting the example for cities.

That is a joke.

I live in a community that requires almost 100 percent subsidization to provide services. And look at the options tonight, cut back on subsidy programs like child care, library services, senior citizen services, etc. I am not saying what the city should do, what I am saying is that people like Peter who live in Atherton and have no idea what poor is, really don't understand the complexities.

That has been my point about Peter's position all along.


 +   Like this comment
Posted by R.GORDON
a resident of another community
on Apr 20, 2010 at 3:38 pm

How sad to find out that Menlo Park, which is touted as a "dream place to live" has cutbacks in things like child care,library services, senior citizen services,etc.while "Seriously" calls Menlo Park "is one of the wealthiest cities in the state" and "to cut the programs that support the few needy residents" and while "mary" rants about how much money is wasted on "DOUBLE MAILINGS".
Are all of you growing your own before it is legalized?
And these are the same people who think the noise level of an HSR will disrupt their lives. What lives? Just get high and watch those trains shoot by and enjoy it.
Sell some land to the country (duh?) which finally comes in to build our national railway system.Ask for 1.3 million for one of the houses that is going to go into foreclosure when the IRS busts one of you Menlo Park banking geniuses.
Living so close to Stanford could be the reason so many think they are so smart......Stoop to conquer!


 +   Like this comment
Posted by Henry Riggs
a resident of Menlo Park: Suburban Park/Lorelei Manor/Flood Park Triangle
on Apr 20, 2010 at 3:59 pm

We do have a high tax base and regionally have many well off residents who still shop - our city management did not create that. The budget issues were building up before the meltdown (deferred paving, short city admin hours, no new playfields) because our expenses are not in control.

Like our neighbor cities, Menlo Park's budget is dominated by employee expense, and the fuzzy math of past pension commitments is now clear. We SHOULD build our commercial tax base - for the playfields and infrastructure we've been putting off for years - but we also need to get back on a sustainable employee expense path, not continue to put off the inevitable by shuffling accounts, dipping into reserves and praying for another bubble.


 +   Like this comment
Posted by Willy
a resident of Woodside: other
on Apr 20, 2010 at 4:06 pm

Dang, Henry.

Wish this site had a "recommend" button! :-)


 +   Like this comment
Posted by R.Gordon
a resident of another community
on Apr 20, 2010 at 5:12 pm

For Henry Riggs: Thank you for a really concise, clear and readable post with a show of dignity.
It was beginning to look like a waste of time to try and get an answer around here.
Thank you for the information.


 +   Like this comment
Posted by Maria
a resident of Menlo Park: Sharon Heights
on Apr 20, 2010 at 5:12 pm

Again, why are we spending money to revamp Menlo Park when we are in debt???!!!!

Rojas definitly needs to go...along with Robinson, Boyle and Cline!!!


 +   Like this comment
Posted by Peter Carpenter
a resident of Atherton: Lindenwood
on Apr 20, 2010 at 7:02 pm

Truth states:"Peter is dead wrong. He also made the panic assertion that property taxes would plummet in Menlo Park. He was dead wrong then too. I can direct you to his exact words that were erroneous and I called him on it then."

Once again Truth is wrong - here are my exact words, from 2008 no less:

"Palo Alto Weekly
Spectrum - Friday, December 5, 2008

Guest Opinion: Economic 'perfect storm' is brewing for local agencies

by Peter Carpenter

For many years I have been directly involved in local government agencies or in federal programs designed to support local and state agencies.
Never in that period have I seen such financial storm clouds as now appear on the horizon of local governments.
For the last eight years I have had the privilege and the responsibility of serving the citizens as an elected director of the Menlo Park Fire Protection District (which serves Menlo Park, East Palo Alto, Atherton and parts of San Mateo County) — one of the finest fire districts in the country.
Previously, I served as a Planning Commissioner in Palo Alto and, many years ago, as the federal official in the Office of Management and Budget who was responsible for coordinating all federal assistance to state and local governments.
With falling property values yielding less property-tax revenues, falling consumer and business spending yielding less sales taxes, increased retirement costs (because CalPERS has suffered significant loss of capital in the current financial downturn), continued demands for well-above-average salary increases by public employees, and the governor declaring a financial emergency, local governments in California are facing a Perfect Storm.
Unless local governments act promptly to respond to these dramatic changes we will see more of them joining Vacaville and Rio Vista in being forced into bankruptcy.
Housing prices and hence property taxes will be depressed for at least another two years — just about everywhere except the Palo Alto area, it seems.
And if a lot of the current homeowners request reassessments the decreases will be dramatic.
Similarly consumer and business spending are forecast to be depressed for the next two years.
And CalPERS, which is obligated to continue to pay out fixed-benefit retirement payments and which has seen huge losses in its capital, can only turn to local governments to make up the difference.
And local governments have no choice but to pay what CalPERS will demand.
And while this is all happening local-government unions are continuing to ask for significant increases in both salaries and benefits.
The total labor costs for most local governments are between 60 and 80 percent of their total budgets. While California's local governments are blessed with very talented and capable employees, the current process of salary-and-benefit negotiation has gotten out of hand.
Local-government employee unions insist that the standard for setting their pay be that they be above the average of other public employees. But if everybody is above average then the average goes up very quickly.
While we have many superb employees working for local government, those employees should not expect to receive salaries and benefits that are inconsistent with those of the citizens whom they serve or that will bankrupt their employers.
And in most cases those inflationary-spiral labor agreements are being approved in secret without any public input or scrutiny.
As an elected member of the Board of Directors of one of the finest fire districts, what do I think should be done to respond to this Perfect Storm?
First, local governments need to recognize that there is a crisis and act now.
Second, they need to involve their citizens in a careful look at each of their programs to determine which programs are no longer affordable — however nice or special they might have been in better times, or even how worthy any single program might be.
Third, they need to plan now for hiring freezes, elimination of overtime, reduction in services, layoffs, renegotiated labor agreements and, in the extreme, bankruptcy.
Fourth, they should consider accelerating essential capital-improvement projects (the operative word is essential), as construction costs during this downturn will be substantially less than if the projects are delayed until the recovery begins.
Finally, they need to move the review and approval of new labor agreements out from behind the current wall of secrecy from which the public is excluded.
Once new labor agreements have been agreed upon by the negotiators then those agreements should be simultaneously submitted to both the union members and to the public that will bear the costs well before the city councils and special district boards meet in public session to vote on those agreements.
The Perfect Storm can be weathered but not by sunbathing on the deck."

And the facts have proven my 2008 prediction to be correct - property values have gone down, many properties have been reassessed downward and this year the property tax 'increase' for inflation on the non-reappraised properties will be negative.



 +   Like this comment
Posted by Peter Carpenter
a resident of Atherton: Lindenwood
on Apr 21, 2010 at 8:39 am

Peter Carpenter is a registered user.

Sorry Peter states:"Sorry Peter, you are way off base including the school districts in your comments. The Menlo Park City School District has been hit by a larger than anticipated enrollment increase that was very hard to predict, the Sherson Lehman hit..."

I disagree, any unit of local government which needs a parcel tax is, by definition, not balancing its budget. The Sherson Lehman hit was totally avoidable if the district had practiced sound financial management and pulled its funds from the badly managed County pool.
The taxpayers should not have to pay for poor management.

Deficits mean that revenues are less than expenditures - simple.
Since it is properly difficult to arbitrarily raise taxes that means that expenditures have to be cut. Agreeing to increase salaries and benefits is not cutting expenditures. Failing to properly amortize unfunded pension liabilities as a current year's expense is not cutting expenditures.

A family, faced with fixed or falling income, has to reduce its expenditures. In a family only the children have recourse to the parents when they need more 'revenue'. It is time that all units of local government stopped behaving like children and stopped treating their taxpayers as parents with bottomless financial resources.


 +   Like this comment
Posted by WhoRUpeople
a resident of another community
on Apr 21, 2010 at 8:40 am

I need to retract the comments in my previous post wherein I credited those in MP government for "a solid accomplishment.....". In addition to the great points made here in this forum since, and based on this mornings Almanac article reporting that the MP CC, in closed session on the same night they were going to then take up the budget deficit and where to cut, voted to refile the lawsuit against HSR, I am truly disgusted. This is not an endorsement for HSR, my issue is one of priorities. I want/need/have to believe that the majority of the people who live in MP would rather see the money that will be spent filing and pursuing that suit be directed toward lowering the deficit and thus reducing/eliminating the need to cut some of the services on the chopping list; especially those that would affect the youth & elder programs and the less affluent in the community.


 +   Like this comment
Posted by psp
a resident of Menlo Park: Central Menlo Park
on Apr 21, 2010 at 11:55 am


Let me see if I understand this - Menlo Park's city council WILL spend dollars in a deficit budget environment to accommodate the three old men who oppose the HSR against the majority who (even in MP) voted for it but probably WILL NOT spend money to defend the pension reform initiative which is the purest expression of citizen's democracy today and would likely win in the election?

Okay, there you have it folks!


 +   Like this comment
Posted by truth
a resident of Menlo Park: Belle Haven
on Apr 21, 2010 at 3:01 pm

Where does it say the city is spending money on the litigation? The last suit did not include funding from the city, did this change?

PSP thanks for the value add. Probably will not means nothing to anyone. What the heck does your pet anti union stuff have to do with HSR? Stop wasting our time with that drivel.


 +   Like this comment
Posted by WhoRUpeople
a resident of another community
on Apr 22, 2010 at 10:05 am

You got me, Truth. I assumed a fact not in evidence. My bad. I guess it is possible that it costs nothing to file a suit of this type, that the City attorney and any outside legal counsel he is using to advise on its content aren't billing any hours (pro bono), that City staff having to work on data collection and staff reports are doing so on their Fridays off, and of course we know that the CC works for free anyway. So, yeah, I suppose it is possible that this suit and the previous one really didn't cost the City a dime.


 +   Like this comment
Posted by psp
a resident of Menlo Park: Central Menlo Park
on Apr 22, 2010 at 6:08 pm

Perhaps we can contact Mr. Flashman to see if he does work for free or not. I quote excerpts from below. Not sure if this looks like I'm anti-union or not. My apologies to all union members past, present and future.

The city of Menlo Park will join Atherton in re-filing a lawsuit against the California High-Speed Rail Authority. The City Council voted unanimously in closed session to join the suit at its meeting Tuesday, April 20. Stuart Flashman, the attorney who filed the original lawsuit, is seeking to re-open it, alleging that the rail agency withheld crucial information about how it arrived at its ridership estimates. Almanac News, Tuesday, April 20, 2010

If the union does file a complaint, City Attorney McClure said he will inform the council of its options in closed session. However, council members may decide they don't want to spend money defending a ballot measure the city didn't propose, McClure said. In that case, proponents would need to decide whether to have their attorneys defend the initiative in court., Jessica Bernstein-Wax, Daily News, 04/08/2010


 +   Like this comment
Posted by truth
a resident of Menlo Park: Belle Haven
on Apr 22, 2010 at 10:14 pm

Flashman is the lead attorney, right? Help me understand where you see city hours or city money going into this suit? If you are just going to play assumptions, then tell me and I will just stop chasing it. Assumptions are a waste of time but it is your right to make assumptions. I just wanted to see if you heard something.


Don't miss out on the discussion!
Sign up to be notified of new comments on this topic.

Email:


Post a comment

Posting an item on Town Square is simple and requires no registration. Just complete this form and hit "submit" and your topic will appear online. Please be respectful and truthful in your postings so Town Square will continue to be a thoughtful gathering place for sharing community information and opinion. All postings are subject to our TERMS OF USE, and may be deleted if deemed inappropriate by our staff.

We prefer that you use your real name, but you may use any "member" name you wish.

Name: *

Select your neighborhood or school community: * Not sure?

Comment: *

Verification code: *
Enter the verification code exactly as shown, using capital and lowercase letters, in the multi-colored box.

*Required Fields

Sneak peek: Bradley's Fine Diner in Menlo Park
By Elena Kadvany | 4 comments | 3,347 views

Marriage Underachievers
By Chandrama Anderson | 0 comments | 1,653 views

A Surprise!
By Cheryl Bac | 0 comments | 1,541 views

Best High Dives to Watch the Game
By Laura Stec | 4 comments | 1,226 views

Measure M-- I am not drinking Greenheartís expensive potion
By Martin Lamarque | 32 comments | 1,003 views