San Carlos Real Estate Agent, San Carlos Realtor Life in San Carlos in the Aftermath of Measure U… and a New Poll. | The White Oaks Blog
Living in San Carlos December 7, 2009

Life in San Carlos in the Aftermath of Measure U… and a New Poll.

by Chuck Gillooley

Life will be very different next year in San Carlos…

Such is the sobering reality of life in the City of Good Living.  Regardless of how you voted, the failure of Measure U ensures that changes will be taking place in San Carlos next year that will impact each and every one of us in some way.    Whether you’re one of the unfortunate souls who may lose your livelihood, or you simply can’t get into your favorite park because it’s now closed, residents of San Carlos will need to adjust to doing more with less next year.   There’s no question that City Hall needs to bridge the budget gap — we can’t deficit spend indefinitely (unlike our federal government.)  But how that gap will be closed is still very much up in the air…

Raise Taxes, or Cut Services — Is That It?

It seems that City Hall has a black & white mindset on solving the budget gap — either raise revenue, or cut services.   Now that the former is off the table with failure of Measure U,  the effort is solely focused only on cutting services.  The following is just a portion of what the City Manager is proposing for the new budget:

1.     Eliminate Healthy Cities Program
2.     Eliminate .7 Rec Coordinator and Special Needs Program
3.     Eliminate 1 Rec Superintendent Post.
4.     Eliminate Admin Assistant in payroll
5.     Reduce employee events like picnic, holiday luncheon, etc
6.     Reduce Planning contractor hours .6FTE
7.     Eliminate full-time Bldg Inspector
8.     Eliminate Park & Rec weekend maintenance.
9.     Reduce expenses in Finance operating budget
10.   Eliminate Police Diversion (Youth Offense) Officer
11.    Reduce Youth Center part-time staff
12.   Eliminate 25% of Police CSO staffing
13.   Eliminate full-time Park & Rec maintenance worker

Is the cutting of positions and services the only way to close the budget gap?  Have we truly looked at everything?

Are Wages and Benefits Off Limits?

That very question became ground zero for in many of the 136 comments from my original post about Measure U, because it appears that the wages and benefits of City employees are off limits in solving the budget deficit.  I know that the City recently instituted a tiered pension scale which is less for new employees, and that they have contractual obligations which makes changing compensation a pretty involved process.

But another San Carlos institution that is coping with job cuts and budget deficits has shown that they can share in the pain of their constituents — San Carlos School District Superintendent Dr. Craig Baker will likely delay or forgo an $11,000 bonus this year as part of the budget process.  Sure, it’s a drop in the $1.4M bucket, but that kind of gesture shows that everyone that’s involved in the process indeed has some skin in the game now.   I can’t say we’re quite there yet with City Hall.

A New Poll: Closing the Budget Deficit.

So what do you think is the best way to close the budget gap?   Should we take another run at raising taxes again, or should we just resign to the fact that a reduction in services is inevitable?  And what about wages and benefits?     It will be interesting to see the results of this poll:

What do you think should be done to straighten out finances at City Hall after the failure of Measure U?

View Results

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If you have other suggestions on how City Hall should best resolve this crisis, don’t be shy about leaving a comment!

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Life in San Carlos in the Aftermath of Measure U... and a New Poll., 2.6 out of 5 based on 5 ratings
Comments 33
  • I think there are other things that we can do. We should always be looking for areas that are wasteful and questioning what we need. I have only lived in SC for a short period of time but do we really need weekend park maintenance if we have it on weekdays? Are things needed in the same frequency in winter as in summer?

    I think there is also opportunity for new revenue streams. I’d be willing to pay $100 a year for wifi in all San Carlos parks or we could have ad supported wifi throughout San Carlos. Would any residents be willing to donate time to help other residents hang Xmas lights – would the beneficiaries be willing to pay money for it? Those are just examples, but in Silicon Valley we should definitely be thinking outside of the box.

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  • Employees in the private sector are receiving as much as a 10% salary reduction. California state employees have been hit 9.2%. San Carlos residents employed in the private sector have probably had pay freezes or pay cuts. Why shouldn’t the San Carlos City employees?

    State employees have had a 9.2% cut.

    http://articles.latimes.com/2009/apr/30/local/me-lawmaker-raises30

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  • Of course there should be wage/benefit cuts for city employees, as in the private sector. But, just like the school district, powerful unions are the real barrier to change and reform. But there is another alternative to the choice of cuts vs. taxes. It’s called attracting new business to the city, which generates additional tax revenue. Do this by making SC a radically more business-friendly town. Streamline processes, eliminate red-tape and bureaucracy, reduce regulatory burdens, provide incentives, increase marketing, etc.

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  • As a resident and homeowner in San Carlos since 1986, I believe the sky is not falling! Everything is fine. Everything will be fine. San Carlos will remain a great place to live. San Carlos will remain the City of Good Living. What is ahppening now is just a reflection of our nation’s current economic situation. If some people who work in private industry can lose thier jobs now, isn’t it logical and just that people who work for the government might lose their jobs too? Just as a family may have to cut down on their expenses – forgoe a vacation, keep their car another year, wait another year to do the kitchen remodel etc – it seems natural to me that cities and other government entities have to tighten their belts too. Just as the families who have to wait another year to buy the new car, San Carlos will be OK too. At some point, government’s insatiable demand for more and more money has to end. Government employees shouldnot be from the same economic troubles that effect private citizens.
    What makes San Carlos wonderful is NOT the city government and services but rather the people who live in San Carlos and their committment to their friends family and community – people who volunteer at the PTA or coach Little League or AYSO or at the Senior Center. I am confident this community spirit will not end if the City needs to cut back on some services.

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    • Arn,

      I wonder if you’ll feel as optimistic about the situation if you have seen some of the cuts that are being proposed. We’re not talking about losing a 500 sq foot park that nobody uses anyway. There are serious cuts being proposed to both the fire AND police departments — both organizations who are already operating on a joke of a staffing level. Unfortunately, those aren’t fixes that “volunteers” can make. San Carlos isn’t going to be such a great place to live if you have to wait an extraordinary amount of time for emergency services.

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  • Chuck,
    Thank you for posting this article and poll. I do feel that your poll is missing an option. How about D. All of the above. To think that one of these suggestions can solve our problem is not looking at the big picture. It is going to take all three to get us out of this mess. Raising revenue by ecomomic development, lowering employee costs, and cutting services. There is no silver bullet so we will have to take a multi-faceted approach.

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    • Hi Andy,

      Thanks for writing in. Putting an “All of the Above” option in the poll is something I definitely thought of when I put this post together. Why? Because like you said, it’s the most logical solution. It’s a no-brainer to see that it will take contributions from all three facets to pull us out of this mess. But that doesn’t seem to reflect the way that our leaders are attacking this problem — instead, we seem to take a tunnel-vision approach of pushing ONE solution at a time. First, we tried solely raising taxes and that failed. Now, we’re relying entirely on cutting jobs and services to make ends meet. In both of these cases, the burden falls entirely on the citizens of San Carlos; pay more money, or lose jobs and services.

      In retrospect, had Measure U been pitched as an “all of the above” solution — a smaller sales tax hike combined with a few cuts to services, AND a restructuring of some pay and benefits packages — I think it would have been much more palatable to the citizens of San Carlos, and probably would have passed. That way, everyone has some skin in the game. The vibe that I get from reading all of the comments on this site is that people resented the fact that they were solely responsible for picking up the tab to fix the budget gap.

      For what it’s worth, I voted in favor of Measure U, NOT because it was the best solution to fix the problem, but because it was the ONLY solution that was proposed. I didn’t want to lose the services that make San Carlos such a great place to live, but at the same time I’m not convinced that City Hall has put all of the available cards on the table…

      Chuck

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  • Two words:
    Union. Contracts.

    One of the bargaining chips in the good years was trading off benefits for salaries. Now we’re paying the price for those contracts. We *can’t* cut anything that’s guaranteed in the legal contracts we made with the unions.

    And, like everybody else, private sector or public sector, medical insurance costs rise obscenely year over year. 119 percent between 1999 and 2008.

    I think the best thing City Hall can do is openness: put out a spreadsheet with the costs (down to “office supplies: N%”) and specify which of the costs are required by state laws and/or union contracts. If I had a clear idea of what the fixed costs were (e.g. the electricity bill has to be paid no matter what), then I’d know what could be cut.

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  • I believe that unless our city “leaders” view ALL options as NOT off limits, we will remain in this viscious cycle of “where can we raise funds/taxes so we can continue to spend?”. Clearly the current city employees need to be forced to chip in. It may not be all the money we need, but it will definitely make a dent. Some jobs may have to be eliminated and some services may have to be cut (based on need).

    It saddens me that anyone in this economy feels entitled to a certain compentsation in spite of the ability to pay for it.

    Chuck, I think that this blog topic will be your most commented on…

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  • I agree. “All of the above.” The city needs to live within its means–period. If that means closing down services like the Youth Center, etc., then so be it. It’s getting to the point of ridiculousness. Why? Because in good times and bad, San Carlos either cries poor mouth or tries to fund ill-conceived programs like S.C.O.O.T. and artifical turf on playing fields. The latest is that it wants to be a pioneer in ‘green.’ Let’s stop playing the victim (wah-wah-wah…the State cut our funding again…wah-wah-wah) and make some tough choices already. Leave Fire, Police, Schools and Library alone. Everything else?????

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  • Amen Steve. The problem with Measure U was that it was yet another tax increase without clear deliverables. San Carlos already has a number of additional parcel taxes. We can’t tax our way out of the current mess we’re in. There was a $1M+ accounting error in San Carlos this year….we need to spend time coming clean on how that happened and how we prevent that. In the interim, the city needs to do what folks are doing individually and as families–make better decisions about where the money we have will go.

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  • I agree that reducing city employee salaries and benefits (especially pensions!) must be on the table with the other options. Anyone in the public or private sector would much rather take a 10% pay cut than lose their job entirely. Many San Carlos residents have already experienced one or both of those cuts in their private sector jobs.

    Secondly, the City must learn to spend within its means and PLAN for revenue fluctations between good times and bad. Just like private citizens, you have to save money for the rainy days. When business gets slow, I can’t go out and raise taxes for myself (e.g. raise my prices) to maintain my paycheck. Neither should the City.

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  • Eliminate the City Manager position, eliminate or reduce use of consultants, reduce use of outside legal counsel, stop spending money on artificial turf studies that the city can’t afford in any case, eliminate health benefits for retirees who immediately became consultants to San Carlos, defer public works if possible.

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  • Suggestion #1: Review the city’s organizational structure. Reduce layers of management. For example City Manager, Asst. City Manager, Park and Rec. Director, Park Superintendent, do we really need 3 levels of management between the city manager and a park and rec “worker”?
    Suggestion #2: Put all major projects and non essential work on hold. For example how much are we spending in manpower for planning the development of Wheeler Plaza given the current economic climate.
    Additional suggestions to follow.

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  • Suggestion #3: Across the board pay and benefit cuts. This would demonstrate to the residents of San Carlos a show of good faith by city employees and an understanding of what many residents have already experienced in private industry (for example, pay cuts, loss of benefits, loss of dividend income, loss of bonuses, reduction of 401K company matching contributions, and escalating health care costs). This would create a more positive atmosphere if a request for additional taxes was made by the city.

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  • I believe the accounting error Lori referenced is tied to the school budget, not the city.

    Regarding the question at hand, comments in here and elsewhere made it abundantly clear that Measure U failed because people think there’s enough fat to cut with city salaries, benefits, and headcount. And they could be right — I agree it should be looked at. The problem is, it’s easier said than done. You first need to benchmark what other cities have done with headcount, salaries, and benefits (what if San Carlos actually comes out favorable here?). Then you have to negotiate with the appropriate unions to get the required concessions and do so without driving talented employees away.
    My biggest frustration with the Measure U dialogue is that it was too often framed as a false choice — either vote for higher taxes or force employees to take a cut. It’s clear what people will choose between those two. But really they are separate (albeit related) issues…Measure U’s defeat has done nothing to guarantee cuts to salaries/benefits. I think the city made a big mistake by not making sacrificies like Dr. Baker and not effectively educating citizens on whether there is fat to cut or not on the salary/benefit side.

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  • Before any decisions are made, I feel there needs to be a fundamental change in the way city funds are viewed. Maybe if the powers that be took a look at the city budget with the same eye and perspective as they do (or should) their personal budget, then I think a lot of fat could have and can be trimmed.

    Yes, that brand new pair of Uggs sure do look nice, but do I really need them? No.

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  • It does not suprise me that the most popular remedy for City’s budget problems is a reduction in staff salaries and benefits. As an employee of a city to the south, I agree that a short term salary reduction is in order. We suspended contractual raises this year and will probably do the same again in 2010.

    The loss of say 10% of salary to city workers will be significant. Compared to cities to the south, San Carlos already pays employees rather poorly.

    With rspect to benefits, many long term employees have endured lower wages than their private sector counterparts with the promise of a livable pension. Remember, public enployees do not receive bonuses, stock options or contributions to a 401K. Most are not eligible for Social Security (or recieve much reduced benefits).

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  • First, let me say that I am a city employee – in Palo Alto. (I live here.) So feel free to salt my comments accordingly. But San Carlos staff benefits were already cut, and the staff I interact with work AWFULLY hard and don’t seem to be making a killing. It seems too easy for residents to expect City employees to take the hit. This is certainly true in Palo Alto as well.

    The fact is that cities offer a lot of services, and residents only pay for a small percentage of those services. (The rest come from sales taxes and hotel taxes, among other things.) Those revenue sources have taken a huge hit and this is not likely to improve at all quickly or completely. So the services we’ve become used to either need to be trimmed or new revenues found.

    Call me a black and white thinker if you like. But I really think it’s just basic math.

    After the Measure U vote I read that Grocott had said (paraphrased of course), “I don’t think this vote means that residents want to cut services.” Of course they don’t! They want the same services for less money.

    Anyway, what I want is a utility tax. It’ll raise some revenue – not quite as much as they expected the sales tax to raise – AND make energy a wee bit more expensive so hopefully discourage consumption. So we’d kill two birds with one stone.

    Thanks.

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  • To follow up on Ron’s comment, many private sector employees do not receive bonuses or stock options (or at least none that end up being owrth anything at most start ups). And in almost 20 years of working for high tech companies in the Valley, not a single one of my employers has offered 401K matching. I know some do, bu tit is by no means a given.

    Intersting comment Ron made about Social Security – Do public employees get SS tax taken out of their check or not?

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  • JJ, Ron and Nancy have a point. If you look at the City Web Site and the City Council’s response to the Grand Jury, you see that the City have made cuts to salaries and benefits – more so than most neighboring cities.

    At the budget workshops earlier in the year, we heard that City employee salaries in San Carlos are 5% to 10% below the prevailing level among comparable cities – and 25% of the City’s Police Officers have 1 year or less of time with the City. These two facts are clearly related.

    So a question here is, are we “OK” with this? It’s something to ponder….

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  • How about getting rid of Matt Grocott? I think that would help this city turn around.

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  • The city has had increases in salaries the past few years and also increases proposed for next year. This is ridiculous! Also, they have a very lucrative retirement benefits which should be dropped. Finally, the last City Manager proposed that the Asst. City Manager position be eliminated.

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  • While I credit the city for the cost-cutting measures cited in the Grand Jury report and response, I think the city needs to provide greater transparency to address this perception that there’s fat to cut.

    It’s great that San Carlos has taken proactive measures to limit the overall headcount of city employees and reduce future compensation and benefit costs. However, best I can tell, the Grand Jury report doesn’t comment on other metrics that are also important cost considerations. For example, what is the average city salary in San Carlos compared to other areas? Or, while San Carlos has fewer overall staff, what is the ratio of higher compensated staff in San Carlos to other cities (i.e., are we too top heavy)?

    I don’t know the answer to that…my guess/hope is that San Carlos is in-line with other cities in those areas. However, given the public perception that there is waste here, I think the city has to be much more aggressive in communicating real data — simply giving folks a grand jury report to comb through isn’t sufficient. In my opinion, improving public perception requires the city to clearly communicate how management costs in San Carlos compare to other similar peninsula communities. It would be very compelling to clearly demonstrate that San Carlos compares favorably across a series of cost and staffing metrics to Belmont, Burlingame, and other communities we think as peers. On the flip-side, if that comparison shows some cost savings opportunities, by all means it should be on the table.

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  • I think the basic “bottom line” here is that the economy is hurting, costs are going up, people are losing their jobs and houses and our city is knocking on our doors asking for sympathy and MORE money. What is wrong with this picture??

    Why is anything sacred? And why are the residents asked to participate so much in this process of budget balancing? Isn’t that the jobs of those we have elected and pay to make these decisions?

    If any city employees feel under-compensated, you are free to look elsewhere and congratulations if you find a better paying position. But do any of you really think we cannot replace an open city government position with another qualified person in this economy??

    I guarantee you that teachers don’t go into teaching for the money, but there are plenty of excellent teachers out there looking for jobs because they want to do this type of work.

    The same applies to police officers, firefighters, janitors, etc. It is their chosen profession.

    So let’s (city leaders) get back to basics and fix the over-spending problem and find a way to run this city within its means. Cut where cuts need to be made and stop panhandling to the residents.

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  • I’m one of those police officers that left San Carlos for much greener pastures in a neighboring city. Is this the kind of continuity you want in safety services? If you really feel this way towards civil servants, go ahead and replace them all. Better yet, outsource everything to India for a few rupees. Trust me, you get what you pay for.

    No hard feelings, and I still live in San Carlos

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  • Until our management gets our house in order, we may unfortunately lose good public servants. Clearly if neighboring cities can afford to pay better salaries without claiming the sky is falling, then San Carlos needs to figure out its priorities.

    We have a mis-management problem, especially if other cities on the peninsula are not experiencing the same troubles.

    I am aware that the vast state cuts and revenue reductions are felt by all, but some are weathering the storm much better.

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  • Michael-
    I think there are some serious logic gaps in your last post.
    Your post presumes that all things are equal between different cities and the only variable that impacts financial condition is competence of management.
    But clearly there are some critical differences. Specifically, revenue sources are quite different from city to city. If San Carlos captures less in property taxes than neighboring cities, that makes a big difference on a budget. Likewise, if other cities have more hotels, auto rows, etc. to contribute to their budgets, they have an income source San Carlos lacks.
    As I mention in an earlier post, I think we should ensure that management costs within San Carlos are in line with comparable cities. If they’re not, I agree those cuts should be on the table. If they are reasonable, though, I don’t think the solution is to just let people walk and fill positions with cheaper (and potential lower quality) employees. Ultimately, if salaries within San Carlos are in line with other cities and we want the same quality of life and services in those cities, we may need to find a way to raise comparable revenue as those those cities from different sources — whether it’s through utility taxes, sales taxes, parking meters, pay for service, etc.
    The first step is to ensure our management costs are in-line with other cities, and if not, get them there. But if that doesn’t solve the whole budget problem, then citizens need to choose between alternative revenue streams (i.e. taxes and fees) or lower quality city employees and services.

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  • I have lost confidence in the ability of this council and the city management to solve this budget deficit. The first knee jerk reaction is to go back to the tax well. I think the city leaders should use a combination of reducing salaries 10% using 2 furlough days per month and reducing staff and services. I was very interested in the proposed list of positions to be eliminated. All the jobs are lower level positions. I think the management positions should be evaluated for possible savings. Whatever happened to the proposal to eliminate the assistant city manager? Is this an essential position or a luxury we can no longer afford?

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  • A 10% paycut won’t balance the budget either this year nor next year. It’s worth to try out what the No on U people want. Let’s just do away with the current city manager and rehire at 50% current pay. According to quite a few diehards who post here, there’s plenty of people out there who can do the job. Do away with public works, since there’s very little building going on in San Carlos. Could we hire the same building inspectors as independent contractors? We don’t need Saturday maintenance at ball fields like Highland. Let’s make the soccer and baseball parents carry their trash home and clean the restrooms themselves. Why do we need public works personnel to clear the public sewer when there is a blockage due to heavy rain. Call Roto-Rooter! Yes, public employees love to take abuse like as if we’re pigs at the trough. Aaaah,the City of Good Living!

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  • If we make no more cuts, where is the money coming from? Noone on this blog has said that reducing salaries of city workers is going to be the solution but it will help.

    Many of our leaders as evidenced by the Meausre U ballot proposal is trying to fix the budget problem with a silver bullet; this is not possible.

    The problems have multipliedd by many forces so we have to pick this apart and find multiple fixes, not just one.

    But what many in San Carlos want to know is, what have we gotten with our money so far?? You can’t fault people for wondering why some (NOT ALL) of our city employees are making so much money and have such generous retirement benefits when those people have directly contributed to the problems we have now?

    You can’t blame the state for all our woes, or the economy or real estate prices falling…there are multiple problems that need multiple fixes.

    Nothing within reason should be off limits and just like services, city events, etc, city employee salaries are fair game and they have yet to be cut or scaled back. It’s a sad reality that it would be neceesary, but if not, what do YOU, “city worker” propose we do?

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  • I am glad to see the poll results that the vast majority of San Carlos voters want to see the city reduce salary and benefits of city staff.

    I saw the list of positions that the city is looking at cutting. Why are there no management positions on the cut list? I would much rather save 2 line staff positions and cut one expensive management job in order to save some services. Also, hasn’t the city hired some very expensive management employees in the last several years? Why has this information been hidden?

    Also, are the management staff represented by a union? When does their contract expire? I would like to see the salary cuts in San Carlos start with management. Once they have taken pay cuts (as other governments have already done) it will be easier to negotiate with the unions to do the same.

    The city should open contract talks with all unions, even if they are mid contract, to discuss salary & benefit cuts. Some people are misinformed on this site and think this is impossible. It is very possible and something many government agencies are already doing. It comes down to this – either the staff in the city take pay & benefit cuts or there will be more layoffs.

    Finally, if current city staff are unhappy about taking pay cuts, they can choose to resign. There will be many hard working, intelligent people lining up to take their job. Even with pay & benefit cuts, the city jobs will be well paying and secure. Having been a recruiter for a local government for years, I have seen hundreds of people apply for just one entry level government job.

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  • All it is really going to take is to get more people to spend their money in the businesses within our city limits. How about using our .5% lower tax to our advantage? Make sure the surrounding communities know that we have a lower tax rate. Let them come here to save that extra $$$$ when they buy their big screens, kitchen appliances, etc. Then, make sure to remind all of your short sighted neighbors who think it is such a good idea to buy things on line, or at big chain stores miles away, that it is just those decisions that are contributing significantly to the current financial issues. Then, if you still feel the need to propose a tax, try one that at least makes more sense, like the utility tax. At least that way, everybody in San Carlos will be contributing, not just the few who will choose to spend money in town.

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