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City reserve raised to 14% at recovery turning point

Recovery budget work continues at City Hall.
Recovery budget work continues at City Hall.
Adam Benjamin

San Diego stands ready to take on emergencies and givee residents full services. A raise of the city's reserve to 14 percent aproved by the budget committee the city council will make history guarantees the city government will not turn back in its recovery.

City finances have stabilized.

"While the Reserve Policy calls for 8% reserves, the city's fiscal discipline has resulted in a reserve level of more than 14%," Interim Mayor Todd Gloria said last Wednesday. The reserve amount will increase to 150 million dollars. "These revisions would require that lvel going forward and will ensure long term stability for San Diegans ability to serve our citizens with necessary services."

Budget roadblocks can now fall short on forcing the city to settle for giving citizens a lowered return on their taxpayer investment. Gloria welcomed an end to the city's budget troubles. "Thanks to the ongoing focus and discipline of city leaders, San Diego has come a long way since the financial challenges of the last decade."

Raises in city budget spending, that do not result from a city decision to yield to an emergency, do not use reserve funds. The strong policy, according to the Mayor, eases service delivery risks. While guaranteeing a good bond rating.

Decisions to fund budget shortfalls will stay within reach. Reserves that the policy does not allow to fall below 14 percent the general fund revenues give the city spending money when spending needs go above the share of city revenues the city needs for the year. In addition to the General Fund Reserve that guarantees citizens get the return on taxpayer revenue they paid for, the reserve has an Emergency Reserve and a Stability Reserve. THe EMergency Reserve prevents budget dips during public emergencies, such as a natural disaster or an unforeseen catastrophic event.

Extraordinary risks to financial stability and service delivery the city expereinces during an economic downturn, or a one time expenditure the city did not anticipate, will not reach a level the city goes on warning as long as the Stability Reserve stays funded.

Cuncilmembers are scheduled give a February approval on the 14 percent reserve. City leaders will have a fully secure budget when they enter discussions on the city's mid-year financial report during the February month.

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