To borrow a line from Game of Thrones, as regards the City of Irvine’s current financial problems, “winter is coming.”
And after observing the city council’s efforts for the past three months to address this critical issue, I and other citizens are asking, is the city prepared for winter? My answer: maybe.
On September 22, the council took decisive actions towards filling the predicted $37 million hole looming in the 2027-28 budget. It approved a plan to raise city revenues by $10 million, froze most hiring, and set a target of saving $17 million by reducing the number of city employees by 31 persons by July 2027 and another 24 by July 2028. The council also identified another $10 million in program/operational cuts. But the council tempered the personnel reduction plan by keeping police officers off the layoff list. It also did not identify where job cuts would take place if attrition doesn’t produce the target number of job reductions.
This measured response to solving the deficit continued on October 13 when City Manager Sean Joyce asked for a single budget reduction: $677,000, the cost of CiclioIrvine, a half day celebration of biking staged last summer. I was disappointed by some council members’ agonized reaction to the proposed cut–one might have thought from their demeanor that Joyce was proposing to burn down a section of City Hall.
The CicloIrvine is part of the Citywide Events budget of $2.272 million. It is clearly a council favorite, as individual members lamented the possibility that any of the other 18 annual events might be downsized or eliminated. The focus on CiclioIrvine stimulated Mayor Larry Agran to wonder out loud how all the special events garnered just $188,000 in sponsorships last year.
“It is frankly ridiculous in a city with multimillion dollar, extremely successful companies,” that the donations were so small, he said. Agran suggested that it was the responsibility of he and his fellow council members to “be in touch” with the city’s top 20 businesses “to get a commitment of $100,000 a year and they can then sponsor whatever event they want.” Having administered charitable budgets for a Fortune 500 company in a past professional life, my unsolicited advice to the mayor on this matter: keep your expectations low.
Councilman James Mai echoed the mayor’s sponsorship opinions and doubled down: the city, he opined, “should stop being prudes” and consider revisiting its ban on sponsorships from purveyors of alcohol, casinos and gaming. Bud Light Balloon at the Great Park, anyone?
And Councilwoman Betty Martinez Franco proposed that the Irvine Chamber of Commerce assume the $35,000 cost of the annual State of the City event. No indication the Chamber was consulted prior to being offered up as a potential donor, or if in return for funding it they get to make the speech instead of the mayor.
After more than an hour of discussion, the elimination of CicloIrvine was adopted, Councilman William Go dissenting. That’s $677,000 down, $36.4 million to go.
My take on the council’s budget strategy is this:
First, let the city manager implement as many of the modest budget reductions, cuts, and reallocations spelled out in the staff analysis as he can. All together that could total close to $10 million.
Second strategy: hope and pray that dozens of current city employees resign or find a new job before July next year (there are currently 68 vacant job positions at the city).
Third strategy: put off any further consideration of the budget until February, when updated data on revenues might provide additional breathing room.
I respectfully suggest some additional actions, based on my belief that city residents want to see the council take immediate, meaningful action on the budget, if for no other reason than to demonstrate a willingness to make tough choices later. My recommendations:
- Reduce your own costs. Lower the budget for council aides to one full time aide per councilmember, two for the mayor. Savings: $1.3 million.
- Eliminate the annual allocation to the Irvine Unified School District, half of the allocation to the Barclay theater, and half of the $80,000 annual grants the council controls. Savings: $4.9 million
- Reduce the special events budget to $500,000, savings $1.1 million.
- Direct each department head in the city except public safety to analyze how the department would function with a 3.5% budget reduction. This will provide transparency both to residents and employees and give a real-world indication of what actual budget cuts would mean.
- Direct the city’s human resources department to develop an employee early retirement/severance package plan for council consideration. Some city employees with more than 30 years of service can retire at age 55 at close to 90% of full salary. Doing the math on short-term cost versus longer term savings should be relatively straightforward.
- Direct the Director of Public Safety to analyze how a 2.0% cut in the department’s $107 million budget would impact service. This would be the ultimate tough call for the council, touching the third rail of city policy and politics. But the sworn police force/civilian budget accounts for nearly half of the city’s General Fund spending–at some point, it may realistically be the only place left for meaningful budget reductions.
The city has done its residents a tremendous service by spelling out, in great detail, the city’s financial status. Readers can find it in the agenda packages for the September 22 council meeting, as well for the October 13 meeting. Both can be easily accessed on the city website. Of particular interest: every city employee’s position (not by name) shows the total cost–salary and benefits–thereof, from the lowest (Accounting Technician $84,901) to the highest (City Manager $763,000)* and everyone in between. Anyone interested in City of Irvine finances is advised to study these documents carefully.
*Sean Joyce was hired August 10 as city manager on a one-year contract at $434,000 per year. The figure cited above reflects what a full-time city manager would have been paid under normal circumstances.
Michael Stockstill has lived in Irvine for fifty years. He is the co-author of two books on local history.
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