By Paul Coogan / An Injustice
The City of San Diego is confronting a projected budget deficit of approximately $258 million for the upcoming 2025/2026 fiscal year. Is that the real number and how did this happen?
First off, the $258 million is the shortfall on the operating budget. The real price tag needs to include the deferred maintenance and upgrades to infrastructure totaling $11.87 billion — with a ‘B’. The city has less than half the money to pay for that work and comes up $6.51 billion short over the next five years. Assuming the operating budget is balanced for the next five years, the total need is $6,788,000,000.
Now that Mayor Todd Gloria is saddled with the financial disaster he promoted, he is initiating several measures aimed at mitigating the shortfall: Reassessing office space leases, a hiring freeze, higher parking meter fees, new trash collection fees, and eliminating the position of Chief Operating Officer. Removing the CCO of the city is consistent with the mayor eliminating the City Manager position thus concentrating more power in himself. Authoritarian rule has far less overhead and pesky oversight.
The best-case scenarios estimate $100 million from the parking meters and trash fees. Combine this with the $5.4 million in cuts completed and that leaves only $6,682,500,000 to go.
Most of this is supposed to be paid by Developer Impact Fees (DIF), the state gas tax and various other fees. Some of the shortfall can be attributed to reduced usage income from the gas tax as cars become more fuel efficient and, to be fair, we cannot hold the current mayor responsible for the infrastructure backlog piled up in prior decades but we can hold his feet to the fire for the shortage of DIF funds due to waivers handed out as building incentives under Complete Communities and the Bonus ADU Program.
“Waiver of DIF for all covenant-restricted affordable dwelling units, all dwelling units that do not exceed 500 square feet, and all covenant-restricted dwelling units, all dwelling units earning no more than 150 percent of the area median income that contain at least three-bedrooms and are under one lease agreement, if the development’s residential density is at least 120 percent of the maximum permitted density of the applicable base zone or Planned District.”
— San Diego Complete Communities Information Bulletin #441
The result of this incentive was the rollout of mid-rise buildings composed entirely of studio and micro units. One proposed building touted a savings of $2.5 million. The exact number of units placed on the market and total DIF giveaway are difficult to extract from the piles of permit applications at Development Services but it estimated to be between 26 and 31 million on ADU builds alone, easily outstripping what the mayor is proposing with budget cuts and fee increases onto residents.
“ADUs that are built in San Diego are generally exempt from most DIFs. ADUs of 750 square feet or less DIF are waived while larger ADUs (over 750 square feet), the city applies a reduced DIF rate, which is typically lower than the fees charged for traditional residential development.”
— San Diego ADU Information Bulletin #400
Again, more small-scale micro units unsuitable for families with the cost burden shifted to the residents.
Both programs have been aggressively promoted by the mayor as he “leaves no crisis unleveraged”. The housing crisis has been very lucrative for Mr. Gloria’s campaign fund.
Major donors contributing $10,000 or more to committees supporting Mayor Gloria’s 2024 re-election include:
$800,000 — San Diegans for Fairness — A political action committee (PAC) supporting or opposing state and local candidates and ballot measures in San Diego County. The PAC is known for backing pro-business candidates with contributions from real estate developers and the California Apartment Association Independent Expenditure Committee.
$50,000 — Building a Stronger California (Sponsored by Western States Regional Council of Carpenters) — A labor-backed political advocacy group supporting policies that promote construction jobs and union labor in California.
$25,000 — Monarch Housing Solutions, Inc. — A multi-generation, private real estate investment and development firm, located in La Jolla.
$10,000 — Klein Financial Corporation — A real estate investment and development firm specializing in multifamily rental communities while providing risk adjusted return to investors.
$10,000 — Affirmed Housing Group, Inc. — A San Diego-based for-profit real estate development firm that builds affordable and supportive housing, often working with government subsidies and tax credits.
$10,000 — San Diego Lodging Association Issue Advocacy PAC — A political action committee representing San Diego’s hotel and hospitality industry, advocating for policies that benefit tourism and lodging businesses.
$10,000 — Mark Arabo — A San Diego-based businessman, community advocate, and former president of the Neighborhood Market Association.
Certainly, there should never be a quid pro quo related to political contributions, but it seems fairly obvious that mayor Todd Gloria’s past actions attest to a lack of fiduciary responsibility to the electorate. Now that the chickens have come home to roost with the current budget shortfalls, it’s about to get even worse. The city received approximately $58 million in federal grants in FY-2023 and with Elon Musk in charge we can expect grant renewals in 2025 to come to a standstill.
Sources
Big City San Diego Supporting Todd Gloria for Mayor 2024 – California Payee – Transparency USA
THE ANSWERS YOU NEED ABOUT THE MONEY IN STATE POLITICS
www.transparencyusa.org
Political Action Committee Raises $800,00 for Mayor Todd Gloria’s Re-Election
A political action committee reported Thursday it has raised $800,000 over three weeks to support Mayor Todd Gloria’s…
timesofsandiego.com
San Diego’s infrastructure funding gap surges to $6.5 billion as growing needs outpace money
The five-year shortfall has more than tripled since early 2020. And city officials estimate that projects they’ll need…
www.sandiegouniontribune.com
It is important to know whom our local politicians are beholding to. I am not certain, however, that there was no quid pro quo related activity for these political contributions.
If Supreme Court Justice Thomas can take *4.2 MILLION US DOLLARS worth of gifts over two decades on the Court—nearly ten times the value of all gifts received by his fellow justices during the same time period. Most of those gifts were from his Nazi memorabilia collecting buddy Harlon Crow.
(*Source: https://www.judiciary.senate.gov/press/releases/durbin-reveals-omissions-of-gifted-private-travel-to-justice-clarence-thomas-from-harlan-crow)
If Mayor Adams in NYC can accept all kinds of grift from Turkey’s government and get away with it, well, then why shouldn’t others line their pockets?
Our current POTUS is one of the biggest grifters to ever to grift, what an inspiration to others in politics huh!
Paul Coogan, you are SPOT on. Thanks for enlightening those in the dark. And for those who voted for some more of the same from Toddler, is this what you had in mind when you voted for him?????? On one hand his opponent, Larry Turner, dodged a bullet. On the other hand, the tax payers are really getting fleeced.
With all these property improvements, you’d think record assessments would put some money back in the pot.
‘You get what you vote for’. The fact that San Diego is running into what looks like over a Trillion dollar projected need, ( according to this article), is directly related to policies created and enforced by Todd Gloria and company. I agree with Chris, there should be an overflowing pot of silver and gold in the city’s treasurer, based on the building that was incentivized and ‘permitted’. Instead, the empty pot needs to be filled. By Whom? Our own pockets, where taxes are seeded, germinated, and grow. We are the government’s money tree.
Let’s not forget all the funds siphoned off for homelessness and immigration services and housing.
The state has spent $37 billion, yes billion, on homelessness since 2019.
No solutions or accountability required
Great piece Paul!
Are Los Angeles Mayor Karen Bass and San Diego Mayor Todd Gloria in the same club, reading from the same playbook?
We hate to have to compete with San Diego for one of the worst-managed cities in California, but we here in LA can’t wait for Bass to announce her budget next month when LA may snatch this dubious honor away from you!
From LA Times (March 19th, 2025): L.A.’s financial problems exploded into a full-blown crisis on Wednesday, with the city’s top budget official announcing that next year’s shortfall is now just shy of $1 billion, making layoffs “nearly inevitable.”
Overspending + deficit = disastrous for citizens and residents.
Who is minding the store? No one would spend their own money this way. People everywhere should be up in arms.
Every person reading your article should immediately send a letter and/or email to the Mayor Gloria, and to his or her respective SD councilmember demanding accountability. Send them a copy of Paul’s article. Show up at the next budget meetings, whether committee or full council. Start petitions to recall him and anyone who goes along with his lack of fiduciary responsibility. He is selling residents out, when he and government exist to protect the citizenry! This is incredibly irresponsible leadership. If you permit it to continue unchecked, you (dear reader) become part of the problem.
Thanks for writing this Paul.
Good luck!
Mayor Bass, unlike Gloria, has grassroots background.