San Diego officials announced this week that the city has eliminated its roughly $300 million structural deficit and can balance next year’s budget without additional cuts or new revenue, after two years of budget cuts. But the celebratory tone clashed almost immediately with an independent assessment: just days earlier, the city’s own independent budget analyst said the gap had shrunk but had not actually disappeared.
City finance officials released a new five-year financial outlook Friday declaring the deficit gone, according to the San Diego Union-Tribune. Gloria announced a plan three years ago to incrementally eliminate the deficit. The city says the next fiscal year’s budget can be balanced without any additional cuts or new revenues, a notable claim after two straight years of budget gaps well over $100 million.
Independent budget analyst Charles Modica offered a more cautious read just days before the city’s announcement. In a report cited by Voice of San Diego, Modica said the structural deficit has shrunk over the past two years but has not been fully eliminated — a direct contradiction of the mayor’s declaration that leaves the true state of the city’s books an open question.
How the City Says It Closed the Gap
City finance officials attributed the elimination of the deficit to three main moves: $180 million in cuts, $80 million raised by starting to charge for trash service, and $63 million combined from a hotel tax increase and an opioid settlement, per the Union-Tribune’s reporting. The city has relied on one-time resources amid structural imbalances…