SLO council members send mixed messages on worker cuts

City of San Luis Obispo employees — already being asked to forgo millions in future pay and compensation — will not be asked to give up more.

That is not to say some on the City Council didn’t want to go there. Asking their staff to bear more of the financial pain has been an idea some council members have talked openly about in public venues recently.

The five members of the City Council reached consensus Thursday on the proposed general fund budget for the upcoming two fiscal years, which includes $1.8 million in operating cuts and $2.6 million in expected cuts to employee compensation.

However, earlier that day at a luncheon with an association of San Luis Obispo property owners, Councilman Dan Carpenter said he would advocate for more cuts to employee compensation to help balance the budget. Then that night at the meeting where city workers were in attendance, he remained silent on the subject.

“Even though the cuts didn’t get as high as I thought they were going to, I didn’t think last night was the place to bring it up,” said Carpenter, who acknowledged that he might have sent mixed messages.

Carpenter said he was willing to support more cuts but was waiting for someone else — such as Councilwoman Kathy Smith or Councilman Andrew Carter — to propose them first.

All three council members have advocated for more stringent cuts to balance the budget — resulting in $500,000 more being asked from employees than originally proposed. That figure grew from $2.1 million to $2.6 million. Those cuts may be made by cutting wages or asking employees to contribute more to their health benefits and pensions.

Smith, who also attended the San Luis Obispo Property Owners Association luncheon prior to the council meeting Thursday, told the association she wasn’t satisfied with the cuts, either.

“I was waiting for someone else to bring it forward,” said Smith, referring to Thursday night’s meeting. “I wasn’t feeling strongly enough about it to initiate it but would have probably joined in had someone else brought it forward.”

Carpenter said he will push for more cuts once negotiations begin with the city’s employee bargaining groups.

“Either these concessions will be made or positions will be cut,” Carpenter told members of the San Luis Obispo Property Owners Association.

On Friday, Carpenter said he stood by that view.

The city faces a $4.4 million shortfall in its $54 million annual general fund for the fiscal year 2011-12 that begins July 1. That shortfall will grow to $5 million in 2013-14 and is projected to be $4.7 million annually for each of the next five years without the expected cuts.

Employee costs account for 79 percent of the city’s general fund. A recent study found that San Luis Obispo has about the same number of employees today as 10 years ago, but it is paying double for their salaries and benefits, mainly because of the increased costs of pensions.

Smith said Friday that she would prefer the concessions come from employee benefits by asking city workers to pay more for their health and retirement versus implementing layoffs.

“Those of us who wanted further cuts got them — by $500,000 — and that is significant,” Smith said. “We might have wanted more, but we certainly didn’t talk about it.”

Stephen Barasch, treasurer of the San Luis Obispo Property Owners Association, said he wasn’t surprised by the mixed messages.

“Politics are politics, we all know that,” Barasch said.

Barasch said his biggest concern was that the council balanced the budget without passing on additional fees to residents.

“Stop increasing existing fees and creating new ones,” Barasch said, “because taxpayers are broke, and the public is fed up.”

Additional budget workshops will be held Thursday to discuss capital improvement projects and June 14 to discuss enterprise fund operating programs such as water, parking and transit.

Final adoption of the 2011-13 budget is expected June 21.

Reach AnnMarie Cornejo at 781-7939. Stay updated by following @a_cornejo on Twitter.