The Truth About the City's Finances

By Lesa Heebner

Response to Misleading Campaign Mailers

Dear Friends,

Campaign mailers have been sent out with blatantly false information regarding the city's finances. I'd like to set the record straight. The city's finances are healthy, they are well managed and the council has made prudent decisions to safeguard taxpayers' money.

Below I've laid out the facts. I quoted the false claims directly from the Powell, Frankel and Driver mailer, followed by the real facts:

They say we have "...unsustainable pension costs..." FACTS: Solana Beach was the first city in the region to implement full pension reform for all employees--meaning employees are now paying the highest employee share of their pension costs as allowed by the state, AND we lowered benefits to the lowest available at the time by the state--saving Solana Beach taxpayers $7 million over the next 20 years.

They say we were "...forced to borrow $3 million to cover increased employee pension costs ..." FACTS: As part of our pension reform actions, the city chose to pay off a $3.1 million unfunded pension liability run up by previous councils, saving the city $1 million over 12 years. Using funds that were earning less than ½% interest, we paid off a high interest (7.75%) liability AND we will pay ourselves back, plus 2 3/8% interest, over 8 years. Again, we are saving the city $1 million by doing this.

They say we have "...chronic budget deficits..." FACTS: When the council saves up for, say a fire truck, we put these dollars into a "designated reserve account" (savings account). When we buy the fire truck, the amount in this account is drawn down by the purchase price (duh). This is not a deficit, which is what they are alleging--it is spending purposefully saved funds on improvements for the community. These accounts are constantly being replenished in anticipation of new expenses and spent when needed. When I hear "deficit", I think of "not enough money". In fact we did have small deficits in 2 of the past 8 years. At the bottom of the great recession, we had two years of approx $350,000 in deficits (2009 and 2010). This was 3.6% of our General Fund reserves at the time, and 1% of our current total reserves. We used our rainy day fund to balance our budget, and here we are in 2012, back in the black again, reserves replenished.

They say we "...spent half a million to defend reckless decisions..." FACTS: Groups and individuals can sue. In 2010, the city was sued by an individual falsely claiming city sewer pipes leaked and caused damage to his property. We could have lost over $2 million. We hired attorneys and experts to prove this was not the case. This cost $750,000 over the last two years. We won the lawsuit on all counts. And we will recover at least $500,000 in fees from our insurance coverage. You can't stop people from suing, and when they do, we need to defend the city. We have won each case, saving taxpayers hundreds of thousands of dollars in payouts.

They say we are "...mortgaging our future...on the Highway 101..." FACTS: This investment in our future has already resulted in increased property values and will stimulate private development, more than paying for itself in increased sales and property tax revenues. We are creating an economic engine for our city. If we had waited to pay cash for the Highway 101 project, it would have been another 20 years of empty lots, crumbling or NO sidewalks, no handicapped accessibility, dangerously aging water pipes and very few places to eat or shop. Historically low interest rate Build America Bonds, issued to stimulate the economy, were a golden opportunity to finance this project--to be paid back with dollars that were already coming to us--to help businesses and to improve our tax base.

They say my solution is to "...increase our taxes and fees..." FACTS: All tax increases must go to a vote of the people. I can't raise them; only you can. As far as User Fees, cities are required to have independent third party analysts assess the actual cost of providing city services. In reviewing the analysis, we did raise some fees ... in order to cover the costs of providing the service ... so you would not be paying for your neighbor's grading permit fee. This is a "pay as you go" philosophy.

We have independent third party auditors review our books every year. We change auditors every 3 to 5 years to ensure fresh eyes are reviewing them. We have never had a "black mark" on our audits. Our city is in excellent shape and we have made prudent and forward-thinking decisions, safeguarding your dollars and our future.

It's very important to point out that these were 5 - 0 votes...from a council with very different points of view. Joe Kellejian, Dave Roberts, Mike Nichols, Tom Campbell and I all voted for all of the above.

I don't mind disagreeing on issues. I don't mind differences of opinion. But I do mind twisting the truth and flat-out lying. These candidates had a chance to participate in the Candidates' Forum to air our differences. But they chose not to attend. I believe this was disrespectful to the public and to the democratic process. Instead, they now hide behind falsehoods on slick, glossy big-city-tactic campaign mailers, launching accusations in order to scare you into voting for them.

My hope with this lengthy note is to help you distinguish the sense from the nonsense. Please don't be misled by these people. I have worked hard and smart for you and would like to continue to do so. Please cast your vote for me! If you have any questions, feel free to email me or call me at (858) 755 7757.

Regards, Lesa

PS Please share this with your friends by directing them to my website, http://www.lesaheebner.com