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April 27, 2020

Comments

Phinancier

Before we end up with a BBB rating we better reopen the Three B's. Behan's, Barrelhouse and The Bull. Drink up, Burlingame.

SnitchDoor Sam

SnitchDoor Sam is loving this bit of BS from the San Mateans.

San Mateo officials have come up with a plan to address a $7 million structural deficit brought on by COVID-19 without significantly affecting service levels or laying off employees — for now.

“I don’t want to see services cut or have employees be cut so this is certainly the lesser of certain evils, no question about it,” said Councilwoman Diane Papan. “We’re each going to have to do our part.”

But the proposal is not yet a done deal as employee bargaining groups have yet to agree to it. If bargaining groups do not agree to the proposal, then officials will attempt to secure $3 million in savings by restructuring employee compensation in some other way, an official confirmed after the meeting.

Joe

You read it here first three weeks ago, but here is the Daily Journal synopsis of the Wednesday study session:


Plummeting airport traffic and vacant hotel rooms gutted a main source of income, according to a presentation from Finance Director Carol Augustine, who projected significant transient occupancy tax losses.

Burlingame should expect about $16 million in hotel tax in the next fiscal year, down from $20 million the year before and $29 million the year prior, according to Augustine’s projections. She said discussions with hotel executives fueled expectations the industry could see some recovery over the coming months.

In all, income to the city’s general fund was projected to hit $66 million in the coming fiscal year, down from $69 million in the existing year and $84 million the year prior.

Additionally, Brownrigg suggested some of the revenue projections did not accurately reflect the losses he anticipated will occur.

“I am concerned our scenario is probably too optimistic,” he said.

Much of the initial budget crunch is expected to be covered by a reduced capital improvement plan, from which $8 million was drawn.

https://www.smdailyjournal.com/news/local/burlingame-s-budget-bruised-by-pandemic/article_fd732094-98af-11ea-9b86-1f7e496bd787.html#utm_source=smdailyjournal.com&utm_campaign=%2Fnewsletters%2Fheadlines%2F%3F-dc%3D1589810408&utm_medium=email&utm_content=headline

I've got to agree with Michael Brownrigg on the optimism reflected in some of the forecasts. Much better to be safe than sorry.

Bruce Dickinson

"Much better to be safe than sorry... " Something not in the historical vernacular of the City of Burlingame with $60 million dollar rec centers, pool funds going down the deep end, and to think there was a even a proposal to build a new City Hall when the current one is completely sufficient (and underutilized now that future meetings will be Zoomed!).

Let Bruce Dickinson say this again: Being levered to real estate, tourism and retail sales can create a lot of volatility in income streams. Forget about COVID. The same happened in dot.com bubble burst, the same thing happened in the great recession of 2008. And it's not just Burlingame, it's also the state of California. Not 3 weeks into the COVID crisis, and the state is already running billion dollar deficits!

Guys, take it from me: if your earnings are volatile, you HAVE to have a balance sheet that will pull you through the the cycles. And that's only the revenue side of the equation! Look at the underfunded pensions and benefits that Burlingame (and so many other cities) have to pay, thereby understating the true leverage of the City's balance sheet, not to mention that the City's cost structure (due to these pay as you go liabilities) isn't that variable. The Rec center proposal should be scrapped and replaced with a far more reasonable $25-$30 million dollar rec center that should at most cost $500-$600 per square foot (which is still generous for something that serves a utilitarian purpose and doesn't need a lot of bells and whistles).

Since everyone is in a generosity mood with the GoFundMes floating around, how about Burlingame's real estate developers and architects, who have benefited tremendously from the government and residents here, to give back and donate some of their time/labor for this new rec center!!??

Anyway, on a tangential note, I think Bruce Dickinson's ideas and influence are really starting to hit home, given this trend of others on the BV starting to refer to themselves in the third person. As they say, imitation is the sincerest form of flattery!

Notwithstanding this, there really is only ONE "cock of the walk"!

Once you start wearing your gold-plated diapers you will have also learned this: Reputations are earned, not automatically granted!

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