Mayor Gloria in State of the City: We Will Tackle Fiscal Challenges and Keep Moving San Diego Forward

FOR IMMEDIATE RELEASE
Jan. 15, 2025

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ATTACHMENT /LINK:
2024 Progress Report

SAN DIEGO - In his 2025 State of the City Address, Mayor Todd Gloria laid out his vision for navigating through one of the most challenging financial periods for the City of San Diego in recent years while continuing to make progress on the priorities that matter most to San Diegans: keeping neighborhoods safe, reducing homelessness, building more housing, and fixing the roads.

Speaking from City Council Chambers at San Diego City Hall, Mayor Gloria was forthright in acknowledging that substantial progress would be more difficult after Measure E - the proposed sales tax measure voters considered this past November - failed to secure enough voter support. He and the City Council must solve a $258 million structural budget deficit.

Pointing to his past experience as a City Councilmember, City Council President and Budget Committee chair, the Mayor struck an optimistic and action-oriented tone, calling this moment an "immense challenge" but also an "immense opportunity" to reimagine how City Hall delivers and meets the needs of residents.

"I refuse to be pessimistic about our future. We are a city of innovators, of dreamers, of doers. San Diego's story has always been one of resilience, determination and reinvention," said Mayor Todd Gloria during the address. "And so, this is not the time for retreat. This is not the time to slow down. It's time to double down!"

In order to address the deficit, the Mayor detailed immediate steps he has taken to cut spending - freezing hiring for all but the most essential positions and halting non-essential spending, among other mid-year adjustments.

He is also evaluating the City's leases of office space to determine if it's cost-beneficial to terminate or renegotiate leases and consolidate space. He also has asked each City department to totally rethink their operations with a keen focus on the core service it is expected to provide to the public.

"I believe you want a city government that makes the most of what we have, prioritizes the basics and delivers results," Mayor Gloria said. "And in that, we must acknowledge a fundamental truth: We can no longer do things a certain way simply because that's how they've always been done. The task ahead ... is to right-size our city budget - not just for this year, but for the long-term. It means matching up our resources with our priorities and making hard choices, including reducing or eliminating some city services.

Mayor Gloria said that, given the unlikelihood of significant additional revenue in the coming years, the responsible approach is to solve the City's structural budget deficit in 2025, rather than relying on one-time measures.

"It is my expectation that we handle this structural deficit this year. No gimmicks. No Hail Mary passes," he said. "No cavalry is coming to save us. We can't wait for yet another revenue measure that might fail. We certainly can't count on assistance from the federal government, which under the incoming administration is far more likely to burden us than to help us."

The Mayor said he will remain focused on his four core priorities - building more housing, addressing homelessness, repairing roads, and keeping San Diegans safe - albeit within a tightly constrained budget.

Zeroing in on homelessness, he noted that since he took office as Mayor, City-funded programs have served more than 25,000 people and successfully placed nearly 4,700 into permanent housing, while the Unsafe Camping Ordinance passed in 2023 is successfully reducing encampments in heavily impacted areas without widespread arrests.

Mayor Gloria vowed to continue to increase shelter opportunities in 2025.

"Hear me on this: Even with our difficult financial picture, we will increase options for people to get off the streets this year! We will open a new Safe Parking site at H Barracks, as well as other new shelter facilities," the Mayor said. "Because there are people who are still suffering out on our streets, sidewalks, and canyons each and every night and they need our help. So, whether you're a community member or a member of this City Council, understand that we are going to do more, we must do more, and I welcome your partnership to reduce homelessness, not your opposition."

However, Mayor Gloria said pointedly that homelessness is a regional crisis, and addressing it is not solely the City of San Diego's responsibility.

He called on other cities to step up and create more shelter options.

"It's long past time for all the cities in this county to do their part and not simply rely on you, the taxpayers of this city, to continue to foot the bill."

He also called on the County of San Diego to do more, particularly when it comes to providing behavioral health services.

"Mental health and addiction are often at the core of homelessness," Mayor Gloria said. "And behavioral health, mental health, and treatment for substance use disorders are all services that are supposed to be provided by county government. The City of San Diego does not have a Health and Human Services Agency. But the County does."

The Mayor noted that the County Board of Supervisors voted to delay implementation of Senate Bill 43, the state conservatorship law that makes it easier for people suffering from severe mental illness to access life-saving care. He said that while the County finally allowed the bill to take effect at the beginning of 2025, it did little in its one-year delay to prepare for implementation and has yet to take meaningful steps to address the shortage of behavioral health care beds.

"We cannot afford to absorb the impact of their inaction any longer," Mayor Gloria said. "My fellow San Diegans, it is my hope that, anytime you see a person on the street suffering from extreme mental illness or addiction, you think of the County of San Diego and ask them: When will they step up to provide the services needed to end this crisis?"

The Mayor also called on the state agency responsible for maintaining the land along San Diego's freeways to clear the dangerous encampments that have taken hold in these rights-of-way and clean up the tons of garbage they produce.

"To be clear: I'm so passionate about this because it affects the bottom line at the City. Every dollar this City spends responding to the lack of action from other cities, the County, or the State is a dollar not being spent on fixing our roads, upgrading our stormwater systems or supporting public safety," Mayor Gloria said.

On housing, the Mayor celebrated the success of measures he's taken to produce more homes that San Diegans can afford - through initiatives like Bridge to Home, his two executive orders to speed up permitting, and his two Housing Action Packages.

He noted that, for the better part of the past two decades, the City had issued an average of 4,300 permits for new homes per year. In 2023, as his policy reforms took hold, the City permitted nearly 10,000 new homes. He announced today that in 2024, the City permitted roughly another 8,500 new homes despite high interest rates and inflation creating unfavorable conditions for housing construction nationwide.

Mayor Gloria said today that his policy focus would shift in 2025 toward creating more homes for sale.

"In the coming months," he said, "I intend to announce a new program to incentivize the construction of new starter homes like row homes, town homes, and condos - homes that can bring first-time homeownership opportunities that create generational wealth for San Diegans."

A transcript of the speech and an annual report detailing the City's progress on key issues are available at SanDiego.gov/SOTC.

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