Mega-shelter, equity programs, ‘Fatal 15': Here's what made and missed the $5.8B city budget

The San Diego City Council Tuesday passed the city's $5.8 billion budget for the 2024-25 fiscal year, reflecting significant modifications to Mayor Todd Gloria's initial proposal.

The budget passed includes May revisions to the initial March budget, but also recommendations from the city's Independent Budget Analyst. The budget passed Tuesday represents a nearly 12% increase over the $5.12 billion budget for the 2023-24 fiscal year.

March's initial $5.65 billion budget proposal received mixed reviews from the San Diego City Council and the public, which called out cuts to equity programs, police and fire academies and some parks and libraries.

Here's where the funding is going:

Homelessness & possibly a new mega shelter

One aspect of the budget passed Tuesday does include contingent allocations of $6 million in Community Development Block Grants for a proposed 1,000-bed shelter at Kettner Boulevard and Vine Street in Middletown -- a shelter which has not only not been passed, but has not had a public hearing.

Councilwoman Vivian Moreno supported the budget's restoration of equity programs, but balked at the shelter proposal.

"The funding was always available for these programs, we just need to prioritize it," she said. "We heard loud and clear from the public that the proposed budget did not reflect their priorities.

Homelessness advocate Rachel Hayes also applauded the $28 million approved to tackle the issue but was against the proposed and not-yet-approved mega shelter.

“A 1000- bed shelter, in my mind is a disaster,” Hayes, who lived for 10 years unsheltered, said. "If I was asked to go into the shelter would I go or would I stay on the streets I would often stay on the streets I cannot be in a shelter with 1000 other people."

A city spokesperson told NBC 7 the facility will cost $18 million to renovate and then $30 million a year for operation. If the project is approved, the city expects it to be open and operational by early 2025.

“We continue to negotiate aggressively on behalf of San Diegans as we consider new and impactful solutions to address homelessness," the mayor and city council president wrote in a joint statement. "All of us recognize leaving people on the street is inhumane and bad for everyone, including our housed residents, and we must continue to act with urgency to end this crisis."

Equity programs stayed

Through a public engagement process which several councilmembers called the most "robust" they had seen in decades of service, many cuts which likely would have impacted less affluent areas disproportionately were ultimately rolled back.

Items added Tuesday include $8.4 million general fund expenditure modifications such as $3 million for the city's community equity fund for Jan. 22 flood victims and $1 million for a youth care and development program. These additions were offset by $8.4 million in revenue sources, backed up as realistic by San Diego's Independent Budget Analyst Charles Modica.

"It's challenging to continue to show up advocating for essential needs for our community," said Councilman Henry Foster III. "It has been said throughout this process that this budget should not be balanced on the backs of those who are less fortunate. That's why my colleagues and I have fought hard to make sure that this budget is balanced and provides for the needs of all communities.

"I'll be the first one to say that no one will take better care of us than us."

"It's a tough budget season, but as we have said throughout the process, just because it is tough doesn't mean that it needs to be toughest on those who have the least," Council President Sean Elo-Rivera said. "We are doing the best that we can in a tough situation and that is something I can be proud of."

Fatal 15 Intersections

Councilman Kent Lee, who heads the council's Budget Committee, said the budget includes funding for the Housing Instability Prevention Program, an eviction protection program, studies on the "Fatal 15" intersections which represent San Diego's deadliest 15 intersections for pedestrians and cyclists and the Your Safe Place software licenses for domestic violence case management.

"That we would allocated CDBGs to the shelter when there has been no discussion does not sit right with me. This proposal is far superior from the mayor's proposed budget but it in no way signals support for the 1,000-bed shelter," Moreno said.

What was left out?

Since the initially proposed budget, Gloria took other actions to save money, including suspending non-essential spending in city departments, as well taking action to ensure the city is filling "only the most critical positions" before the end of the fiscal year.

Additionally, Gloria proposed sweeping balances from some special funds into the city's general fund, suspending contributions to reserves and using one-time measures such as requesting that the San Diego Housing Commission use $15 million in its reserves to partially fund existing programs.

According to Modica, the cuts in this year's budget are planned as one-time slashes to the budget, but next year may see more significant, permanent cuts unless San Diego can secure another source of revenue.

Councilman Joe LaCava thanked his colleague for having an open discussion of priorities but also the mayor for providing a budget in the spring.

"The budget is never static, it is always evolving. The initial budget, which a lot of people didn't like, was based on the best information we had at the time," he said, describing it as a much bleaker picture.

Additionally, LaCava also noted that despite the January storm and the months of budget review following, no one had been asking for more stormwater funding or capital improvement projects.

"Stop getting mad at the mayor and start getting mad at us," he said to the public watching the meeting.

The budget will need to be finalized with a second reading before June 30.