Given the sorry state of San Francisco’s streets, it’s not surprising that voters approved Proposition B, the $248 million bond measure to repair streets and sidewalks.
This is, of course, good news for The City’s 850 miles of roads and sidewalks. In the next few years, $148 million will be spent for street repaving, $50 million for pedestrian and bike safety enhancements, $20 million to improve Muni’s traffic signal infrastructure and $22 million in disability access upgrades.
The bad news is that bonded indebtedness is a wasteful way to provide for basic maintenance. Interest from the loan will cost taxpayers an additional $189 million. In other words, more money ($41 million) will be spent on servicing the debt on this road repair bond than will be spent on repairing roads.
Passage of the bond has sent the message to city officials that they can limit spending for basic services such as fixing potholes, knowing that voters will bail them out at election time after the problem gets so bad they can’t take it anymore. In effect, city officials are rewarded for doing a bad job — a perverse strategy that appears to be working.
A recent city survey revealed that only 34 percent of residents approve of the job The City’s government is doing in providing services — a decline from 43 percent in 2009. Only 31 percent are satisfied with city streets, sidewalks and infrastructure, which is significantly below the average of 44 percent satisfaction in five comparable cities.
Fiscal mismanagement, as exemplified by using bond debt for services that should be provided from the general fund, can hurt the credit rating of a government, making it more expensive to borrow money when it’s truly needed for large-scale projects such as the Central Subway. San Francisco’s credit rating is good, but there’s no guarantee it will last.
“Maintaining the strongest rating of any California county requires our continued and steadfast commitment to tough financial management, sound budgeting and fiscal prudence,” former Mayor Gavin Newsom said last year.
A city and county budget of $6.8 billion, nearly half of which consists of the general fund, should be able to provide for street and sidewalk maintenance. The failure of city officials, including during the Newsom administration, to do so shows a lack of financial management, sound budgeting and fiscal prudence.
Fortunately, voters rejected another attempt by officials to pass the buck in the recent election, with nearly 54 percent opposing the half-percent sales tax hike. It’s time that city officials get the message: Government must learn to live within its means.