♪♪♪ Scott: With a projected $60 million shortfall, the city of Sacramento's new budget may have significant impacts on residents, particularly for the city's youth.

Joining us today are two guests with unique perspectives on this topic, former councilman, Jay Schenirer and deputy city manager of finance Leyne Milstein.

Leyne, describe the fiscal conditions facing the city of Sacramento and the significance of the decisions that the city is going to have to make in the coming weeks.

Leyne: Thank you, Scott.

You know, this isn't a surprise to anybody.

We've been projecting this deficit, um, for a good year, knowing that the costs of city services continue to climb.

And while our revenues are continue... continuing to grow, they're just not growing fast enough to cover the growth of our costs.

And these are our costs to provide core city services that all of our residents have come to expect and depend on.

Police, fire, parks, youth, um, code enforcement.

So we're really challenged this year, and I'll be honest, it's 66 million, so a little bit bigger, uh, that it is a challenge because we really need to focus on those services for which we receive funding and those services for which our residents expect that we're going to deliver to them.

Scott: Okay.

Jay, as the former city councilman who championed a number of programs over the year, but one in particular was the creation of Ride Free RT.

What was your original intent and goal behind establishing free transit for youth in Sacramento?

Jay: Well, first of all, thank you for having me.

I think there's a few things going on here.

What we really wanted to do and I want to go back to our former former former mayor, Joe Serna, who said, you can't have a great city without great schools.

And having great schools means student success.

And there are multiple factors that goes in to whether or not a student would be successful.

Here, getting to and from school having that ability was the main piece of what we were trying to do.

And we spent about nine years getting to the place where we had free transit for young people anywhere, any time.

Also, goes beyond school to after school programs to getting to and from work.

And there's a host of other factors that I think benefits the city, here.

And so we can certainly talk about those as well.

But I would say really supporting our young people to have a successful career, school and career.

And that starts off with being able to get where they need to go.

Scott: I hear you on that.

But I do have to ask you the question.

You have been identified as somebody who really cares about a number of the programs that serve youth.

And this one in particular is one that is, um, under consideration for being cut.

But given what Leyne was sharing at the -- uh, a few minutes ago about that, while revenues are growing, the needs and the costs are are growing faster, you know, doesn't everything have to be on the table um, in order to to make the tough decisions?

Should there be, you know, areas that just are untouchable?

Jay: Well, I think it's really a matter of priorities.

And that's where we probably differ or where I differ from those who are running the city at this point.

I think that the people of Sacramento have clearly stated that youth are our priority.

I think that, you know, it's really important that we look at our budget and say these are our values.

And so coming forward and saying we're going to eliminate this million dollars that we fought for years really to to get into the budget.

And we have a wildly successful program.

I think we also need to look at our - Scott: You say - Yeah, I was going to say, you say it's wildly successful.

What's your evidence of that?

Scott: So when prior to COVID and prior to this program, RT was doing about 1.5 million rides per year for young people.

This year will be finishing up June 30th at about 4.2 million rides.

So you've got about two and a half times the amount of students that are riding.

Now, we can start if you want to go into the benefits on this when we talk about public safety.

Scott: Yeah, I do, actually.

Yeah.

So let's talk about public safety.

Kids can get to where they need to be.

Let's talk about climate.

If we can get people out of their cars and particularly for young people, change culture and habit so they become lifelong transit riders.

That's a huge benefit to the city and helps us meet our climate goals that the city has put forward.

If we talk about traffic congestion, the more young people we have out of their cars and on to public transit, the least -- the less traffic congestion that we have.

We know our roads are in terrible shape.

Let's give them a break and get kids into busses and light rail.

Economic development is huge and I think that's been a city priority.

Certainly since I was on the city council.

Um, getting kids trained, getting them into after school jobs, internships.

That's all very important.

You can go down this list.

It's really -- as kind of a recovering politician, You can look at different policies and say, “how many different areas can we touch that this would be a benefit for?

” This program at $1,000,000 out of a $1.6 billion city budget really does a tremendous amount and it doesn't mean we shouldn't do cost sharing with school districts, with the county, which has pledged $1,000,000 over three years.

But but it means that we need to continue to support our young people to be successful.

And that leads to a successful city in the long run.

Leyne: So, you know, I'd like to jump in here if I can, Scott.

You know, I don't disagree with anything Jay said.

Um, I think that it has been a successful program.

I think Mayor Serna was not wrong.

But I am not a recovering fiscal policy nerd yet, um, and I have a fiduciary responsibility on behalf of the City of Sacramento and its residents to balance the budget to ensure that we can continue to deliver programs and services.

And so for this -- the policy question here is really the role and... and... and resources of municipal government.

Let's be clear, Every city and county in California gets an allocation for transit services.

It comes through their regional transportation planning agency, which for us is SACOG.

And if that agency has a transit service, those funds are used for operations.

So, for example, L.A., Roseville, Elk Grove would be examples of those who have a transit service in-house.

Since we aren't a transit agency, our allocation goes to R.T..

They already get $32 million a year through the city's transit allocation.

It just really doesn't make sense for a city that doesn't provide transit when there's a separate kind of regional transportation agency that receives our city's funding for us to pay even more.

You know, the program was added pre-pandemic when our local transit agency either couldn't or wouldn't fund this program.

And it just doesn't make sense.

Um, It was kind of inappropriate then, from this policy perspective for the city to be funding it.

And it's even more so now given our budget challenges.

Again, it's a it's a good program.

Um, the city's effective pilot has proven that increased ridership, um, is getting kids to school and decreased truancy.

The flipside of which school districts have increased ADA so that we're increasing their resources.

My understanding is also that they have access to home to school transit funding.

So now there are several, uh, three, RTs Allocation School District ADA, home to school transit funding, three options, two from school districts that have benefited from the city's investment that we could look to to help the city out.

I -- you know, I'll tell you, one of our elected officials said to me the other day, I feel like the city has a tendency to step in and help when times are tough, but then we get a target on our backs when we don't have the funds to continue a program.

How fair is that?

We have piloted it.

We've shown it successful.

We're already funding these things.

And I'm going to add a fourth.

Measure A, which is a local add on sales tax for transit funding.

RT receives substantial measure resources, and it includes a specific provision in the 2009 measure that those funds can be used specifically for this purpose.

So -- it's just, you know, when we're facing a $66 million deficit and let's be clear, it's going to get bigger next year because the ways we've proposed to close the deficit are using a combination of ongoing and one time money.

Anything we do with one time money, we'll replicate itself.

And every person who works for the city gets more expensive in the following year.

That's just undeniable.

So costs are going to continue to increase.

So it's just a challenge seeing that the city can't continue to subsidize R.T. and the school districts at the expense of core city services.

That's really where we're at.

It's not that it's not a great program and it's not that we shouldn't have it.

And I think that if folks have a chance to go back and look at the council meeting from last night, they will see that all of our elected officials think this is a program that should be continued, just potentially not at the expense of the city.

In the place where, uh, there is the benefit to our schools, um, through the school districts and to RT through their ridershi Jay: Right.

So I did say that we should have shared costs, but doing it kind of, um, at this moment doesn't really work because you're not going to get it done in time for the budget and passes need to go out.

Couple of points I want to make and it's really about core values and priorities.

And sometimes we lose what we did.

And so I want to bring it back just for a minute.

The city when I was there, passed a youth development plan in that plan that had the core value of eliminating systemic barriers that prevented young people from being successful.

Transportation is a huge part of that.

In the mission statement, it says that the city will lead collaboratively and work with other partners to get many of these things done.

Again, both of those things, I don't know where that was taken into consideration.

I don't know where the city, if they did, reached out to youth development providers, um, those who know the young people best.

I will tell you that R.T., if you -- if they were paying full freight for each of the young people, the 4.2 million, they would they are already subsidizing this program by close to $10 million if they were paying full fare.

So I think that we can certainly look at how we work better with the county, with other school districts, with other cities.

But these are our children.

And... and we have a responsibility to make sure that they're successful.

And I want to come back to that core value, um, you know, and... and it's around priorities.

I understand budgets.

I understand that we are in a world of hurt at $66 million on a deficit.

Um, I know the city signed contracts and that raised the amount we were paying new employees by about 45 million or so.

So it's not like there's not money out of the $1.6 billion city budgets.

The real issue is where do you put those dollars that you... that you do have?

And again, I think that should be a priority for the city.

It's really necessary.

And when you talk to young people and see what they've done, 25% of the ridership at R.T. are now kids, 25%.

We started at about 8% prior to this program.

That's a huge increase.

Um, so let's talk to R.T., certainly about what we can do together.

Let's talk to the school districts that don't put it on the back of them this year.

Let's take our time and do that.

Scott: Well...

Hold on.

Leyne: I have a ...

I have - Scott: Let me get in here for a sec.

I...

I have to ask the question, because if, um, Leynes explanation that cities like Elk Grove are their own agency as opposed to our T, which Sacramento passes funding down to speak to the case of the fact that if R.T. is already getting pass through funds from the city of Sacramento, haven't they done enough?

Scott: Well, first of all, I don't think we can ever do enough for our young people.

So I want to be really clear about where I am on that.

If we don't... if we don't take care of these young people who are incredibly articulate and there's other examples of what the city has done, which I'd love to come back to, to show the value or non value of young people in the city's eyes.

But... but and Elk Grove, um, R.T. serves Elk Grove.

They've taken over the bus system, uh, in Elk Grove.

I know that R.T. has done a wonderful job over the last 10 to 12 years with Henry Lee as their dir -- general manager, righting the ship because they were close to being bankrupt.

Um, but it's har -- and they're in better shape than most transit agencies across the country, and they've actually won awards for what they do in their management style, in their management and operations.

And we need to reward them for that.

But I don't know that they have enough money to subsidize this program more than they're doing now.

Um, I think $1,000,000 is a small amount of money when you consider the entire budget.

Um, if.. if we're going to wean them off of it, let's do it over a period of years.

Let's talk about that and how we do it.

Bring the superintendents together.

Doing it at the last minute, uh, is not good, and it would have been great to involve the providers of youth services in the city in the decision making early on, before Leyne, before.

Scott: Before, Leyne -- before, uh, I want to get you in here, but before you do, Jay, you alluded to something a few moments ago about other examples of how the city does or does not value young people in youth.

Um... You open that door.

I need you to walk through it.

We want to hear what you're talking about there, because that was kind of a... a statement and you didn't go completely there.

So what's behind that?

Jay: Well, just a few examples.

I'm happy...

I'm happy to give.

Uh, one is something that we did in the last couple of years of my tenure on the council was we created a waiver program for sports fields so that young people wouldn't have to pay the cost on sports fields.

And we did that.

This really aligns with the the work that -- the very good work that the city has done around equity.

And it allows, uh, teams and individual young people to reserve those fields at no cost.

I think that's a really important piece.

Again, you could point to public safety when kids are busy in those afterschool hours and you can certainly point to equity on that.

What I believe the city's budget has done, and I haven't read all 538 pages that closely, I think I'll try to go through it as much as I can.

The city has taken away that waiver ability and actually is proposing to raise those fees.

So if I'm wrong, you can certainly tell me.

Let me give you an - Scott: Uh, Leyne I see Leyne.

So - Leyne: Ill...

I'll just add, um, not only -- well, we did propose to raise fees, but we also proposed to expand the waiver program to the programs where we raised fees.

So it's not without consideration of equity and what changes to those fees would do.

Very mindful of that.

So please know that that is part of the proposed budget.

Jay: That's great.

Um, sometimes it's a little difficult to read and see what's what on it.

Ill give you another - Scott: What we really want to know is whats -- if if this budget cut happens, Jay, what's the human cost?

How will our kids lives change?

And what is it that you feel they stand to lose?

Jay: I think potentially there are millions of rides that may not happen.

If they do happen, it's going to be -- and we can't find alternative means of funding, it's going to be a cost to those families.

And we know that the families, kids and families that use public transit, most are generally kids of color and... and folks that are not in the upper economic status.

So that's who will get hurt on this most.

Scott: And what is it that they will not be able to do?

What, uh... Jay: I think for young people, They may not be able to get to school and back, they may not be able to get to a job and back.

Certainly recreation and after school hours programing may be more difficult to get to if... if at all.

Scott: I guess I understand all of those are compelling reasons.

At the same time, the city, no disrespect Leyne, the city, um, is struggling right now because it is seen as ineffective on dealing with the homeless issue.

Um, there are people concerned that public safety is at a crisis point where it is that people don't want to interact in their neighborhoods or in -- especially in downtown Sacramento.

I heard from someone yesterday who said that downtown outside of the arena is like a ghost town because of, um, the absence of people.

And that, frankly, Leyne, that you are way too optimistic on what the future of your budget is.

And so with all of those crushing impacts going on, um, it seems that there's a lot of competing prior... priorities.

You talked about values, Jay.

I guess to Leyne what I want to know is what are the city's values and what is it that are the priorities for the city to preserve that people can look to as this budget process goes forward?

Thank you, Scott.

I appreciate that.

It's interesting, We... we did not only a community survey, but council held a priority setting workshop in September.

And, um, the real values that seem to replicate themselves are around solving the homelessness problem, affordable housing, clean and safe, um, public safety, um, uh, clean air and transit, uh... uh, walkability, making sure that, um, we're getting people where they need to go, not necessarily through subsidizing bus passes.

So we really are trying to structure the budget to reflect those core values.

And let's be clear, there is still a tremendous amount of funding for youth programing included in the city's budget.

And... and I will go back to my pointy hat nature.

I think it's unfair to say in a $1.6 billion budget because half of that cannot be used for this purpose.

So, yes - Scott: Why not?

Leyne: Why not?

Because they are, uh, fees collected for specific services.

For example, when you pay your garbage bill, I can't take that money and use it for ride free RT.

And that's included in the $1.6 billion number.

So the... the color of money, we call it, is really important.

Half of that number cannot be used for this purpose.

Jay: So 800 million.

Leyne: So it's a... it's an $800 million budget.

Sure.

That's a... that's a big number.

But we have big costs.

And I guess, um, you know, my question to Jay would be, what would you cut?

Because as Scott said, um, downtown and getting people back downtown is an economic engine.

And one of the pieces of conversation that we had in one of the reductions we chose not to implement was funding for continued clean and safe downtown that was started during COVID because we want to bring people back to the downtown.

I think it's and important economic - Scott: Lets let Jay get a chance to get in here, though.

Jay: Yeah, I mean, I think the easy thing for me, as you're asking to put $3.8 million into the reserve, I think if there is a crisis and I would call this a crisis, you use some of that money and take $1,000,000 out of what was going to go into the reserve, uh, and... and put it into this program and with budget language saying we're going to continue to work with school districts, uh, and other cities to develop a cost sharing system over time.

Scott: So, Jay, I...

I want to come back to something because the city has been and this goes back to your tenure as well, criticized for its inability to move the needle, at least in the public's eye on... on the homeless issue and other issues.

And so the question is... is what, uh, do you perceive if you were to give the city of Sacramento a grade in terms of how it values and invests in youth, what... what's the grade that you would give them today?

Jay: It depends how far we go back, but I would say at best, a C, I think if you go back to my first attempt at doing a cannabis tax or raising the cannabis tax and doing a youth fund, uh, measure Y, we actually had a city manager who wrote a public letter opposing what I was doing as a city councilmember, which was unheard of at the time I think.

Um, if you look at, for example, another smaller example is when I was there, we created an Office of Youth Development within the city manager's office, and we wanted that person because youth touch so many different departments.

We wanted that person to be able to work across departments that, to my knowledge, uh, that office got moved into the Department of Parks and... and Youth and Enrichment.

And I'm not sure that theyre, what I hear and I may be wrong, is that it doesn't exist anymore.

So who's working on youth policy, uh, for the city?

You know, we were looked at really as a model in this.

We did something at the League of Cities a year and a half ago, went down to their annual meeting in Long Beach, and we did a workshop on what we were doing as far as youth.

We had a 130 different cities, uh, represented in the room who wanted to come and listen to what we were doing because Sacramento was really looked at as... as a prime mover and shaker in this area, I don't think - Scott: Right.

Right.

And we are going to have to leave it there.

I guess what I would say is that, um, the city is blessed to have two people that even if they don't necessarily agree on all the issues, are obviously very committed to the betterment of the city.

So appreciate, um, both of you coming on the show and being a part of the conversation, on educating the public.

Thank you.

Jay: Thanks, Scott.

Leyne: Thank you.

All right.

And that's our show.

Thanks to our guests and thanks to you for watching Studio Sacramento.

I'm Scott Syphax.

See you next time right here on KVIE.

♪♪♪ All episodes of Studio Sacramento Along with other KVIE programs are available to watch online at KVIE.ORG/VIDEO