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April 2005

The Bottom Line: Solutions for San Diego’s Budget Crisis presents a new perspective on the City of San Diego’s budget crisis.

Tremendous growth in San Diego’s population and business economy has greatly increased the demand for municipal services, but contributions to municipal revenues haven’t kept pace. While San Diego has the strongest economic growth of the largest 10 California cities, it falls far behind in collections from revenue sources such as business license taxes and utility taxes.

The quality of municipal services helps spur economic development, but San Diego’s outdated general revenue tax structure doesn’t ask businesses to pay for what they get. In many cases, residents also pay less than in other cities for basic services. The Bottom Line points out changes to the city’s tax and fee structures that could add $280 million a year to revenues, simply by charging rates that are average among California’s large cities.