To: City Council	From: Mayor Ron Gonzales
Subject: March Budget Message	Date:  March 12, 2001
Approved:	Date:

That the City Council approve the direction to Council Appointees contained in this memorandum for purposes of developing the proposed budget for Fiscal Year 2001-02.

In accordance with Section 1204 of the San José City Charter, I present my FY 2001-02 Operating Budget Message for consideration by the City Council and the public.

Our current financial forecast is positive and the Silicon Valley economy is generally strong, but there are growing signs of a national and local economic slowdown. These trends underscore the need for us to be prudent as prepare our budget for the coming year and beyond. We must continue our efforts to improve efficiencies in all our operations, while focusing on accomplishing our highest policy priorities for the residents in our community.

The Mayor’s March Budget Message is based on several sources. These include my recent State of the City address in February and previous addresses; budget messages and commitments from the past two years; and input from community and councilmembers over the past year. This message outlines policy and budget proposals to continue our commitments to improve the quality of life for residents in our neighborhoods, strengthen our partnerships aimed at improving the quality of education for students in San Jose public schools, and sustain the economic prosperity in our city and region.

This memorandum is designed to give the Administration specific directions to prepare investment proposals for the Council’s budget deliberations in May. The City Council will review and vote on these recommendations at its meeting on March 20. The numbers and information in this document should be considered as preliminary. More accurate and current information will be included in proposed budgets submitted by the City Manager and Redevelopment Director. Further Council discussion and additional public hearings will take place before the final budget is presented for adoption in June.

For the second consecutive year, the Budget Office projects a budget surplus in the first year of the five-year forecast. This is the result of the Council’s policy actions of the past two years. This fiscal restraint clearly is proving beneficial to the city’s long-term financial outlook, and the financial community recently recognized our strong fiscal health and effective financial management by issuing excellent bond ratings. San Jose is not the only big city in the state to have the AA+ bond rating.

The January budget forecast projected a surplus of $9.8 million in the first year of the five-year budget, followed by budget deficits in the remaining four years. Council approved expenditures since the January forecast will reduce the surplus and increase potential deficits accordingly. These changes will be reflected in the proposed budget the Administration will submit in May.

In June 2000 Council approved my recommended for a policy that commits the first increment of the City’s annual ending fund balance (EFB) to ensure a balanced budget for the following fiscal year. The 2001-2002 General Fund Forecast assumes $17 million in excess revenues and/or expenditure savings in 2000-2001 will be available for use in 2001-02. This Ending Fund Balance Reserve guarantees this funding will be available.

Growth in our revenues will not be sufficient to fund all necessary base and growth requirements. Therefore, it will be necessary to develop options for reducing costs in the proposed budgets.

Rather than requiring predetermined targets to reduce costs in the proposed budgets, I recommend that the City Manager and Redevelopment Agency Executive Director (hereafter referred to as Manager and Director respectively) be directed to submit a balanced budget to the City Council by working with the Mayor’s Office to identify specific proposals for redeploying existing resources to areas where budget augmentations may be proposed.

Genuine reductions may be required in this process that will be an integral part of the overall approach to achieve a balanced budget. Proposals to reduce budgets, therefore, should not be approached merely as offsets to augmentation proposals, but rather they must be developed as part of an overall strategy to achieve the City’s policy goals. They should focus on services that can be reduced or eliminated using a framework of priorities and demand for services. Proposals for budget reductions should be developed with the same level of analysis that includes detailed data, justification, and outcomes that we expect in all proposals for new or increased services.

As in the past, all proposals for either budget reductions or augmentations should be measured against the following Council-approved criteria:

• Impact on essential citizen services
• Adherence to Council approved priorities
• Relative importance to operational efficiency
• Effect on fiscal integrity and flexibility

I recommend the Council direct the Manager and Director to continue their adherence to past Council direction that all budget proposals be based on the evaluation of services in view of the above criteria and the following general principles to achieve our goal of making the City of San José the best-managed city in the world:

1. The proposed budget should reflect maintenance of effort for basic services and implementation of current policy direction unless otherwise directed. This includes continuation of the City’s commitments for library funding, housing production and affordable housing, airport improvements, and neighborhood investments.
2. Requests for resources to provide new or increased services must come with clearly identified outcomes including specific service levels (quantity, cost, quality, and schedule) that will be achieved.
3. Priority consideration will be given to those proposals that improve service with the same or fewer resources.
4. Methods to deliver service at a higher quality level, with better flexibility, and at lower cost should be used where appropriate. In some cases, we may work with the private sector to achieve savings or improvements. In other cases, it may be better for the City to provide the service with our own workforce.
5. We should aggressively seek opportunities to provide services or meet public needs through appropriate community partnerships, public-private partnerships, or through leveraging City resources and investments.
6. We should always focus services and resources on the City’s priority goals and results. This includes avoiding duplication of effort that occurs between departments. We should also look for opportunities where services can be provided more appropriately or better by other government agencies or community organizations.

Through the Investing in Results process last year, the Agency Board reviewed the four Core service Areas for the Redevelopment Agency. The four Redevelopment priority policy areas are:

1. Promote and Implement Neighborhood Improvement Strategies
2. Initiate and Facilitate Public Facilities and Spaces
3. Enhance the Quality and Supply of the City’s Housing Stock
4. Initiate and Facilitate Private Development

The Agency Board last year confirmed my recommendation to shift the focus of our Redevelopment resources to neighborhood investments. The Board indicated its desire to have the first three policy areas receive roughly equal amounts of resources and the fourth receive a lower level of funding. I recommend that the Agency Board reaffirm this direction and direct the Director to work with the Mayor’s Budget Office to develop a five-year capital improvement plan that achieves the desired balance of spending within the core service areas.

The Council has identified seven City Service Areas that cover all core services through the Investing in Results process. The structure of this budget message reflects the seven City Service Areas:

1. Aviation Services
2. Economic & Neighborhood Development
3. Environmental and Utility Services
4. Public Safety Services
5. Recreation and Cultural Services
6. Strategic Support
7. Transportation Services

It is important that we use City Service Area framework for preparing and reviewing our budget to ensure consistency in our deliberations. This framework emphasizes our desired approach to improve interdepartmental, collaborative, and results-oriented services. Redevelopment and City services should be considered integral and mutually supportive of our overall priorities.

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2. Aviation Services

San José International Airport is an essential asset to San José and Silicon Valley, and it is also an important neighbor in our community. We need to continue to increase the airport’s ability to serve the city and the region, and we must follow through on our commitment to improve traffic accessibility. This is especially true since San José residents put their trust in us a year ago to accomplish this goal when they defeated Measure "O," the Airport Traffic Relief Initiative.

I recommend the following areas of focus as the Manager prepares the proposed budget for the Airport:

1. We should continue our ongoing efforts to mitigate airport noise for homes and schools in Category I areas, and continue testing and treatment of homes in Category II and III areas.
2. Every effort should be made to improve air quality and reduce emissions by exploring funding for low or no emission shuttle buses and an automated people mover (APM) connection to the light rail system on North First Street.
3. We need to develop and implement an Airport-wide customer service program, especially during the construction planned at the Airport. Construction will create a difficult environment for customers for a lengthy period, and therefore we must ensure that customers have the information and support they need to navigate through the disruption as easily as possible. Airport staff should have appropriate customer service systems, training, and monitoring to improve their effectiveness in this area.

1. Economic & Neighborhood Development

While the Council has redirected the focus of Redevelopment resources to neighborhoods, it is important to note that the Council still strongly supports private development investment. One of the Agency’s core services is to initiate and facilitate quality development by the private sector through land assemblage, permitting, public improvements, and other appropriate assistance.

1. The Director is directed to recommend funding in the budget that would provide for maximum flexibility to respond to opportunities for private sector development.
2. The City is regularly presented with economic development opportunities that are time-sensitive but also may require large infrastructure investments that are unknown in scope and impact. Last year Council directed the Manager and Director to include a funding plan for proactive infrastructure studies, such as financial analysis, engineering, and environmental assessments, that would provide critical information early in the process to allow us to expedite development proposals and decision making. This type of proactive infrastructure study is invaluable and should be continued in the coming year.
3. The Manager and Director are directed to identify sites in Strong Neighborhood Initiative areas that have potential for redevelopment. Working with the community and SNI consultants, staff should identify ideal sites for housing, retail, and commercial development.

Protecting our open space is critical to the quality of life of our residents. To help accomplish this goal, the Council placed Measure K on the November 2000 ballot that asked voters to ratify the City’s greenline policies, and San José residents overwhelmingly approved it. Last June Council also approved $3 million from Proposition 12 funds for the acquisition of open space easements within the Coyote Valley greenbelt and other open space.

1. The Manager is directed to set aside a reserve of at least an additional $1 million to be used to leverage other sources of funding to begin to acquire conservation easements within the greenbelt to help permanently secure open space for future generations. The Manager is directed to work with all potential partners to identify sites and secure resources for conservation easements or acquisition. During the budget process, the Manager is directed to report on the progress that has been made with last year’s allocation of $3 million for this effort.
2. The Manager is directed to seek opportunities to further implement the recommendations of the Green Building Task Force. As we continue to pursue greater conservation of resources such as energy, and to improve the sustainability of our community, these efforts will return long-term benefits.

Finding a home, at a price you can afford, has reached a crisis level -- not only in Silicon Valley, but also throughout the Bay Area. San José has been the Bay Area leader in creating more housing, and last year we approved building permits for more than four thousand five hundred new homes, more than all the cities in Santa Clara County combined.

It is also important that San José continues to lead the way in making our community affordable for San José families. Two years ago, Council approved programs to enable San José to double our affordable housing production, and we are well on track to reach this goal by building 6000 new affordable homes by 2004. We must do more, especially for those at the lowest income levels who have the hardest time finding homes in our community.

1. Through the shift of resources within the Redevelopment Agency’s Capital Improvement Program, we should continue to focus more Redevelopment funds on affordable housing. The Director is directed to include $10 million in the first year of the CIP to be transferred to the Department of Housing, which will be designated for use in production of housing for Extremely Low Income households.

2. Last year we directed the Administration and Redevelopment Agency to work with housing developers to break ground on 1,000 new homes in and around our downtown by March 2001. We surpassed this goal by nearly 20 percent, and the result will be 2,500 more residents who call downtown their home.

We should expand our downtown housing efforts this year with the preparation of a Request for Qualifications for coordinated and comprehensive residential development in and around downtown. Through this effort, which should include the participation of downtown communities, we can spur the creation of many more downtown homes in this unique residential neighborhood.

3. We need to ensure that we have adequate staffing and systems in Planning and Building to handle the growing workload from residential, commercial, and industrial development. Although the costs for this effort should be recovered from development as much as practical, the Manager is directed to recommend General Fund support if necessary to achieve the goal of fast, effective, efficient, and responsive service through adequate staffing and streamlined procedures.
4. I recommend that the Manager set aside $300,000 in a new fund to support creative and collaborative one-time proposals from the community to address the needs of homeless families and individuals. The Mayor’s Homeless Task Force last year suggested examples of potential uses, including regional approaches to improve interagency systems that serve homeless people. The Manager is directed to work with the Mayor’s Office to identify uses of this fund that would have an immediate positive impact and could leverage these resources to benefit homeless families and individuals for the long term. These funds would create the Mayor’s Homeless Families and Children Initiative Fund and proposals could be reviewed in a similar methodology to the Arts Venture Fund.
5. The Manager and Director are directed to provide adequate funding in their proposed budgets to fund activities and meet the timetables related to the Housing Production Team recommendations that were approved by the City Council in February.

Great neighborhoods are vital to a great city, and therefore we must continue our efforts to make San José’s neighborhoods the best places to live and raise families. The Manager and Director are directed to include the following items in the proposed budget for our ongoing commitment to strong, healthy, and attractive neighborhoods.

1. Funding should be renewed for the sidewalk, curb and gutter repair program.
2. The Council’s previous funding priorities for streetlight installation should be included as an annual level of service that is sustainable and results in minimal backlogs.
3. The Manager should set aside funding to meet appropriate requests for major streetlight installations that currently have no identified funding.
4. Street tree trimming is an ongoing issue raised by residents who are concerned about appearance and safety. We should explore options for expanding the City’s tree trimming programs to provide tree trimming for seniors as well as trimming of branches that block vision of street signs or block street lights.
5. The Manager is directed to provide an inventory of priority unlandscaped or "dirt" street medians, develop criteria for ranking their need for improvement, and include the estimated costs for improving each site. The installation of median islands is a recurring neighborhood issue that Councilmembers identify during the budget process, and we should establish a strategy to address these needs.
6. Like a broken window or vacant lot, graffiti sends a message about the safety and quality of a neighborhood. We have been very successful by reducing the number of graffiti tags over the past two years from 70,000 to 10,000. Our city crews now consistently meet our high standard for responding to graffiti hotline calls within 72 hours. I recommend that the Manager include funding to reduce the 72-hour response time to a 48-hour response time.
7. The Manager and Director are directed to increase public outreach in the Strong Neighborhood Initiative program to help SNI achieve results that genuinely reflect neighborhood priorities more effectively. We must find ways to involve more residents through physical outreach, e-mail and surveys.
8. The Manager is directed to improve Code Enforcement response in SNI areas by providing proactive enforcement to improve conditions in our neighborhoods.
9. The Manager is directed to implement a proactive vehicle abatement program in targeted neighborhoods to reduce the number of abandoned and inoperable vehicles on our neighborhood streets.

1. The Director is directed to include adequate resources to move forward with implementation of the Greater Downtown Strategy Plan as elements of that document move forward for Council review.
2. We should look for proposals to increase the supply, reduce the demand, and improve the effective use of current parking in our downtown. Examples include a parking guidance system to help motorists find available parking, the expansion of the EcoPass program, and the formation of a van/carpool program should be explored.

1. We should seek improvements to our convention and meeting services to ensure an adequate level of service for our customers, including opportunities to add services that would be revenue positive.
2. The Manager and Director are directed to include resources in the proposed budget to ensure Council’s timely consideration of the issues related to the potential expansion or repositioning of the Convention Center.

1. Building on our investments over the past two years, I propose the Manager allocate $6 million in the proposed budget for a Neighborhood Investment Fund. During the upcoming budget process, I will ask Councilmembers to propose one-time capital investments in their districts that will improve safety or quality of life, or will create a better sense of pride in our neighborhood communities.
2. The Redevelopment Agency budget should include a Strong Neighborhood Initiative Reserve Fund in the Capital Improvement Program to ensure that resources are available for projects identified through the ongoing community process. This will help community improvements move forward expeditiously with adequate funding when project areas and strategies are completed.

1. Environmental and Utility Services

1. The Manager is directed to bring forward proposed budget augmentations for programs for landfill diversion and recycling only if these proposals include the cost-benefit analysis of the diversion effort, such as ton-per-dollar values. Along with the financial analysis, these proposals should include clear information about their effectiveness to help meet the state’s requirement for 50 percent landfill diversion.
2. The Neighborhood Clean-up Program is a direct service that has immediate beneficial impacts on the quality of our neighborhoods and on community pride. The Manager is directed to present options for expanding this cooperative effort in the proposed budget.
3. The Manager is directed to include budget proposals that are necessary to achieve compliance with state law and/or water pollution control discharge permit requirements.
4. We should ensure that the proposed budget includes resources for the necessary and appropriate actions to ensure the smooth transition of our Recycle Plus! Program to new haulers and services in the coming year.

In recent months we have become painfully aware of California’s energy mess. Silicon Valley has a long history of taking bold creative and collaborative actions to solve complex problems such as traffic and housing. We must do the same with energy to become more self-sufficient and achieve greater energy reliability in our region for our residents and businesses.

1. Council approved my San José Smart Energy Plan calling for appropriately sized clean generation facilities in suitable industrial areas, aggressive energy conservation and regional partnerships to achieve our energy goals. The Manager is directed to include funding in the proposed budget to implement this plan.
2. With steep increases in the costs of gas and electricity this year, the City’s own energy bills and its revenue from the Utility Users Tax (UUT) have both increased. The burden of higher energy costs in the community falls more greatly on older residents and those with low incomes. I therefore recommend that we establish a one-time allocation of funds to be used for community programs such as the Home Energy Assistance Program and Emergency Contingency Funds (administered by ESO) that are designed to provide relief for that burden. We could help residents that are falling behind on their payments or need one-time emergency funds to get their power turned back on. The Manager is directed to work with ESO or other providers of assistance to identify the current financial needs of these programs above existing funding and allocate a one-time amount for this effort. This funding should not exceed the net difference between our higher energy costs and our unanticipated UUT revenues.

1. Public Safety Services

People want to be safe and feel safe in their neighborhoods and community. I am proud that San José remains the safest big city in America, and crime rates continue to decline. This achievement is the result of an excellent police department, a good economy, and strong neighborhoods. Our emphasis on crime prevention and law enforcement must continue to ensure the safety and security of our residents.

1. Students can learn and faculty can teach more effectively when they feel safe in their schools and neighborhoods. Last year, we approved funding to expand our Safe Schools Campus Initiative to include all San José middle schools over three years. Funding for the second year of this effort should be included in the proposed budget.
2. San José has been a leader nationally in the fight to end domestic violence. Prevention, intervention, and strict law enforcement help ensure that San José homes will be safe for women, families, and seniors. The Manager is directed to explore opportunities to improve and expand our programs in this area and to make these efforts a priority in our public safety budgets.
3. Proposals for equipment or materials in budget augmentations should focus on how they will result in better protection for our public safety staff or for providing better or safer service to our residents.
4. Continuing and enhancing our strong safety-training program for employees will ensure that they will be able to deliver services to our residents effectively and safely. The Manager is directed to continue efforts to improve these training programs so that our work force is excellently prepared. Safety education and training programs for City employees should be coordinated and evaluated based upon specific outcomes.
5. We should enhance the Police Department’s presence in the community to accomplish the goal of improving community policing to improve our strong neighborhoods.

1. During the mid-year budget process, council approved one-time funding for several items identified in the Fire Services Strategic Plan including: tools and equipment to equip the reserve fire fleet, new rescue units and funding to improve fire recruit academies. The Manager is directed to come forward with personnel-related actions to support the further implementation of the Fire Services Strategic Plan.
2. We should explore efforts to continue to help firefighters become paramedics to ensure adequate first-response times.
3. Efforts should be made to allocate staff resources to ensure that fire engines are fully staffed and online as much as practical. This could include the possibility of contracting out courier services.
4. We should look for opportunities to involve residents in our efforts to improve community safety and health. Not only could this help save lives, it could help the City use its resources more effectively to achieve a safer community. Examples of this effort could include support for public CPR training and the purchase of additional defibrillators located in more public facilities.
5. We should explore opportunities to use medic/firefighter interns where possible to enhance the effectiveness of our firefighter staff.

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2. Recreation and Cultural Services

The "digital divide" is about much more than children and schools having access to technology. Closing the divide means we must take steps to ensure that all our community’s children know how to read, how to write, how to do math, and how to learn in order for them to succeed in the 21^st Century.

1. Smart Start Centers are a critical element to enhancing early childhood education. Two years ago I said that we would build ten Smart Start centers in five years, and we are well on track to meet this goal. I recommend that we double this goal for Smart Start centers and make sure that 1,200 San José children are ready to learn when they enter kindergarten each year.
2. The Manager is directed to work with the Mayor’s Office to determine the best methodology for the City to support the recruitment of the best teachers for San José public school classrooms. The last two years we invested $50,000 annually in teacher recruiting in partnership with San José school districts. We should evaluate the usefulness of this program in conjunction with our schools to determine if it should be continued or redefined.
3. Clean safe places to study help students achieve academic success. Last year Council approved expanding our homework center program so that every public elementary, middle and high school student in San José will have access to a homework center by 2002.
4. The Manager is directed to double the funding for our Future Teacher Scholarship Program so that we can help even more San José college students reach their dreams of teaching in our city’s public schools.
5. We cannot afford to let another class of children enter school without a strong, clear plan of action for our city’s commitment to close the digital divide. I have challenged the San José Youth Commission, the City, and community leaders to develop a "Digital Divide Blueprint" for San José and have it ready before another school year starts this fall. I recommend that the Manager be directed to set aside funding so that projects and programs resulting from the Digital Divide Blueprint can commence immediately.
6. Staff must make sure our programs supporting educational excellence in San José are more visible to the community so that parents are aware of service that can help their children succeed. Fewer than one in five people in our recent 2000 community survey were aware of our programs in this area.

7. We should look for opportunities to expand the SAGE program from 4:00 p.m. to 6:00 p.m. It is important to first implement a small pilot program and evaluate its success before expanding to more facilities.

1. As park acreage is added, the budget should include incremental increases in funding for operations and maintenance based upon current service levels.
2. Continuing public access to Alum Rock Park should remain a priority. The Manager is directed to include a cost-effective plan in the proposed budget to maintain access to the park, including a specific timeline that identifies when the improvements will be completed.
3. We should consider the development of an enhanced School Grounds Maintenance Pilot Program and work with schools to preserve or enhance recreation fields on school sites.
4. Third-year funding for the campaign to provide library cards for first and second graders should be included in the proposed budget. This investment proposal should identify program outcomes and evaluation methods to answer questions about usage, costs for launching and maintaining the program, and how the Library will absorb ongoing costs.
5. The Manager should explore opportunities to increase library staff training where it can be shown to improve services to the public and develop a plan for ongoing training in future years for Council’s consideration.
6. The Library should develop a strategy of innovations that will allow current staff more time to provide more services and improve or expand online access to library services. With the implementation of service innovations, the Manager is directed to explore opportunities to either expand hours at our branch libraries or to adjust hours to times that are more convenient to our residents.

1. The Director is directed to pursue opportunities to develop facilities for arts organizations and programming. The Director also is directed to explore opportunities in buildings the Agency already owns where arts organizations could collocate either their public activities or their administrative operations. We already have a successful arts incubation program, and this model should be expanded to include collocation for larger entities.
2. The Manager is directed to include funding in the proposed budget for the continuation of the Arts Venture Fund.
3. The Mexican Heritage Plaza and Gardens is a tremendous asset to our community. Recently the Center has experienced an economic reality that does not mirror original projections. It is necessary to ensure that this facility is well maintained and continues to be a benefit to our community. The Manager and Director are directed to work with the Mexican Heritage Corporation to identify a stabilization-funding program.

1. The response from families to the successful daytime New Year’s Eve carnival for its first two years has been outstanding. The Manager is directed to include the resources necessary to continue this as an annual event and to seek private partnerships and cosponsors to allow the event to expand to serve more families.
2. We should continue to develop partnerships to help seniors and persons with disabilities to lead healthy and independent lives. Collaboration with community-based organizations is an important component to the success of this investment strategy.
3. We should look for opportunities to expand programs at our senior centers, adult mental health programs, and disabled swim programs.

1. Last June the Council approved my recommendation to discontinue the use of annual surplus funds on ongoing expenditures unless they could be accommodated in the second or possibly third year of the five-year financial forecast. This policy has been a major step toward achieving long-term fiscal stability.

This policy needs to be reflected in the budget model the Manager uses for five-year forecasts. Currently the model assumes that all surpluses will be used for ongoing activities, and this creates the appearance of deficits projected in the out years of the forecast. Changing the model to conform to our new policy and practice should reduce projections of deficits in the five-year forecast and provide a more accurate picture of our long-term financial position.

2. The Manager is directed to continue the multi-year phase-out of card club revenue support of the general fund. This will reduce both our financial dependence on gambling revenues, and it reflects the goals expressed by the City Council.

1. We must ensure that our planning and budgeting of capital projects are as accurate as possible at each phase of development. This will help us manage our resources to complete projects on time and on budget, and it will communicate the project scope and cost more accurately to the public. This is a critical element to ensure the public understands our capital project management and to achieve the confidence of both the Council and the public.

With several recent major projects, such as the new Civic Center and the Fourth Street Garage, initial cost estimates the staff provided to the Council did not reflect inflated dollars for the anticipated year of construction, which contributed to the perception that the projects were dramatically over budget. It is important to make sure that initial project cost estimates are represented in cost for the year the project is estimated to be constructed, and that the capital project planning and budgeting methods approved by Council last year are clearly followed and communicated at all phases of development.

2. Making government services more accessible online is a high priority. We must establish the City’s ability to take online requests from the public for services such as street repair, street light repair, and removal of abandoned vehicles. In addition, we much develop systems to allow customers to make convenient online payments for City services such as utilities, business taxes, permit fees, or parking tickets and to access the Council agenda and all related documents online.
3. We must start addressing deferred maintenance for fire stations, community centers, and other city facilities to ensure that we reduce our exposure to the risks of high costs of repair and replacement, and to maintain our ability to provide public services at these facilities. Plans and budget strategies should be brought back to Council during the budget process to address deferred maintenance at City facilities over the next five years.

1. Transportation Services

Investment priorities fall in three broad categories: maximizing the operation of the City’s traffic system; preserving the traffic system infrastructure, and minimizing adverse traffic impacts on neighborhoods, or "traffic calming." In addition, we should look for opportunities to provide support for regional transit projects and design and construct projects to complete the city’s transportation system.

1. We should find ways to preserve the City’s transportation assets with funding for street maintenance and reconstruction, traffic signal maintenance, and the preservation and enhancement of neighborhood streetscapes through street tree maintenance and replacement of dilapidated street light poles.

Feeling safe in our neighborhoods also means feeling safe when you cross the street. Walking in San José should be good for your health, not a risk to it. Last year we set aside $1.5 million for traffic calming, and this year I propose adding $5 million towards the effort to make our neighborhood streets safer. The recently established Traffic Calming Committee is also developing criteria for policies and projects that will help guide future investments.

The following is an excerpt of a recent newsletter from Walk San Jose. It captures the potential of how we should consider investing in streets to make them safer for pedestrians, cyclists and drivers:

With initiatives like this, San José could be a city where walking and bicycling are safe, convenient, and enjoyable.

The overall goal of this message is to direct Council Appointees in budget development to reflect the policy priorities of the Mayor and City Council. Implementing sound fiscal management policies and initiating new programs through the redeployment of resources as directed in this message will lead to a balanced budget for Council’s consideration this spring that will continue to provide high quality and high priority services to residents and businesses in San José.

This memo has been coordinated with the City Manager, the Redevelopment Agency Executive Director, and the City Attorney.

During the mid-year budget process, it was necessary to appropriate funds for several projects, which had been approved by Council last June, which had inaccurate budget projections. It will be imperative this year as we enter the budget process to have accurate estimates for all projects that Councilmembers propose during the budget process. This year we will be adding an additional section to the template for Council budget submissions which will require identification of the appropriate individual in the Manager’s or Director’s Offices who has certified cost estimates for budget submissions. Councilmembers should begin to work with the Manager and Director now to identify appropriate budget estimates for any proposals they wish to bring forward in the budget process in May and June.