SAN DIEGO—A looming $252.2 million deficit does not make San Diego Mayor Todd Gloria pessimistic about the future of San Diego, but is an opportunity to revisit how the city operates, Gloria said Wednesday during his annual State of the City Address.
As expected, the budget shortfall—comprising around 12 percent of the city’s total spending—made up the majority of his speech. But instead of leaning into what will be difficult cuts going forward, Gloria said San Diegans are natural innovators who will find ways to make things work.
“The stark financial realities we face today will test our resolve,” he said. “This is not the time for retreat. This is not the time to slow down. This is the time to double down. We are moving forward.”
To cut down on costs, the address was moved from one of downtown San Diego’s theaters to the Council Chambers in City Hall. The mayor has also frozen non-essential hiring, paused non-essential discretionary spending and is in the process with city staff of evaluating all of the city’s leases with an eye of terminating or renegotiating ones that don’t serve the public good.
“The task ahead ... is to right-size our city budget—not just for this year, but for the long-term,” Gloria said, before referring to San Diegans at large. “We adjust, we get creative and we make the most of what we have.”
Gloria said 2025 was time for the city to get a fair deal from entities such as the county and Caltrans when it comes to homelessness. He said the city has for far too long shouldered the burden of homeless residents suffering from substance abuse and/or mental health issues.
“It’s long past time for all the cities in this county to do their part and not simply rely on you, the taxpayers of this city, to continue to foot the bill,” he said. “My fellow San Diegans, it is my hope that, anytime you see a person on the street suffering from extreme mental illness or addiction, you think of the county of San Diego and ask them: When will they step up to provide the services needed to end this crisis?”
According to the mayor, the city on average has received 300 calls a month about homeless encampments on state-owned land near highways, leaving city officials hands’ tied. He demanded Caltrans either take action or give the city authority to do so itself.
In last year’s address, Gloria claimed he would build at least 1,000 new shelter beds for homeless people. With several large projects—such as a safe-sleeping site at H Barracks near San Diego International Airport and a large shelter at Kettner and Vine in the Midway area—stymied, the city fell short of that goal.
That didn’t stop Gloria from reiterating his intention.
“We will, even with our difficult financial picture, increase options for people experiencing homelessness this year,” he said.
A one-cent sales tax measure that could have shored up the impending deficit narrowly failed in November. As a result, Gloria and the city will have to determine how to maintain service levels and what must be cut.
He said police, fire and paramedics remain a top priority and that the structural budget deficit the city tangles with year in and year out would be dealt with.
“We cannot seek one-time measures,” he said. “No gimmicks, no Hail Mary passes, no cavalry is coming to save us. Steep cuts will be necessary, but I don’t want to slash our way to a balanced budget.”
He touted the “not always perfect and rarely easy” successes of the past year, including upgrading the city’s credit rating from AA to AA+ and reducing the average time to review housing projects from six months to just eight days, allowing for around 8,500 new homes to be permitted in 2024.
As a goal in 2025, Gloria also said he would focus on increasing housing for working class people and families, including “starter-homes” like town homes, condos and row homes.
Torrential downpours highlighted the city’s long under-funded stormwater system last winter, when damaging floods forced hundreds to leave their homes. Then-City Council President Sean Elo-Rivera had proposed a stormwater funding measure for the November 2024 election, but withdrew it to lend support to the aforementioned sales tax measure. With neither becoming reality, it is unclear how the lengthy list of stormwater projects will be completed before the next major rain event.
