Berzerkeley Schools California on Economics

People's Republic thriving in tough times

View Comments ()
|
Email
|
Print

    NEWSLETTERS

    Getty Images
    People in Berkeley shop and eat in Berkeley, helping keep the city from becoming a casualty of the economy.

    If any city in California would be going under, you'd think it would be Berkeley.

    But the People's Republic's finances are anything but Berzerkeley. The city with the dreadlocked, tie-dyed image is looking positively pinstriped, thanks to good planning and good habits.

    The City Council is set to approve the $148 million general fund budget tonight. Unlike so many cities in cash-strapped California, they won't be making drastic cuts or layoffs to make ends meet.

    The city of Berkeley is experiencing comparatively good times financially because they make smart business decisions,  said city spokeswoman Mary Kay Clunies-Ross. "We're still making cuts," she noted. "I wouldn't call them good times."

    So, how are they doing it? City leaders credit themselves, somewhat, but also hand out kudos to the citizens of Berkeley, who keep the money flowing inside its borders and have voted for higher taxes.

    People in Berkeley also benefits from having more stable rFourth Street and College Avenue. "We have more neighborhood-based retail areas," says Clunies-Ross. "We don't have the highs that places with big-box retail do

    Big-box stores are rare in Berkeley, with locals' hard-earned cash going instead to neighborhood shops scattered throughout the East Bay city. That helps keep the tax revenue inside city limits.

    Even though the formula seems to be working, not everyone thinks Berkeley is making all the right choices.

    Marie Bowman, who heads up Berkeleyans Against Soaring Taxes, says the city is making mistakes that will cost down them road. Bowman told the Chronicle that avoiding big-box retailers hurts the city because they aren't offering a more diverse economic base.

    Vesely, the budget manager, points out that the city also has its own health department and collects its own garbage, which helps it control costs. But the real answer to whether Berkeley is doing is right will come in the fall.

    The good times -- again, comparatively good times -- may come to an end in October when the ramifications of the state's budget becomes clear. Sometimes the state's moves catch city budget planners by surprise.

    "The state might pass fees that wouldn't catch anyone's notice -- except that the fees are paid by cities, which lose thta budget money," Clunies-Ross explains.

    A previous version of this story indicated that Berkeley budget manager Tracy Vesely spoke with NBC Bay Area. In fact, Berkeley city spokeswoman Mary Kay Clunies-Ross was interviewed for the story.