San Diego’s budget crisis is slowing pothole patching and crippling a plan to sharply raise road-repair spending intended to get the overall rating of the city’s streets back to the national standard.
That ambitious eight-year plan, announced last year after a comprehensive survey showed San Diego’s rating had dropped from “satisfactory” to “fair,” calls for the city to spend $259 million on street repairs during the fiscal year that starts July 1.
But the city plans instead to spend $83 million — less than one-third of the goal, and sharply down from the roughly $140 million spent last fiscal year and also budgeted for this year.
Pothole patching, which the city has made a higher priority in recent years, is also taking a hit thanks to a hiring freeze and restrictions on worker overtime imposed this winter by Mayor Todd Gloria.
Smaller crews working fewer hours have ballooned the city’s backlog of pothole repairs from roughly 150 just before the restrictions to nearly 2,000. Average wait times between reporting a pothole and crews fixing it have tripled from six days to 20 days.
The news on the paving plan is arguably worse. San Diego officials say that without new sources of money for fixes, the overall condition of the city’s streets will steadily decline to a “poor” rating of 53 by 2035.
“With the existing funding sources we do have, we will see significant declines in the pavement condition score,” Bethany Bezak, the city’s transportation director, told City Council last week.
The comprehensive street survey completed in 2023 showed that the city’s rating had dropped from 71, which is “satisfactory,” down to 63, which is “fair.” The national standard is 70.
Bezak said higher spending the last two fiscal years has the city on course to improve the overall rating to 65 by the end of June, which is still in the “fair” category.
But the plan to achieve a 70 rating by 2034 calls for steep jumps in spending on street repairs that will require San Diego to find new sources of funding.
The city relies on four main revenue sources for street repairs: state gas taxes, state funding under the 2017 road repair law known as SB 1, damage fees paid by contractors who dig up streets and Transnet, the county’s half-cent sales tax surcharge for transportation projects.
Those sources are projected to generate a combined $700 million for repairs during the next 10 fiscal years — far short of the estimated $1.9 billion it would take to boost the city’s rating back to 70.
Bezak recommended scaling down the city’s goal to achieving a 65 rating and then steadily maintaining that.
“Due to the current budget deficit, we think it’s most reasonable to strive for maintaining a pavement condition index score of 65,” Bezak told the council’s infrastructure committee last week.
But even that would cost an estimated $1.7 billion over 10 years — $1 billion more than the city is projected to get.
The most likely source of the needed additional money is the city’s general fund. But a proposed one-cent sales tax increase that could have generated $400 million a year was narrowly rejected by voters last November.
City leaders, including the mayor, had vowed to spend any new money primarily on upgrades to the city’s aging infrastructure, including street repairs.
Another city strategy is to reduce the cost of repairs, which average about $1.2 million per mile for resurfacing projects and a few hundred thousand per mile for less aggressive slurry-seal work.
Bringing some or all of the repairs in-house, instead of paying outside contractors for nearly all the work, could save money, city officials said.
The city has hired 22 people and is spending nearly $2 million during the ongoing fiscal year on a new in-house mill-and-pave team. But Bezak said the new strategy is facing challenges.
The new team often has to wait many months or even years to receive equipment they order to perform road repairs, Bezak said. In addition, the city’s Chollas operations yard is not large enough to accommodate the team and its equipment.
Councilmember Henry Foster encouraged Bezak to keep at it.
“I believe our way out of it is to do more in-house,” he said. “I think we need to figure out how we can turn that corner.”
Another idea is to find savings elsewhere in the operation, but Bezak said most of the “low-hanging fruit” on cost savings has already been picked.
“We worked on faster procurements, and we streamlined contract standards and engineering details,” she told the council.
One potential funding source for street repairs is the city’s infrastructure fund, which grows when the city’s sales tax revenue increases.
The infrastructure fund is not projected to contribute any money to street repairs in the fiscal year because sales tax revenue is not expected to rise.
But the fund has contributed in previous years. The entire fund is in the neighborhood of $20 million in a typical year, but it also pays for other infrastructure projects — not just streets.
Other potential sources include lease-revenue bonds and other debt financing. The city is spending $79 million in revenue from debt financing on street repairs during the ongoing fiscal year and is projected to spend $27 million in the fiscal year.
Debt financing is not included in the $700 million in revenue city officials are projecting for street repairs during the next decade. That’s because it’s not known whether the city will choose to fund the repairs that way in the future.
Another possibility is Measure C, a 2020 ballot measure that is the subject of ongoing litigation. City officials are so confident of a court victory that they plan to begin collecting Thursday the higher hotel tax called for in the measure.
The measure is projected to generate close to $7 billion over its 45-year life, with $4 billion dedicated to expanding the city’s waterfront convention center, $2.1 billion for homelessness initiatives and $650 million for street repairs.
But the rules of the measure say money for repairs doesn’t start until the sixth year the higher hotel tax is in effect.
City officials have begun providing the council and the public more details about street repairs since a February 2024 city audit recommended they set annual goals for miles paved and identify any challenges, along with strategies to overcome them.
Councilmember Marni von Wilpert said she appreciates knowing more.
“While not always great news, it’s still important news,” she said. “We need to be keeping track of the condition of our streets. These are billion-dollar assets, and we need to plan for the longevity of them.”
