When Mayor Ron Gonzales enters his glitzy conference room atop San Jose's new City Hall, he could dim the lights with his $4,400 touch-screen remote control, then use one finger to fire up his $12,000, 50-inch plasma-screen TV or another to run his $23,200 video teleconferencing system. On the 17 floors below, 1,800 other city employees would enjoy the benefits of a furniture-and-technology budget that spends an average of $25,000 on each of them. Many would sit in their new $3,600 cubicles and make calls on $400 Internet telephones connected to an $8 million phone-and-computer network. At a time when...