San Francisco Budget Update

Supervisor Carmen Chu

June and July mark the months when the SF Board of Supervisors reviews the mayor's budget submission for the next fiscal year. Just this April, the controller's office worked collaboratively to issue a report projecting a $483 million shortfall for the upcoming fiscal year budget. In contrast to other government bodies, by law, the City is required to pass a balanced budget each year. With such a large projected deficit, this means difficult decisions must be made around what programs and functions are funded.

The proposed budget is $6.5 billion. The budget funds services, like public safety and road repair work, and includes the operations of entities that have a Bay Area-wide impact, like the San Francisco International Airport and SF Public Utilities Commission. The City Charter mandates that the final budget be signed into law by August.

Major proposals to bridge the budget shortfall include wage and other concessions among labor unions; reductions to city positions; additional leveraging of hospital fee revenues; and spending reductions within city departments.

Significantly, the budget is constantly evolving as we get better data on the actual state of our revenues and as the state's own budget process moves forward. For example, the proposed budget assumes a loss of $30 million in state funding. To the extent that the actual level of cuts are different, we may be faced with even more cuts in the future.

While the Board of Supervisors continues to fine-tune the budget, I also want to speak on at least two measures addressing fiscal responsibility that were recently put into place. Though the measures don't solve the budget problems in its entirety, they will help our city achieve greater stability in the long run.

One of those measures was recently passed by voters in the June 2010 election, and would reduce the cost to the City for employee retirement benefit costs. With the passage of this reform measure (Prop. D), the City anticipates saving between $400 million to $600 million over the next 25 years.

The second reform measure was passed by the Board of Supervisors this April. Proposed by the city's independent controller, the legislation gradually increases the amount of money the City has in reserve to weather tough financial years, limits the City's ability to spend one-time revenues on ongoing expenses, and spreads out the use of our reserves over several years to ensure we have the resources to address multi-year budget problems.

Having served as the deputy director of the city's Budget Office before my time on the Board of Supervisors, I understand how critical addressing these financial issues is to the long-term sustainability of our city's operations and encourage your voice in the budget process.

For specific questions about budget impacts to specific programs or services, please contact our office at (415) 554-7460 or e-mail chustaff@sfgov.org.

Taraval Median Planting

Join our office on Saturday, July 24, from 10 a.m. - noon, as we revitalize the median garden at Taraval Street and the Great Highway. We are currently working with the SF Department of Public Works to prepare the median so volunteers will be able to help install climate appropriate plants. Supplies will be provided. If you have any questions, please contact our office at (415) 554-7460 or e-mail chustaff@sfgov.org.

Supervisor Carmen Chu represents District 4.