The City’s Budget Reveals Our Values

This year, as we prepare to tackle San Francisco’s budget deficit, I, as chair of the San Francisco Board of Supervisor’s Budget Committee, called a number of hearings to help bring transparency and understanding to what is at stake in this year’s budget and what it means for all of us. This is my fourth year as the Budget Committee Chair, where I have worked with two different board presidents and two different mayors to help guide our City’s finances to provide a stronger and more resilient San Francisco. I believe that, throughout these four years, we have done a lot of good work to trim waste, increase efficiencies and guard against corruption. These hearings were intended to help Budget Committee members understand the progress we have made as well as hear the priorities of everyday San Franciscans.

The hearings covered the controller’s projections on the City’s five year financial plan; the board’s budget process and priorities and my planned approach to this year’s budget; the Budget and Legislative Analysts’ reports that I commissioned, on our City’s debt capacity and whether fee reductions and housing production incentives that the board passed in 2023 achieved their intended results. Additionally, we heard about how departments’ proposed budget cuts would impact vulnerable communities, and City programming, specifically for our older adult population, homelessness and supportive housing programs, our City workforce, Free City College and affordability for families.

Moreover, these hearings help provide a framework for the board and the mayor as we embark on our annual process to deliver a balanced city budget that also does not worsen the situation for our most vulnerable communities because many are already suffering from federal level cuts. Most recently, the controller acknowledged our work on the budget for the past three fiscal years and now has indicated that we are finally moving in the right direction. We have stopped adding to the structural deficit and instead are seeing an increase in our projected revenues. Today, we are at a critical point to continue this positive growth, and this is why we must halt policies that are not generating the desired growth and maintain critical community programs and services. Instead, we must evaluate possible funding sources, like the more than $310 million in unspent contract authority and general obligation bonds, $120 million in legal reserve that was earmarked for an AirBnB lawsuit settlement payout (AirBnB settled at $0 with the City) and eliminating fee waivers that do not serve our City.

For example, in 2023, in an effort to spur housing production, the City passed a Temporary Fee Reduction Program to reduce inclusionary housing requirements and development impact fees. However, the Budget and Legislative Analyst report showed that one of the eight fee waivers granted to developers, a 33% discount on impact fees, resulted in a loss of $34.3 million in revenue but did not “push a substantial number of housing projects towards feasibility nor has it resulted in a measurable increase in housing production since 2023.” This is an example of an ineffective policy – we must invest taxpayer dollars effectively and set expectations for rate of return that will deliver housing that people can afford.

While I agree with SF Mayor Daniel Lurie that we need to invest in our revitalization and bring back conferences downtown, I know we must ensure our small businesses remain robust as well as continuing to invest in our thriving neighborhood corridors across the City. We can do this by using our budget dollars wisely – not on policies that give away our public dollars with no accountability, but on the types of services and programs that increase the vibrancy and affordability of our City and for our residents. These are the priorities I will use as we consider the budget in hearings throughout the month of June.

I will be stepping down as Budget Committee Chair this August so that other members on the Board can have the opportunity to navigate the budget with fresh and new perspectives. However, I am committed to ensuring our City will continue to hold firmly to our San Francisco values, prioritizing care for the most vulnerable.

Connie Chan represents District 1 on the San Francisco Board of Supervisors. She can be reached at 415-554-7410 or chanstaff@sfgov.org.