Recovering Equitably and Addressing Top Challenges: My Proposed Budget for San Francisco
How I am proposing to allocate City resources for the next two fiscal years
San Francisco is on the road to recovery. Our vaccination rates are among the highest in the country, we have the lowest COVID-19 hospitalizations we’ve had since the beginning of this pandemic, and this year, our City budget is healthier too. Earlier today, I announced my budget proposal for the City and County of San Francisco at Willie ‘Woo Woo’ Wong playground in the heart of Chinatown. I was joined today by City officials and community members, and it was great to have this opportunity to come together in-person to talk about our plans for investing in the future of San Francisco.
In early March 2020, I stood in Chinatown alongside fellow City leaders and members of the business community to announce a series of steps we were taking in response to the novel coronavirus. At the time, we didn’t know just how bad things would get, and just how much our residents and entire economy would suffer. Last year, our budget process was pushed back due to the pandemic, and we were facing dramatic budget deficits. But thanks to San Franciscans’ efforts to protect one another, the COVID-19 vaccine, and real support from our federal government, here we are nearly 15 months later and in a much better place.
We’ve been able to close our budget deficit, and are making historic investments that meet the critical needs of our city, while also maintaining financial responsibility and ensuring our future financial resiliency. I believe we can move forward an economic recovery that is equitable and sustainable, so that San Francisco emerges from this pandemic stronger than ever.
A Balanced Budget
The proposed budget that I am introducing is our roadmap to economic recovery. It will guide our efforts as we emerge from this pandemic and work to build back to become even more equitable and resilient than before. We’ll continue our long-term goals to build a stronger, more resilient San Francisco — and make progress on our efforts to create a San Francisco for all.
My budget proposal includes important new investments to support an equitable economic recovery, continue our COVID-19 response, ensure public safety, provide behavioral health care, prevent homelessness and transition people into services and housing, create more housing, and support children, youth and their families.
Below is an overview of some of the new investments for our priority areas in the budget. You can read the full budget proposal for Fiscal Years (FY) 2021–22 and 2022–23 here.
Driving a Sustained and Equitable Economic Recovery and Continuing City’s COVID-19 Response
My proposed budget includes around $477 million over the two years for various initiatives to drive and accelerate the City’s economic recovery, while also supporting the City’s COVID-19 response. Major recovery initiatives include Community Ambassadors and events and activities to enliven San Francisco’s downtown, backfilling the loss of hotel tax revenue for the arts, addressing student learning loss, the Women and Families First Initiative, incentivizing the return of conventions at the Moscone Center, a new Trans Basic Income pilot program, and continuing the JobsNow workforce program and Working Families Credit.
Of this total, about $384 million will be spent to continue the City’s COVID-19 shelter response, food security programs, vaccination efforts, testing operations, and the COVID-19 Command Center. Funding will also support community-based COVID-19 recovery programming, specifically targeting resources to populations disproportionately impacted by the pandemic. This funding includes small business support, economic relief, workforce development funds, and various arts, cultural, and recreational programming.
Making Historic Investments in Homelessness and Housing
The proposed budget includes significant investments to address homelessness in San Francisco and expand the work started through our Homelessness Recovery Plan to create 6,000 placements for people experiencing homelessness.
In total, the budget leverages over $1 billion over the next two years in local, state, and federal resources to add 4,000 new housing placements, prevent homelessness and eviction for over 7,000 households, support additional safe parking sites, and fund the continuation of a new 40-bed emergency shelter for families. All of these investments are in addition to prior commitments. This funding will enable the City to cap all Permanent Supportive Housing (PSH) rents in our PSH portfolio at 30% of a tenant’s income.
Expanding Mental Health and Substance Use Support
We’re continuing our commitment to helping people with behavioral health and substance use issues. My proposed budget contains $300 million in new investments for behavioral health services. Included in the budget is funding to prevent overdoses through medication assisted treatment, a drug sobering site, and expanded naloxone distribution. The budget also includes funding to support new and existing Street Response Teams, including the Street Crisis Response Team, Street Wellness Response Team, and Street Overdose Response Team.
This investment will help fund our long-term plan to add 340 more treatment beds (on top of the over 2,000 we have now), provide case management and care coordination for people receiving services, and expand services at the City’s Behavioral Health Access Center. This investment will also provide targeted services for transgender and Transitional Age Youth clients, and increase services for clients in shelters and Permanent Supportive Housing.
Investing in Public Safety, Victims’ Services, and Justice Innovations
My proposed budget includes over $65 million over the two years to prevent violence, support victims, continue the City’s investments in alternative responses to non-criminal activity, and create an Office of Justice Innovation to oversee, implement and work with the community to expand this critical work. The budget includes expanded violence prevention programming and funding for victims’ rights, including targeted investments to support community-based violence prevention and intervention work, and to San Francisco’s Asian and Pacific Islander community. The proposed budget includes funding to maintain police staffing levels, including funding for new academy classes and staffing to support compliance with SB 1421 as part of the City’s efforts to increase accountability and implement the 272 recommendations from the Department of Justice.
To strengthen the City’s non-law enforcement response to non-criminal activity, my proposed budget includes new funding for our Street Response Teams and to support call diversion. Additionally, the budget includes funding to replace Sheriff’s deputies at public health sites with trained health care professionals and community members.
Supporting Children, Youth, and Their Families
I am proposing $144 million to lay the groundwork for early learning and universal preschool in San Francisco. This includes funding for childcare subsidies, workforce compensation for childcare providers, child health and wellbeing, and Family Resource Centers.
The proposed budget also maintains our existing investments in children and youth, invests significant new funding to address learning loss, funds mental health for SFUSD students, and supports our Opportunities for All initiative.
Supporting Long-Term Economic Justice Strategies
My proposed budget continues the City’s $60 million annual investment in the Dream Keeper Initiative, which we launched to reinvest in services and programs that support San Francisco’s Black and African American Community. The proposed budget also includes funding to waive additional fees and fines paid to the City by San Francisco residents. Additionally, the budget supports the City’s efforts to promote diversity, equity and inclusion and ensure citywide coordination of equity work. My proposed budget invests in the sustainability of the City’s nonprofit partners with $76.4 million for a cost of doing business increase.
Investing in Capital Projects and Affordable Housing
I am proposing significant investments in capital and one-time projects, which will create jobs and spur economic recovery. The proposed budget provides $50.6 million to support affordable housing developments in San Francisco.
The proposed budget includes $208 million for projects from the City’s Capital Plan, including street and parks infrastructure improvements, an expansion of fiber to affordable housing, and community facility improvements. The proposed budget also includes funding to replace aging equipment in the Fire and Police departments, as well as funding to purchase a site for an LGBT Cultural Museum.
Ensuring Financial Resilience
The two-year budget makes the above significant investments in a way that is financially responsible. By utilizing funding from the American Rescue Plan and other one-time sources, we are able to maintain our reserves. This allows us to preserve our Rainy Day Reserve for future uncertainty and risk. To hedge against future risk and uncertainty, the proposed budget creates two new reserves that will help to manage unforeseen costs due to potential FEMA reimbursement disallowances and to manage future budget shortfalls.
Through the end of June, the Board of Supervisors’ Budget and Appropriations Committee will hold public hearings on this proposed budget, and will make recommendations to the full Board. In July, the budget is heard and voted on by the full Board of Supervisors and will return to me for my approval, typically by August 1st.