San Francisco leaders take on $876 million budget shortfall

SAN FRANCISCO (KRON) – Oakland is not the only city in the Bay Area with a massive budget deficit. San Francisco Mayor London Breed has told city departments that San Francisco faces a budget deficit of $876 million over the next two years, and massive cuts will need to be made.

District 1 Supervisor Connie Chan, who chairs the city’s budget and finance committee, says San Francisco has been spending more money than it earns as expenses increase and revenues drop or stay flat.

“All across the board, we now see a significant decrease of business tax revenue for San Francisco,” she said. 

In her budget instructions, the mayor has advised departments to enact ongoing permanent spending reductions of 15%, but Chan says across-the-board cuts are not feasible.

“The police departments right now, we all know it’s been short-staffed, so to expect them to decrease their budget by 15% and potentially even a hiring freeze, we know that’s not acceptable for our public safety agencies like the police department,” she said. 

The mayor also suggested the possibility of a hiring freeze, but Chan believes that should be for managers only. The mayor also suggests a review of all contracts with outside agencies that provide services. Chan believes that’s a good idea

“We need to look at some of the grant contracts and some of the current existing contracts if they’re not producing results,” Chan said. “We need to realistically, by either terminate them or reduce the dollar amount of spending, and that’s roughly more than a billion dollars annually for the city, and that is really where we need to start first.”

Mayor Breed and mayor-elect Daniel Lurie were not available for interviews. Lurie sent the following statement:

“The budget deficit is a crisis that we must face head-on, and it will require us to make difficult decisions. We can’t simply cut our way out of this nor can we balance the budget on the backs of working people. We need to stop spending more than we can afford while prioritizing investments that are critical to a full economic recovery and the maintenance of essential services.”