San Francisco Budget Committee Reviews Financial Outlook and Approves Two-Year Budget - Feb 16, 2022
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San Francisco Budget and Appropriations Committee Meeting - February 16, 2022
The Budget and Appropriations Committee, chaired by Supervisor Matt Haney and joined by President Shamann Walton, Supervisors Ahsha Safaí, Hillary Ronen, and Gordon Mar, held a regular meeting on February 16, 2022, to review the city's financial outlook, budget instructions, and a six-month budget status report. The committee also voted on a resolution adopting a fixed two-year budget cycle for three enterprise departments.
Consent Calendar
- Resolution 211267 – Adopted a fixed two-year budget cycle for the Airport, Port, and Public Utilities Commission for fiscal years 2022-2023 and 2023-2024. The resolution defines terms and sets deadlines. The committee voted to forward the resolution to the full Board of Supervisors with a positive recommendation (5-0).
Public Comments & Testimony
- David Pilpel (public comment on Items 2 & 3) – Expressed support for the improved financial forecast and commended fiscal discipline at City Hall. He agreed with focusing on basic services within existing means and urged limiting salary growth while filling vacant positions. He also requested a report on reductions in unfunded pension and post-retirement benefit liabilities.
Discussion Items
- Items 2 & 3: Five-Year Financial Plan Update and Mayor's Budget Instructions – Ashley Groffenberger (Mayor's Budget Director) presented an improved financial forecast projecting a $108.1 million surplus for the upcoming two budget years (FY2022-2023 and FY2023-2024), driven by growth in general fund revenues and a significant reduction in employer pension contributions. The structural deficit has fallen to approximately $150 million. The Mayor's budget instructions emphasize restoring vibrancy through clean and safe streets, recovery of the economy, and core service delivery without net new costs. Departments are directed not to increase general fund support but to reprioritize within existing budgets and fill vacant positions. Risks include the ongoing pandemic, economic recovery pace, state ballot measures, and potential changes to excess ERAF. Committee members discussed the vacancy rates, revenue assumptions (including new taxes like Prop I and Prop L), and the structural deficit.
- Item 4: Six-Month Budget Status Report (FY2022-2023) – Michelle Allersma (Controller's Office) presented the report, showing a projected $32.7 million increase in the current year ending balance compared to the prior forecast. Key factors included higher-than-expected real property transfer tax (due to a few large transactions like PG&E headquarters), state subventions for sales tax, and salary savings from vacancies. However, the city faces challenges with record absences during the Omicron surge, rising workers' compensation claims (projected $11.4 million overage citywide), and staffing shortfalls in police and fire departments. The report also noted that $7.4 million has been appropriated for outreach and ambassador expenditures, and $2 million in COVID emergency funds were redirected to the Tenderloin emergency. Questions focused on police and fire overages, workers' comp claim trends, and the use of reserves.
- Item 5: Updates on the City’s Economy, Financial Condition, and Other Issues – Ashley Groffenberger stated there were no new updates beyond what was already presented. The hearing was continued to the call of the chair.
Key Outcomes
- Item 1 – Moved to the full Board of Supervisors with a positive recommendation (5-0).
- Items 2 & 3 – Hearings filed (5-0).
- Item 4 – Hearing filed (5-0).
- Item 5 – Hearing continued to the call of the chair (5-0).
- The committee will reconvene as the budget process continues, with the Mayor's proposed budget expected on May 1, 2022, and full budget submission on June 1, 2022.
Meeting Transcript
I'm Matt Haney, Chair of the Budget and Appropriations Committee. I'm joined by committee members President Walton. Supervisors Ronan and Safai and Mar. Our clerk is Mr. Brent Lipa. And I want to thank Matthew Ignao from SFgov TV for broadcasting this meeting. Mr. Clerk, do you have any announcement? Yes, Mr. Chair. The minutes will reflect that committee members participated in this remote meeting through video conference to the same extent as though physically present. The board recognizes that public access to city services is essential. And invite part public participation in the following ways. Public comment will be available on every item on this agenda. Either channels 2678 or 99 and SFGOVTV.org or streaming the public call in number across the screen. Each speaker will be allowed one minute to speak. Oh, sorry, we'll be allowed. Sorry, we'll be allowed two minutes to speak. Comments or opportunities to speak during public comment period are available via phone call by calling 415-655-0001. Meeting ID 2480571739. When connected, you will hear meeting discussions, but you will be muted and in listening mode only. When your item of interest comes up, please dial star three to be added to the speaker in line. Best practices are to call from a quiet location. Speak clearly and slowly. Hand turned down your television, radio, or streaming device. Alternatively, you may uh submit public comment in either of the following ways. Hi email myself, Brent Halipa, the budget and appropriations committee clerk at B R E N T dot J A L I P A at S F G O V dot O R G. If you submit public comment via email, we'll be forwarded to the supervisors and will be included as part of the official file. Written comments may be sent via U.S. Postal Service to City Hall 1. Dr. Carlton B. Goodlit Place, room 244, San Francisco, California, 94102. And any items uh that uh acted upon today are expected to appear on the Board of Supervisors Agenda of March 1st, unless otherwise stated. Uh Mr. Chair, that concludes my comments. Thank you. And we have our first item, which um, if you could please call item one. Thank you, Chair Haney. Item number one is a resolution adopting a fixed two-year budgetary cycle for the following various city departments, airport, port, and public utilities commission for fiscal years 2022 to 2023 and 2023 to 2024. Uh defining terms and setting deadlines. Uh, members of the public who wish to provide uh comment on this item should call 415 65501. Meeting ID is 2480 0571739, then press pound twice. If you haven't already done so, please dial star three lineup to speak. Assistant prompt will indicate you have raised your hand that please wait until the system indicates you have been unmuted, and you may begin your comments. Mr. Chair. Thank you. And we have Ashley Grofenberger from the mayor's budget office. Welcome back.
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