San Francisco Budget and Appropriations Committee Hearing on Mayor's Proposed Budget for Selected Departments - May 15, 2024
STREAMING COPY IN PREPARATION — RECORDING AVAILABLE FROM THE ORIGINAL SOURCE
San Francisco Budget and Appropriations Committee Hearing on Mayor's Proposed Budget for Selected Departments - May 15, 2024
The Budget and Appropriations Committee, chaired by Supervisor Connie Chan, convened on May 15, 2024, to hear presentations on the Mayor's proposed budget for FYs 2024-2025 and 2025-2026 for 12 enterprise and non-general fund departments. The committee included Supervisors Mar, Walton, Mandelman, and President Peskin (absent). Chair Chan opened with remarks emphasizing the need to manage spending within the city's means and focus on core missions. The meeting also included public comment and concluded with a vote to continue the items to May 22.
Public Comments & Testimony
- Cyrus Hall (District 7 resident) spoke in support of sustainable transportation, noting that the SFMTA budget represented the best achievable within the current political context. He highlighted reduced fare increases (14% over two years instead of 20%) and a renewed focus on Vision Zero, but warned that without more funding opportunities, service cuts would begin before July 2026. He urged the committee to consider revenue measures like expanding residential parking permits and meter hours.
Discussion Items
- Airport (SFO): Director Ivar Satterell reported 90% passenger recovery (103% international, 85% domestic) and a proposed $1.6 billion budget (up 16%) for FY24-25, with 99 new positions (41 for an Airport Integrated Operations Center). The airport projects a $55 million annual service payment to the city's general fund, the largest ever, growing to $60 million in two years. Chair Chan thanked Satterell for his leadership and noted the airport's successful navigation of the pandemic.
- Board of Appeals: Executive Director Julie Rosenberg presented a modest budget increase with proposed surcharge rate increases of $5 for DBI and Planning permits, and CPI-based adjustments for DPH and Public Works. Appeal volume is 37% below the 10-year average. The department has three full-time employees.
- Child Support Services: Director Karen Roy reported that 93% of $22.4 million collected in FY2023 directly benefited families. The department operates without general fund support, relying on federal and state funds. It has 73 budgeted positions (61.5 filled, 11.5 intentionally vacant). Supervisor Melgar inquired about partnerships with the new Department of Early Childhood; Roy confirmed referral coordination and confidentiality limitations.
- Department of the Environment: Director Tyronju highlighted a record $42 million in grants (45% of the budget), leveraging federal Inflation Reduction Act and Bipartisan Infrastructure Law funds. Only 3% of the budget comes from the general fund. Supervisor Melgar asked about coordination with other departments on climate adaptation; Ju noted participation in the Climate SF group and work orders with PUC, MTA, and DBI (12% of budget).
- San Francisco Law Library: Assistant Director Diane Rodriguez reported a 49% lease savings (approved earlier that morning) and requested future funding for the charter-mandated head of technical services position. The library has seen a 52% decline in filing fees since 2009 and now has only three professional librarians.
- San Francisco Public Library: Director Lambert presented the Vision 2030 strategic plan. Key investments include $4.8 million for a new Ocean View branch in FY26, $3.5 million for capital maintenance, $300,000 for digital collections for incarcerated individuals, and $250,000 for staff de-escalation training. The budget is funded 99% by the library preservation fund.
- Port of San Francisco: Director Elaine Forbes and CFO Nate Cruz outlined three strategic pillars: economic recovery, equity, and resilience. The port has exceeded pre-pandemic revenues and is working on a $13 billion Army Corps of Engineers flood protection plan for the entire 7.5-mile waterfront. New initiatives include in-house security and promotive pathways for maintenance staff. Supervisor Walton asked about local contracting; Forbes reported that 50-80% of contracts go to local small businesses. Walton also raised concerns about flood protection for the Southeast; Forbes confirmed the plan includes that area and may expand to Yosemite Slough.
- San Francisco Municipal Transportation Agency (SFMTA): Executive Director Jeffrey Tumlin described a $214 million budget deficit in FY25-26 due to 62% lower transit revenue and 38% lower parking revenue compared to FY18-19. The budget closes a $12.7 million gap through fee indexing, including reducing a clipper discount from $0.50 to $0.25 (cash fare remains $3). Ridership increased 25% year-over-year and crime on Muni is down 48%. Tumlin emphasized a multipath strategy including SB 1031 (Senator Wiener's regional tax bill) and efficiency gains from transit-only lanes. Supervisors Chan and Melgar pressed for longer-term revenue strategies, including leverage of brand and real estate assets. Chan urged the department to pursue federal grants and cited SFO's concession approach as a model.
- San Francisco Public Utilities Commission (SFPUC): Deputy General Manager Ron Flynn and CFO Nancy Hamm presented a $2 billion operating budget for FY24-25, growing 20% over two years. The agency's affordability policy limits rate increases; a 10-year capital plan was trimmed by $2.7 billion. Of 170 new position requests, 87 are temporary-to-permanent conversions (budget-neutral). The capital plan includes $1.6 billion each year and a $3 billion debt authorization. Supervisor Walton expressed concern about contractors not fulfilling social impact commitments under the SSIP program; Flynn acknowledged the issue and said the agency is pressing contractors to catch up.
- Rent Board: Executive Director Christina Varner reported a $13.8 million proposed budget, with the rent board fee remaining at $59 per unit. The department has grown from 35 to approximately 57 FTEs due to legislative changes. A new data analyst position will improve data modernization. Chair Chan praised the Rent Board's neutral role in helping both tenants and small property owners.
- San Francisco Employees' Retirement System (SFERS): CEO Alison Romano presented a budget tied to operational excellence and technology. The system is 97% funded with $34.8 billion in assets and has exceeded benchmarks over 5, 10, and 20 years. The budget requests 11 new positions (7 previously approved for retirement services, 4 new for IT). Chair Chan questioned the growth in FTEs and its potential future general fund implications.
- Department of Building Inspection (DBI): Director Patrick O'Rearden reported that the department's fees are often lower than other large California cities. A fee study proposes phased increases over three years, using reserves to bridge the gap until full cost recovery in 2027. The budget reduces attrition to maintain staffing levels. Supervisor Melgar asked about IT integration with other permitting departments; O'Rearden said collaboration with Planning and the Permit Center is ongoing.
Key Outcomes
- The committee voted unanimously (4-0, with President Peskin absent) to continue Items 1-3 (Hearing on Mayor's Proposed Budget, Proposed Budget and Appropriation Ordinance, and Proposed Annual Salary Ordinance) to the May 22, 2024 meeting. No final decisions on the budget were made.
Meeting Transcript
Still good morning. The meeting will come to order. Welcome to the May 15 2024 meeting of the budget and appropriation committee. I'm Supervisor Connie Chan, Chair of the Committee. I'm joined by Supervisor Mayor Namalgar and Shaman Walton, hopefully shortly by Vice Chair Rafael Mendelman and President President Peskin. Our clerk is Brent Halipa. I would like to thank SFGov TV for uh broadcasting this meeting. Mr. Clerk, do you have any announcements? Thank you, Madam Chair. Just a friendly reminder to those in attendance to please make sure to silence all cell phones and electronic devices to prevent interruptions during our proceedings. Should you have any documents to be included as part of the file, this should be submitted to myself, the clerk. Public comment will be taken on each item on this agenda. When your item of interest comes up in public comment is called, please line up to speak on the west side of the chamber to your right, my left along those curtains. And while not necessary to provide public comment, we do invite you to fill out a comment card and leave them on the tray by the television to your left by the doors if you wish to be accurately recorded for the minutes. Alternatively, you may submit public comment in writing in either of the following ways. Email them to myself, the budget and appropriations clerk at B-R-E-N-T dot J A L I P A HET SFGOV.org. If you submit public comment via email, it will be forwarded to the supervisors and also included as part of the official file. You may also send your written comments via U.S. Postal Service to our office in City Hall at one Dr. Carlton B. Goodlett. Place room 44, uh room 244, San Francisco, California, 94102. And Madam Chair, that concludes my announcements. Thank you, Mr. Clerk. And uh let's call items one through three together, please. Yes, items one through three. Items one, two, and three consider the mayor's may proposed budget for the airport commission, uh, Board of Appeals, Department of Building Inspection, Child Support Services, Department of the Environment, Law Library, Municipal Transportation Agency, Port Public Library, San Francisco Public Utilities Commission, uh, the residential rent stabilization and arbitration board and retirement system for fiscal years 2024 uh through 2025 and 2025 to 2026. Item number two is a is the proposed budget and appropriation ordinance, appropriating all estimated receipts and all estimated expenditures as of May 1st, 2024. And item number three is the proposed annual salary ordinance, enumerating positions in the proposed budget and appropriation ordinance. Madam Chair. Thank you. And um just this is uh for the general public. Um this is a series of first of the two um uh of the series of hearings specifically on the mayor's proposed budget, considering the May 1st budget. That's really uh drilling down to the budget for enterprise agencies and the selected department. This is not the entire general funded budget. So um with that colleagues, um, before we do start uh our department presentation, I would like to make uh some opening remarks to help just frame this year uh budget process for the public and this committee as well as our city departments. Uh yesterday the controller released their nine months budget status report and then show that we're performing slightly better than projected, but frankly, we still have a long way to go. It has always uh also been clear uh for some time uh that even after we recover from the effect of the pandemic, we will not be going backwards to a time of unprecedented growth in our city and economy anytime soon. It is time that we manage our city budget for this reality. We must manage our spending so that we can continue to offer the critical services that our residents need, but do so within our means. Um, as is often said, our budget is a statement of our values. If that is the case, what does San Francisco's budget say about our values as a city? As this board supervisors, I know what our values are and our charge from our constituency is clear. We must make sure that San Francisco has a strong safety net so that our most vulnerable, our families, our children, and our seniors not only survive, but they thrive in our city. We need to fund programs that have been proven to work, and we need to deliver the city services that residents not only need but deserve. We can do this if we work together to focus each department's budget and services on delivering their core missions. We must have the political will to cut wasteful spending that may feel good, but doesn't deliver services and have measurable results. This is a theme that my colleagues and anyone who has been before this committee should be familiar with.
openpublica.com