Mayor Lurie wants to close S.F. budget deficit by cutting roughly 1,400 city jobs

San Francisco Chronicle​

4 days ago

Mayor Daniel Lurie plans to close San Francisco's massive budget deficit by slashing about 1,400 city jobs and eliminating about $100 million in grant and contract spending.
The vast majority of the positions that Lurie seeks to cut in his first two-year budget proposal, which he was set to unveil Friday, are vacant. But as many as 150 are filled.
Some of the filled jobs are expected to be lost through retirement and attrition while some would be eliminated outright under the mayor's proposal. However, it remains unclear how many or exactly which departments will see job cuts.
Lurie is also seeking to significantly reduce City Hall's spending on contracts and grants, aiming to cut $100 million in the second fiscal year. The mayor's goal was to bring city contracting closer to pre-pandemic levels, adjusted for inflation.
Lurie's spending proposal will now head to the Board of Supervisors' Budget and Appropriations Committee, which is set to review and revise his plan in June. The full board must approve the budget in time for Lurie to sign by Aug. 1.
News of the job cuts was first reported by the San Francisco Standard.
The mayor's proposal is an attempt to close a roughly $800 million two-year budget gap as San Francisco's government expenses rise faster than its projected tax revenue, which is suffering partly due to the city's struggling downtown and sluggish tourism.
Lurie sought to rely less on temporary solutions to close the budget gap, as the city had done in prior years. But the city still plans to use $40 million in one-time funds for costs such as capital improvements and the purchasing of necessary equipment.
The mayor's office is also planning to set aside $400 million in a reserve fund to prepare for cuts in state and federal grants to the city. Right now, the city gets about $2 billion from the federal government, according to the San Francisco Controller's Office. Some departments, like the city's human services agencies and homelessness department, rely heavily on federal funds.
Lurie told the Chronicle in a statement that his budget focused on 'spending only the money we have' and 'prioritizing core services so we can do the basics well.'
'I promised San Franciscans accountable leadership in City Hall, and I am accountable for delivering a budget that tackles our structural deficit and puts our city on track for a strong recovery,' Lurie said in the statement. 'Even facing significant uncertainty at the state and federal levels, we are building a budget that will drive San Francisco's comeback.'
The mayor's office previously told departments to plan for 15% cuts in the coming fiscal year, and Lurie's budget director in April instructed city agencies to dig deeper after some didn't comply with those instructions. Many departments will still see their overall spending increase because of salary growth guaranteed by union contracts.
Lurie already decided that he wouldn't cut funding for police officers, prosecutors and other front-line public safety workers despite the budget constraints. He is also seeking to overhaul how the city spends money from a tax to fund homeless services that was approved by voters nearly seven years ago.
Critics of the city government's spending have often complained that its massive budget isn't delivering results for San Francisco's residents, who have long expressed concerns about widespread homelessness, open-air drug scenes and empty storefronts.
Lurie, in the past, admitted that the city isn't getting what it pays for: He wrote that San Francisco 'should have unparalleled levels of coordinated service delivery and collaboration,' given its large budget and workforce.
Lurie's proposed budget cuts are reminiscent of similar reductions made by then-Mayor Gavin Newsom during the height of the Great Recession. Newsom cut more than 1,600 jobs and contracted out for hundreds more in his 2009-2010 and 2010-2011 budgets.
Theresa Rutherford, president of SEIU Local 1021 and a 20-year city employee, expressed frustration at the mayor's budget cuts.
"We are deeply disappointed that the mayor has chosen to cut crucial public services that San Francisco residents and small businesses rely on, rather than working with city workers on the pathway forward that we laid out five months ago,' Rutherford said.
Public sector unions like the SEIU have been pushing for Lurie to pressure Airbnb to drop its request for a refund on about $120 million in previously paid business taxes the company said it was overcharged for.
Unions say that Airbnb and other companies are not paying their fair share, and that money the city has held in reserve for business tax litigation could be used to avoid deep budget cuts.
'Corporations that profit off our city's workforce and infrastructure are trying to avoid paying their fair share of taxes, and San Franciscans are paying the price,' Rutherford said.
Board of Supervisors budget and appropriations chairwoman Connie Chan told the Chronicle that she was not surprised by the mayor's proposed cuts, saying that she knew the next month would see 'difficult' negotiations.
In June, Chan and the Board of Supervisors will hear from departments about their proposed budgets and identify potential savings outside of the mayor's proposal.
'As I've indicated before, there are no good options,' Chan said. 'We're going through this budget to prioritize people being housed, people being fed and cared for.'
Chan said she and the mayor 'don't see eye to eye' on some things, but they are aligned in prioritizing public safety and clean streets and on setting aside funds to deal with a potential decrease in federal money.
'We know the (reserves) are not going to be enough,' she said. 'These are things we're talking about and need to be prepared for. So then we're looking at our city attorney David Chiu to continue to fight for the city and guard our resources during this critical moment.'