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Mayor Lee Presents Proposed Balanced Budget for Fiscal Year 2012-13 & 2013-14

Two-Year Budget Proposal Creates Jobs & Invests in Infrastructure, Neighborhoods & Local Economy

5/31/12— Mayor Edwin M. Lee today presented his proposed two-year balanced budget for Fiscal Years 2012-13 and 2013-14. The City’s first Two-Year Budget closed a projected $263 million General Fund deficit for the coming Fiscal Year 2012-13 and $375 million deficit for Fiscal Year 2013-14. The Mayor’s proposed balance budget is the result of hard work and collaboration by the City’s elected officials, residents, departments, community organizations, employees and a wide range of other stakeholders.

“Because of the discipline we have put into our budget process with Two-Year Budgets and Five-Year Financial Planning, the strategic investments we have made in job creation, and our commitment to reforming our pension and health care systems, San Francisco’s economy is now recovering and our reserves are growing,” said Mayor Lee. “This is good news, but it did not come without commitment and sacrifice. We can now continue our investment in job creation and growing our economy while sparing the City the deep cuts we have experienced over the last several years. The hard work is not done. We must remain fiscally responsible and continue the structural reforms and good government policies we pursued that helped us get to this point. This budget reflects my commitment to innovate, create jobs and invest in our City’s infrastructure, housing, small businesses and neighborhoods.”

Mayor Lee’s budget includes investments that ensure that people who live, work and visit San Francisco feel safe; investments that protect the social safety net and supports seniors, youth and low-income and working class families; and investments that support diverse neighborhoods, the City’s critical infrastructure and thriving commercial corridors.

Financial Stability
The Mayor’s Two-Year Budget reflects the financially responsible goals that the City has pursued over the last several years – through Five Year Financial Planning, disciplined financial policies and pension reform. The budget grows the City’s General Reserve from $25 million in FY 2011-12 to $32.1 million and $41.4 million in FY 2012-13 and 2013-14, respectively. The City’s Budget Stabilization Reserve also continues to grow by $17.8 million in FY 2012-13 and another $7.3 million in 2013-14. In addition Mayor Lee has included a $15 million state reserve in his FY 2012-13 budget.

Involvement. Mayor Lee recognizes that achievements as a City are founded in commitment to hear directly from residents, communities and neighborhood organizations about what matters most to them. Mayor Lee co-hosted six district-based budget town halls with all of the members of the Board of Supervisors to hear from the public, met with numerous stakeholders, convened dozens of meetings with community organizations, commissions, labor organizations, departments, business owners, and activists including a Google Hangout to get the perspective of the tech community to work for greater transparency and collaboration around the budget process.

Agreements were reached with the City’s employee unions, saving the City more than $28 million, protecting City services, putting people back work 12 more days a year and enacting improvements to control employee health care costs. While protecting the economic recovery, agreements also included a modest wage increase in the second year to employees who have sacrificed over the last several years.

Investment. Mayor Lee’s proposed budget puts San Franciscans back to work, doing more to strengthen job creation and the economy. San Francisco’s unemployment rate dropped from 9.6 percent in early 2011 to 7.4 percent today, the lowest unemployment rate since 2008 and created 22,500 net-new jobs in San Francisco in just the last year. The Mayor’s budget invests in strategies that incentivize job creation and train and place residents for the jobs of the 21st century.

Jobs & Economic Development
The Mayor’s budget funds workforce training initiatives for technology, health care, construction, hospitality and more, partnering with those industries to train San Francisco residents with the skills they need to win the jobs of the future and place them in those jobs being created in San Francisco.

The Mayor’s budget contains new investments in support for the local manufacturing industry and companies through SFMade in efforts to expand and develop international markets for San Francisco companies and products in Asia, Latin America and India. By creating the climate and the conditions that give investors and entrepreneurs confidence in the City, and support the environment that allows so many innovative companies to grow and create jobs – from a neighborhood small business to a tech startup to a thriving global headquarters company.

The Mayor’s budget also more than doubles neighborhood grants available to commercial districts, and includes a $4 million commitment to neighborhood commercial districts through the new Invest in Neighborhoods Strategy, the creation of a Jobs Squad to help small businesses and a recapitalized Small Business Revolving Loan Fund.

With the State’s elimination of redevelopment, the Mayor’s budget invests significantly in economic development initiatives on Third Street in the heart of Bayview to stabilize businesses and attract new ones. Central Market, especially Sixth Street where the elimination of Redevelopment has left a gap in services, will also be transformed with new investments. With community partners, the City will support businesses that are there, attract new ones, and keep the area clean and safe.

Capital
The Mayor’s proposed budget includes $441 million in smart capital investments that are recommended as part of the City’s Ten-Year Capital Plan to improve and invest in the City’s infrastructure. Over the next two years, the City will invest in and improve water, wastewater and power infrastructure, begin implementing the Airport’s Runway Safety Area Plan, continue our efforts to maintain City assets and promote ADA accessibility, continue investing in our waterfront piers and Port facilities including the Cruise Terminal project – all putting San Franciscans back to work. Over the next two years, these investments will support more than 2,900 jobs in San Francisco.

The City will continue to invest in parks and open space. Joining with members of the Board of Supervisors, Mayor Lee introduced a proposed $195 million 2012 bond measure to make parks safe, clean and inviting for everyone.

Public Safety
Mayor Lee’s proposed budget also includes a Six-Year Police and Fire Hiring Plan that will train the next generation of San Francisco public safety personnel. Over the next six years, new police officers in addition to the civilian workforce will immediately put more police out on the streets and over the next six years, the San Francisco Police Department will reach the City Charter mandated 1,971 officers. The budget also includes hiring new firefighters and emergency medical personnel over the next six years to ensure our City’s Fire Department is appropriately staffed.

The State is continuing its public safety realignment effort. San Francisco will increase services for people returning to the community with strategic support in housing, mental health and substance abuse treatment and job training.

Housing
The Mayor’s budget also redoubles efforts to expand housing opportunities and build more housing in San Francisco for people of every income level. Creating affordable and middle class housing will also help build the economy and create jobs. The City will invest in more housing and the Mayor has proposed a Housing Trust Fund measure for November 2012 to create a permanent source of revenue to fund the production of housing in San Francisco at every level of the economic spectrum.

Education
Mayor Lee will invest in the future and that includes investing in the youth of San Francisco. The Mayor is proposing releasing $6 million of Rainy Day Reserve funds to support the San Francisco Unified School District (SFUSD) in the current fiscal year as a response to the State’s deep cuts to education. Mayor Lee is committed to making sure the City’s youth are going to receive an outstanding public education, be college ready and ready for the 21st century workforce.

The Mayor’s budget also includes creation of a new, independent Office of Early Care and Education that consolidates services and uses existing resources to improve policy coordination, maximize resources and provide a single line of authority for the City’s investments in early care and education.

Innovation. Cities like San Francisco thrive because of their ability to cultivate innovative ideas. This is why Mayor Lee has reached out across the City’s departments and communities to find innovative ways to bring costs down while allowing the City to continue providing the essential services that keep neighborhoods and diverse communities moving in the right direction. San Francisco must as City government continue to innovate to meet the demands of local government in the 21st century and build on the incredible talents of both the public sector and the private sector.

“In the coming year, we will update our City’s Five-Year Financial Plan, and I am challenging myself, our departments, and our community partners to shift to a longer-term view of our City’s finances, and begin to think practically and strategically about the steps we need to take to ensure San Francisco remains the exciting, diverse, and thriving City we love,” said Mayor Lee. “I look forward to working with the Board to ensure our residents receive quality services, while providing a balanced budget and continued economic recovery.”

The Mayor’s proposed balanced budget for Fiscal Year 2012-13 and 2013-14 is available online, go to: http://sfmayor.org/index.aspx?page=460 .

Last updated: 5/31/2012 12:09:14 PM