Updated January 7, 2009.
There’s a lot of confusion about what’s going on with the budget, thanks in no small part to under-reporting and the dearth of good explanations of how the City’s finances work. We’ve attempted to fill part of that gap below the fold.
In December, the Board of Supervisors’ Government Audit and Oversight Committee (comprised of Supervisors David Campos, Sophie Maxwell, and Aaron Peskin) reviewed a proposed change to the City’s budget introduced by Board President Aaron Peskin. This shift was to be a “de-appropriation,” meaning that it is a change in the budget which removes assigned funding. In this case, the budget would lose $123,632,887. These cuts come from literally dozens of departments, including the Arts Commission, the Department of Children, Youth and Their Families, the District Attorney, the Department of Public Health, the Office of Economic and Workforce Development, the Fire Department, the Human Services Agency, the Human Rights Commission, the Mayor’s Office, the Police Department, and the Board itself. The amount of money represented is pretty massive, by most municipal standards. In scale, Peskin’s de-appropriation leaves Mayor Newsom’s health cuts in the dust.
So how could cuts this extensive be of any benefit whatsoever to poor people in San Francisco?
It works like this: The Board can’t directly vote on the Mayor’s cuts, as these don’t exist in the form of any ordinance or resolution that the Board could act upon. By creating an ordinance which includes these cuts, they now have legislation they can act upon, and which supercedes the Mayor’s cuts. If the Board then removes the worst of the health cuts from the de-appropriation, then funding for these programs is restored. The Mayor could still choose not to spend the allocated funds, but with other cuts already made to balance the budget, he would have less excuse to do so.
Yeah, it confuses us, too.
A budget is a guess. We don’t know exactly how much money San Francisco is going to receive in most of its areas of revenue, this fiscal year. So, the current budget crisis doesn’t mean that we’ve run out of money: It means that the government’s best guess is that the money we’re going to receive won’t be enough to pay as much as we expect to pay for all the things that we as a city want to do. The typical response to situations like this is to cut our costs: If we spend less, then our funds should meet our expenses.
And everyone knows that there will have to be cuts in this budget crisis: It’s simply unavoidable. However, there are too many cuts: We cannot continue to be a city that cares humanely for its citizens with the amount of money that the government expects to bring in. What’s more, the cuts already made carry into future years, meaning a serious human catastrophe for San Francisco stretching years into the future. This is something we can’t allow to happen.
If you don’t have enough money for your expenses, your only alternative to cutting costs is to raise more money: So, we need more taxes. (It’s important to bear in mind that while some potential taxes will be paid by a large portion of us, a large number of the kinds of the taxes that are being considered would mostly affect larger businesses and the extremely wealthy.)
New taxes in cities and towns in California have to be approved by a two thirds majority of voters, which means that taxes can only come into being when we have an election. The San Francisco fiscal year runs from the beginning of July to the end of June. There is no election currently scheduled between now and then. Thus, in order to create enough revenue to maintain health and human services programs past June of this year, we’re going to need a special election.