Mayor Lee tells supervisors pension, retiree-health costs remain challenging; highlights Healthy San Francisco outcomes

Mayor Ed Lee told the San Francisco Board of Supervisors on Tuesday that the city faces continuing pressure from rising pension and retiree health-care costs, urged careful control of salary growth and defended tighter hiring approvals as a near-term strategy to manage budgets.

Lee opened the board’s formal policy discussion by thanking supervisors for placing pension reform on the ballot and stressing that changes to pensions themselves must be approved by voters under the city charter. “Changes to the pension system can only be made by San Francisco voters in our city charter,” Lee said. He said controlling salary growth and a stricter review of vacancy filings are tools the city can use immediately to contain future pension liabilities.

Nut graf: The mayor framed the city’s finances around two long-term obligations — pension benefits and retiree health care — and described administrative steps the executive branch is taking now to limit future cost growth. He also summarized an independent evaluation of Healthy San Francisco and addressed how the city is balancing public-safety and free-speech concerns raised by Occupy SF.

On pensions and retiree health, Lee cited estimates reported to the board that projected pension…