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Health Commission approves DPH two‑year budget plan using one‑time measures to buy time
Summary
The Health Commission approved the Department of Public Health’s proposed fiscal 2021–22 budget that relies heavily on one‑time solutions and reserves to cover a projected multi‑year city shortfall while preserving services in year one; commissioners flagged long‑term risks and the need for clarity on federal reimbursements.
The Health Commission voted to approve the San Francisco Department of Public Health’s proposed budget for fiscal years 2021 and 2022 after presentations from CFO Greg Wagner and Budget Director Jenny Louis DuPage on the department’s response to mayoral deficit instructions.
Wagner described the citywide context: the mayor’s office provided revised budget instructions in response to COVID‑19 that include a $250 million gap for the current year (which the mayor resolved with DPH assistance) and an outstanding approximately $1.4 billion deficit over the next two years. Departments were directed to plan for a 10% reduction in general‑fund support in year one, 15% in year two, plus an additional 5% contingency. In response, DPH told commissioners it compiled a package of revenue updates, one‑time savings and operational adjustments to avoid immediate service cuts or layoffs in year one.
Jenny Louis DuPage reviewed major line items and assumptions: updated baseline revenues at Zuckerberg San Francisco General Hospital, Medi‑Cal waiver estimates, one‑time Medi‑Cal settlement receipts, EHR/IT savings from decommissioning legacy systems, specific one‑time savings at Laguna Honda (temporary census impacts and kitchen closure savings), and a CARES Act assumption of about $28.2 million expected but not yet fully allocated. The department said it had identified roughly $75–113 million in year‑one reductions plus potential one‑time solutions (reserves, capital deferrals and debt financing) and remained about $2.8 million short of the mayoral instruction after these measures.
DPH staff emphasized the plan’s intent: prioritize services for vulnerable populations while using one‑time resources to "buy time" and avoid immediate service‑level reductions. Wagner said the department preferred this approach because it preserves capacity to respond to COVID‑19 and to maintain momentum on other initiatives such as behavioral health and quality management.
Commissioners acknowledged the speed and depth of the department’s work but expressed concern about medium‑ and long‑term fiscal risk. Several commissioners asked for more detail on assumptions about federal funding (including FEMA reimbursements and CARES Act allocations), how mental‑health investments like Mental Health SF will be prioritized, and whether the city will need deeper adjustments in year two and beyond. The department said it will return with further detail as COVID spending plans are finalized and as the mayor’s office and Board of Supervisors craft the city’s balanced budget.
The commission approved the budget by roll call. The department will submit the plan to the mayor and controller, participate in July hearings, and expect the mayor’s balanced budget submittal on August 1 followed by Board of Supervisors hearings in August and September.
