Controller: General fund projected $96.7M surplus at nine months, transfer taxes at record levels

Michelle Elersema of the Controller's office presented the nine-month revenue and expenditure update, telling the Budget & Finance Committee the city now projects a $96.7 million ending balance in the general fund, an improvement from the six-month report.

Elersema highlighted stronger-than-expected property-related tax revenue (about $60 million above the revised budget) and a projected record $400 million in real property transfer tax, $156 million above budget. Those gains will support a roughly $94.7 million deposit to the Budget Stabilization Reserve under city policy. The Controller's office reported weaker sales-tax receipts (partly tied to a failed November sales-tax measure) and declines in hotel and parking tax receipts, including a partial-year Moscone Center closure.

At the department level, much of the positive variance comes from patient revenue at San Francisco General Hospital, tied to higher-than-budgeted reimbursements and capitation payments; the Controller's office noted this area carries future uncertainty related to federal policy and reimbursement changes. Elersema said the office will issue an updated revenue letter in mid-June with more detail and that, aside from the issues noted, departments are generally on track relative to the six-month report.

Next steps: the committee filed the Controller's nine-month report and the Controller's office will provide an updated revenue letter around June 10 with the team available to answer department-level questions.