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Controller's office: state budget cuts leave San Francisco with roughly $8 million shortfall after reserves
Summary
A controller's office update to the Board's Budget and Finance Committee said state budget actions will reduce San Francisco revenues and services by an estimated $26.5 million; with $18 million in local reserves set aside, the city faces an approximate $8 million gap and the mayor has 21 days to propose fixes.
Smita, a controller's office presenter, reported to the Budget and Finance Committee that the state budget will produce a preliminary negative impact to San Francisco of $26,500,000. "We have a negative impact of $26,500,000 with a reserve of $18,000,000 leaving a gap of approximately $8,000,000," she told supervisors.
The presentation broke the estimate into major program areas: about $16 million in Department of Public Health losses (including cuts to prevention, AIDS programs and the elimination of Prop 99 tobacco money for emergency services), and roughly $9.6 million in Human Services reductions. The controller's office said some items changed from earlier estimates because the legislature restored funding for certain programs and some projected cuts (for example, to the Healthy Families program) were removed.
Department and county finance staff warned that several reductions remain uncertain because the state has not yet issued implementation guidance. Phil Arnold of the Human Services Agency said eligibility changes to In-Home Supportive Services (IHSS) are not yet accompanied by county instructions; therefore any potential savings are "uncertain" and appealable. DPH Chief Financial Officer Greg Sass said much of his department's largest exposure is an estimate derived from projected Medi-Cal changes; he described the $8.1 million figure as an extrapolation and contingent on federal decisions about eligibility and stimulus-related rules.
The mayor's budget director, Greg Wagner, told the committee the mayor's office will deliver a balancing plan within the 21-day window identified in the adopted budget. That plan, Wagner said, will prioritize uses of the $18 million set aside as a contingency and include proposals to minimize loss of federally matched dollars.
The committee did not take immediate budget action but directed staff to include the updated figures in the mayor's upcoming plan and to return with more detailed department-specific impacts.
