Mayor London Breed Announces Updated Budget Impacts as a Result of COVID-19
$1.7 billion deficit for the current fiscal year and upcoming two-year budget does not include projected COVID-19 emergency response spending
San Francisco, CA — Mayor London N. Breed today announced the City is facing a $1.7 billion deficit in the current year and upcoming two-year budget as result of the economic impact of the COVID-19 pandemic. In the current year, the City must close a $250 million shortfall. For the upcoming two-year budget, the shortfall is projected to be $1.5 billion. These projections assume a slow recovery beginning in late 2020, but if that recovery is delayed due to continued community exposure, the projected deficit could grow.
The report released today was prepared jointly by the Mayor’s Budget Office, the Board of Supervisors Budget and Legislative Analyst, and the Controller’s Office. The report summarizes current projections of the City’s General Fund revenue and expenditures for the five-year period from FY 2019-20 through FY 2023-24.
The City also laid out the current spending for the COVID-19 Emergency Response effort to be approximately $375 million for the current fiscal year. Portions of this spending will be covered by federal and state support, however ongoing costs are largely unknown at this time and any ongoing coverage for these types of expenses is uncertain. The two-year deficit projections do not currently include any ongoing emergency response costs, which are likely to be significant and will add to the already steep shortfalls.
“While from Day One we have focused on confronting this public health emergency, we have also been taking a significant economic hit at the same time,” said Mayor Breed. “With over 100,000 San Franciscans applying for unemployment and an uncertain timeline for recovery, we are in for a long, hard road. This is going to require a lot of tough choices and creative solutions, but I’m confident that we can do the work it takes to get San Francisco through this.”
“The City is working hard every day to avoid the community health impacts we’ve seen from around the country and the world, but the unfortunate truth is that the economic and financial impacts can’t be escaped,” said Ben Rosenfield, City Controller. “The City’s financial outlook has taken a sharp turn for the worse, and while our financial preparation in recent years will soften the blow, extremely hard choices lie ahead.”
The City has delayed its budget process given the public health emergency. The Mayor’s Office will issue revised budget instructions to departments next week, and by June 1st, the Mayor will introduce a balanced interim budget at the Board of Supervisors. This will be followed by a proposed balanced budget to the Board of Supervisors by August 1st. The Board will review, amend, and adopt that proposed budget by September 30th.
The report can be found here: http://openbook.sfgov.org/webreports/details3.aspx?id=2823.