money.jpgMayor banks on federal “manna from heaven”, yet-to-be realized cash to save jobs, prevent city from failing

There’s a simple — if not easy — way to balance a municipal budget without raising taxes or fees (although there are some increased fees inside Mayor Gavin Newsom’s proposed 2010-2011 city budget, released to city officials Tuesday morning and to the rest of the civilized world late Tuesday afternoon at a Mid-Market arts and performance space. “If it were bad news, I would have released it on Friday” before the holiday weekend, Newsom pointed out, so give him that, at least).

What would that way be? Simple: dredge every last dime out of the federal government, and that’s exactly what Newsom did in order to balance a $480 million budget deficit while only laying off 350 city workers and axing merely roughly $80 million in programs and services from a $6.49 billion total budget.

In all, Newsom is banking on federal subsidies, programs and other Big Brother Giveaways to go a long way towards a budgeted $220 million in new revenue for the city government. Events like an antiques show at Candlestick Park, art expos in UN Plaza and other “efficiencies” (read: putting city-owned properties to use to make the city money) will make up the rest, Newsom said.

The new fiscal year begins in exactly one month, but the Board of Supervisors has all month to hold hearings and can tinker with the budget until July, when the final budget must be approved.

Here’s a brief rundown of exactly how Newsom found $480 million where just yesterday there was nothing:

$64 million from an unexpected surplus created during the current fiscal year through midyear cuts, hiring freezes and whatnot;

$61.7 million from union givebacks from public employee units like SEIU, the Police Officers Association and Local 798 of the Firefighters’ Union;

$64.2 million in employee savings, which includes 350 city employees receiving layoff notices and most managers — including Newsom — agreeing to a 10 percent wage cut;

The aforementioned $220 million in new revenues, including fees and new city programs which will hopefully make money;

Which leaves roughly $70 million in services, programs and other fun stuff which, as of July 1, would become non-stuff under Newsom’s plan.

Of course, the devil is in the details, and the budget is thick enough to hide enough Beelzebubs to fill an ensemble cast for “Paradise Lost : The Musical.”

There are new taxes of sorts: Newsom plans on adding five new community benefit districts, meaning five new commercial zones where businesses pay an extra tax.

In Newsom’s words, “hundreds of small solutions” all add up: the budget closes a loophole on online-only hotel reservations for $6 million; and the city cancels music played while telephone callers are on hold for about $10,000.

There’s also other “common-sense belt tightening” that, admittedly, should have been in place years ago, like a citywide protocol for buying office software (rather than department-by-department licensing for MS Office 97, which is what is in place now).

And there are the returns of friendly faces like Newsom’s condominium conversion fee and the privatization of services like health care at the city jail, known as “Proposition Js” to wonks, supervisors and City Hall bloggers.

Still, we have to say, this isn’t nearly as bad as we expected. Of course, it banks heavily on cash from the federal government, dubbed “manna from heaven” by Supervisor John Avalos, chair of the Budget and Finance Committee, a chair from which Avalos is unlikely to get up out of much over the next 30 days as the wrangling and politicking over dollars and cents begins.

For his part, Avalos wants taxes: $100 million worth of new taxes that would be here this year, next year and every year. These would go onto the ballot, where 2/3 of San Franciscans would have to approve them.

“We need ongoing sources of revenue,” he said. “These are one time fixes… we’re relying on manna from heaven right now.”

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  • Paul Hogarth

    Actually, Chris, you don’t need two-thirds to pass a tax measure this November. When the Board of Supervisors is on the same ballot, taxes that go to the General Fund only require a simple majority (whereas on any other ballot, it does require two-thirds.) That’s why progressives are being strategic about the Hotel Fairness Initiative for November.

    Similarly, in 2008 Aaron Peskin pushed two tax measures (closing a loophole in the Payroll Tax and raising the Real Estate Transfer Tax for properties worth over $5 million.) Both needed a simple majority to pass because of the ballot they were on, and both passed.

  • Paul Hogarth

    Actually, Chris, you don’t need two-thirds to pass a tax measure this November. When the Board of Supervisors is on the same ballot, taxes that go to the General Fund only require a simple majority (whereas on any other ballot, it does require two-thirds.) That’s why progressives are being strategic about the Hotel Fairness Initiative for November.

    Similarly, in 2008 Aaron Peskin pushed two tax measures (closing a loophole in the Payroll Tax and raising the Real Estate Transfer Tax for properties worth over $5 million.) Both needed a simple majority to pass because of the ballot they were on, and both passed.