With a new mayor and Board of Supervisors being sworn in Wednesday, it’s time to look at the most daunting policy domains they’ll face as they all return to work. All are formidable as San Francisco emerges from one of its most challenging periods in recent history. Here are the further challenges up ahead:
The deficit and services
It may not be the sexiest or most high-profile issue at the beginning of the year, but it will eventually become one: the city’s Covid-ravaged budget, with a deficit of over $876 million over the next two years. It’s an issue that should be front and center when mayor-elect Lurie is sworn in. Most of that red ink emerges in the second half of the budget cycle. Outgoing Mayor London Breed has already advised city departments to prepare for cuts of up to 15 percent, including the possibility of hiring freezes or layoffs. The new mayor will ultimately decide how close to the bone the reductions will be initially.
We’ve added the caveat “initially” because another major player will, of course, be the budget chair at the Board of Supervisors. The November election has shifted the board ever slightly toward the political center, and the two likely frontrunners for board president, Rafael Mandelman and Myrna Melgar, have both been swing votes on the board. It’s the president who picks the budget chair.
Dynamics of the vote, especially if it goes into multiple rounds as it did back in 2023 when Aaron Peskin, already having had the job twice, was elected after 17 votes. In this context, conventional wisdom has Mandelman assembling a coalition with more moderate-leaning members like Matt Dorsey and Joel Engardio, and Melgar doing likewise with progressive-leaning members like lame-duck Shamann Walton and rookie Jackie Fielder. According to City Hall sources, this is looking difficult.
According to a source, a continuing deadlock between Mandelman and Melgar could result in a more center-leaning moderate freshman supervisor taking the job. It wouldn’t be the first time. David Chiu became board president as a freshman in 2009 and was reelected twice.
The increase in possible scenarios may allow incumbent budget chair Connie Chan to keep her job. The city’s labor unions, a significant constituency of hers, will continue to have a stronger voice in budget negotiations. The question for the new administration then becomes whether it can address at least some of the more painful budget questions early on and halt what some see as largess to the city’s human services contracting nonprofits. Lurie has ties to that community but also promised to make them more accountable.
Public safety as public order
Much of the politics of last year’s race for mayor was dominated by the nexus of drug addiction, homelessness, and persistent, often unreported petty crime that has poisoned downtown’s street life. It’s been part of the city for decades, and it’s tolerated because, up until recently, it’s been contained in a handful of central neighborhoods. The pandemic emptying downtown and the shopping districts coincided with a marked increase in drug overdose deaths, and scenes of disorder associated with open-air drug use spilled over their usual boundaries, generating citywide outrage.
As the representative for District 6, which is home to much of the nexus, and who has campaigned on aggressively engaging the city’s street drugs problem, it’s no surprise that Matt Dorsey has come out the gate with a proposal to arrest up to 100 people a day who are caught using drugs on the streets and putting them in compulsory detox. Nor is it surprising that the progressive side of the board has already voiced objections to the plan.
Mayor-elect Lurie made several campaign promises on the issue, including creating 1,500 new shelter beds within the first six months of his term and another 1,000 beds later on to facilitate the clearing of encampments and a shutdown of open-air drug markets. In addition to promising more arrests of drug dealers, he’s also proposed using ankle monitors to enforce stay-away orders for those arrested dealers immediately. However, Lurie has also promised to “pull police back” from being first responders to street incidents rooted in drug use. The question is whether the velvet-glove-first approach will work, especially given the projected fiscal climate.
“With a new mayor and Board of Supervisors being sworn in Wednesday, it’s time to look at the most daunting policy domains they’ll face as they all return to work.”
Regarding public safety in general, Lurie has dedicated one of his new policy chief positions to that space and has designated Paul Yep, a former San Francisco Police Department commander, to the position. This is undoubtedly a political shout-out to the city’s Chinese-American community, which bore the brunt of much of the city’s crime problems during the pandemic. Given the possible nature of his departure from the department, it may also reflect a desire for change in the agency’s leadership.
Affordability
San Francisco has long endured a housing shortage, exacerbating an affordability crisis. Policy inroads to solving the housing shortage were enacted by Mayors Ed Lee and London Breed, who also supported even more aggressive measures at the state level. The mayor-elect has inherited a stage set for further implementation of those solutions, which he’s largely promised to do: shrinking development timelines and costs and exploring new development strategies. Part of that is exploring new financing mechanisms, including a new public financing entity for housing.
Lurie has already designated Ned Segal, a former chief financial officer at Twitter with significant finance experience, as the czar for housing development and revitalizing downtown. That move may initially seem confusing, but on Monday, he also announced Alicia John-Baptiste, recently of the San Francisco Bay Area Planning and Urban Research Association, as the “czarina” for infrastructure, climate, and mobility. This presumably includes transit and streets, which have become the new sore spots in San Francisco politics.
Transit and housing are inexorably linked as land use issues. At least some of the emerging constituencies mad over a perceived “war on cars” are also leery of housing development. It wouldn’t be surprising to see these two deputies coordinate their efforts. The fiscal knock-off effects of the pandemic, including the rise of robotaxis to the detriment of parking revenue, have also eviscerated transit funding.
The economy will be a significant factor in making more housing practical. The pandemic’s economic toll has resulted in San Francisco sinking to a 12-year low in home production. Assuming the winds in Washington allow for smooth economic sailing, this could lead to policies where housing and transit uphold each other — assuming those in charge can navigate the increasingly thorny politics behind them.
