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Smart Voter
San Francisco County, CA November 3, 2009 Election
Proposition A
Budget Process
City of San Francisco

Charter Amendment - Majority Approval Required

Fail: 0.0% Yes votes ...... 29,414 / 30.11% No votes

See Also: Index of all Propositions

Results as of Nov 10 4:00pm, 100.0% of Precincts Reporting (428/428)
22.0% Voter Turnout (99,649/451,988)
Information shown below: Summary | Fiscal Impact | Official Information | Arguments |

Should the City Charter be amended to require the City to develop binding long-range financial policies, to adopt a two-year budget cycle, and to create a five-year financial plan to forecast expenditures and revenues?

Summary Prepared by LWVSF Pro & Con Guide:
Currently, the City adopts an annual budget by July 1. The City is not required to engage in any long-term financial planning or to adopt financial policies that guide the Board of Supervisors and the Mayor in creating the City's annual budgets. The Proposal: Under Proposition A, the City would move from a one-year budget cycle to a two-year budget cycle. Annually, the Mayor would submit to the Board of Supervisors a proposed rolling two-year budget, balanced for each fiscal year, and the Board would adopt a two-year budget every year. The Mayor and the Board would also have the power to establish a fixed two-year budget cycle for certain departments. Under the fixed two-year cycle, the Mayor would submit a two-year budget for affected departments, and, if approved, that budget would remain in place for two fiscal years unless the Controller reported that the revenue or expenditure projections on which that budget was based had significantly changed. Under Proposition A, the Mayor and the Board of Supervisors would retain the power to introduce amendments to the budget at any time during the budget cycle. This proposition would also institute several financial planning measures. Pursuant to Proposition A, the Controller would propose a set of long-range financial policies for the City. These policies would address, at a minimum, the creation and maintenance of adequate City reserves, the City's use of volatile or fluctuating revenues, the City's issuance of debt, and any extraordinary budget or financial measures that might be needed to deal with natural disasters. The Controller's proposed financial policies would have to be approved by the Mayor and two-thirds of the members of the Board of Supervisors. Once adopted, the policies would be binding; the City would not be allowed to adopt any budget that the Controller deemed inconsistent with any of the financial policies. However, the Board of Supervisors would have the power, by a two-thirds vote, to suspend the policies for a single fiscal year. Additionally, every three years, the Mayor would propose a five-year financial plan that addresses expenditures, revenues, and strategic goals for most City departments. The five-year plan would be adopted by the Board of Supervisors, and this plan would be used to guide the budget process for those departments in future years. Proposition A would require labor agreements for all City workers to be submitted to the Board of Supervisors no later than May 15 to be adopted for the upcoming fiscal year beginning July 1. A new labor agreement submitted after the deadline would not be effective until July 1 of the following fiscal year (more than a year in the future), unless it was cost neutral or resulted in a cost savings to the City. This proposition would also give the Board of Supervisors the power to decide how to notify the public of certain Board proposals and actions, removing the requirement that these notices be published annually in an official City newspaper.

Fiscal Impact from The Controller of San Francisco:
The Controller states the following: Should the proposed charter amendment be approved by the voters, in my opinion, it would not in and of itself affect the cost of government. The charter amendment makes changes to the City's budget and financial processes which are likely to stabilize spending through requiring multi-year budgeting and financial planning. The amendment makes four significant changes to the City's financial processes and policies:
1. Specifies a two-year (biennial) budget, replacing the current annual budget;
2. Requires a five-year financial plan which forecasts revenues and expenses and summarizes expected public service levels and funding requirements for that period;
3. Charges the Controller's Office with proposing to the Mayor and Board of Supervisors financial policies addressing reserves, use of volatile revenues, debt, and financial measures in the case of disaster recovery. The City would be required to adopt budgets consistent with these policies once approved;
4. Standardizes the processes and deadlines for the City to submit labor agreements for all public employee unions at May 15. Overall, the proposed changes would cause the City to budget less in some years, and to fund the budget with reserved funds or new revenues in other years, but the total amount of City revenue or expenditure would not be directly affected.

Official Sources of Information

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Arguments For Proposition A Arguments Against Proposition A
1. Proposition A would improve the City's financial planning and budgeting by requiring the City to look ahead to future revenues and expenditures when adopting budgets.
2. This measure would improve the stability of social services and public health and safety by encouraging the City to plan for anticipated revenue declines so that abrupt cuts are not required to maintain a balanced budget.
3. Proposition A would bring the City in line with standard financial planning practices.
4. Having all labor contracts finalized at least 45 days before the fiscal year begins would allow for a more transparent and efficient budget process

1 Proposition A is not needed because the law already requires certain agencies, including the Controller, to issue a three-year budget report every year. 2 Budget projections on which multi-year budgets are based often turn out to be incorrect.
3. Proposition A reduces accountability because it gives the Controller, an appointed official, power over the budget at the expense of elected officials; it also reduces public hearings regarding agency budgets on fixed two-year budget cycles from every year to every two years. 4 Failure to finalize labor contract negotiations before May 15 means that these employees would be without a new contract for over a year

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Created: December 29, 2009 12:08 PST
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