January 19, 2024
To: Members of the Ethics Commission
From: Gayathri Thaikkendiyil, Acting Executive Director
Subject: January 24 Meeting Agenda Item 7 – Presentation, public hearing, and possible action on Ethics Commission budget priorities for the Fiscal Year 2024-25 and Fiscal Year 2025-26
Summary and Action Requested
The attached overview is presented for informational purposes only as background on the Ethics Commission’s departmental budget. No action is required at this public hearing. The Agenda item has been noticed for both discussion and possible action should the Commission wish to take action at this meeting after receiving public comment on departmental budget priorities for FY25-FY26.
Budget Submission Deadline
Departmental budget submissions for the Fiscal Years that begin July 1, 2024 and end June 30, 2026 must be submitted to the Mayor’s Office by February 21, 2024. As part of the annual budget process, departments are subject to requirements that took effect in 2020 under Ordinance No. 294-19. That ordinance was adopted by the Board of Supervisors in December 2019 and modified the process for adopting the City’s annual budget with the goal of expanding public input in the development of the City’s annual budget.
Public Hearing on Departmental Budget Priorities
Under the Ordinance, following the issuance of annual budget instructions from the Mayor, departments are required to hold a public meeting concerning departmental budget priorities at which members of the public may provide input. The purpose of the meeting is to allow for public input on departmental budget priorities for the upcoming Fiscal Years prior to the department finalizing its budget proposal for submission to the Mayor’s office. For departments subject to the oversight of a commission, this requirement may be satisfied by holding a public hearing regarding budget priorities at a regular or special meeting subject to both the Brown Act and the Sunshine Ordinance. The meeting must be held at least 15 days prior to the commission’s final approval of the agency’s proposed budget.
Subsequent Public Hearing on Department’s Proposed Budget
The Ordinance also requires that by no later than February 14 each year, agencies must hold a public meeting concerning the department’s proposed budget to allow for public input prior to the agency’s submission of their proposed budget. At that meeting, information provided must include information about the agency’s divisions; budget totals and major changes including new or reduced initiatives and staffing changes; changes in service levels; projected salary savings; and how the agency is meeting budget instruction targets. The Ordinance requires this public meeting to occur no less than 15 days after the public meeting to obtain input on budget priorities. For Commissions, this requirement can be satisfied at a regular or special meeting at which it considers final approval of the agency’s proposed budget.
Mayor’s Budget Instructions for Fiscal Years 2024-25 (FY25) and 2025-26 (FY26)
The Mayor issued annual budget instructions to City departments for FY25 and FY26 on December 13, 2023. The City is projecting a budget shortfall of approximately $799 million with a $245 million deficit in the first year and $554 million in the second year. Therefore, City departments are required to propose cuts of 10% in FY25 and 10% in FY26 from their General Fund budgets. An additional proposed contingency cut of 5% is required in each year as well. The budget instructions to departments are outlined below.
- Reduce general fund support by ongoing 10% in each year.
- Submit contingency proposals of ongoing 5% in each year.
- Do not add new FTE positions.
- Focus on core department operations & services. Eliminate costs supporting non-essential, discretionary or redundant service areas.
The priorities that the Mayor has identified for the City are below.
- Improving public safety and street conditions.
- Citywide economic vitality.
- Reducing homelessness and transforming mental health service delivery.
- Accountability & equity in services and spending.
Following submission of the budget proposals, the Mayor’s Budget Office will evaluate the requests and develop the Mayor’s proposed balanced budget to submit to the Board by June 1, 2024. The Board of Supervisors then considers the budget and must send a balanced budget back to the Mayor for signature by August 1, 2024.
Public Input on Ethics Commission Budget
In preparation for submitting its FY25-FY26 budget to the Mayor’s Office by February 21, as required, the Ethics Commission has planned the following opportunities to receive public input on its budget:
- In accordance Ordinance 294-19, the Ethics Commission has scheduled a public hearing on departmental budget priorities for Wednesday, January 24, 2024. This meeting will be held in person and remotely via Webex and livestreamed via SFGovTV website. For the January 24 public hearing, Commission Staff will present an overview of budget priorities, which appears in Attachment 1.
- Also in accordance Ordinance 294-19, the Commission will schedule a public hearing related to the department’s proposed budget at its next Regular Meeting on Friday, February 9, 2024. At this meeting Staff will provide a detailed presentation on FY25-FY26 budget proposal planned for submission. As a regular monthly meeting of the Commission, this meeting will be held in person and remotely via Webex and cablecast live on SFGovTV. Details and materials for this meeting will be posted in advance of the meeting as required by the Brown Act and Sunshine Ordinance.
- Written comment on the Commission’s budget priorities and proposals may also be submitted to ethics.commission@sfgov.org.