San Francisco’s budget forecasting season kicked off Thursday with some relatively good news: Although The City is expecting a $16 million deficit this coming fiscal year, that’s the lowest budget shortfall in a long time.
At a meeting of the Recreation and Park Commission, Katie Petrucione, the Recreation and Parks Department’s director of administration and finance, said this will be the first year that will not require “deep cuts” to Rec and Park’s budget in years.
Petrucione told the commission:
“The City’s two-year budget outlook is remarkably positive. … It’s the most positive that I have seen in the 14 years that I have been working on budgets in (San Francisco). I think that this is a result of the very strong revenue growth that the City is seeing, along with the fact that pretty much all of the City’s labor contracts are closed, combined with the discipline that has been imposed by having to manage a two-year budget process.”
Petrucione said the Mayor’s budget office is projecting a General Fund deficit of $16 million in fiscal year 2015-16, but is not asking departments taking from the General Fund to slash their budgets this coming year. She said that is a first since she’s been involved in budgeting the City’s money.
Rec and Park will, however, have to absorb cost increases of about $360,000 that are unrelated to employee salaries — like changes to a lease agreement with a golf course, and an increase in costs for trash removal from Sunset Scavenger — plus decreases in revenues expected from various park concessionaires, events in the parks and attractions like Coit Tower, to reflect actual collections. Projections of increased costs are expected to change over the next several weeks as more information becomes available.
Petrucione did caution the Commission that even though the Rec and Park will not have to make deep cuts this year, there still isn’t enough money to meet all the department’s needs:
“The department is still not funded at an appropriate level to properly maintain our parks and open space. … The City’s population is growing. Density is increasing and our existing parks are being used more, which requires additional maintenance.”
“The department is also adding new properties to our portfolio. We acquired three properties last year. … And once these properties have been built, they will require additional gardening, custodial, urban forestry, park patrol and structural maintenance resources. We are also looking at adding even more parks to our portfolio, which will require additional resources to maintain.”
Rec and Park’s current budget is $163 million, she said, based on three primary sources of revenue: the Open Space Fund, the General Fund and revenue raised by the parks.
The Open Space Fund is money set aside from property taxes, which provided Rec and Park with $45.7 million in the current fiscal year. An annual subsidy from the General Fund provided a little over $50 million.
“The department supports itself, in large part, from the property and resources that are under our jurisdiction. … In the current year our earned revenue is budgeted to be $61.4 million to support our operations. These resources include our four parking garages, Stow Lake, the Tea Garden and many more facilities, many of which the department has generated revenue from for decades.”
“In addition our recreation division continues to grow, generating additional revenue every year through improved programming. … Earned revenue in the department has been increasing steadily since fiscal year 2008-09. We are experiencing growth in all categories of earned revenue. … This growth is coming from increased usage of our programs, our facilities, our fields and park amenities, as well as from the success of special events such as Outside Lands.”
Petrucione broke down department expenditures for the Commission: 50 percent of the department’s resources are allocated to park maintenance, 25 percent to recreation programs, 12 percent to maintaining structures, 7 percent supports administrative staff, 3 percent supports park safety and the rest supports the Marina Yacht Harbor, the SF Zoo and volunteer services.
She said 62 percent of the department’s budget goes to paying all Rec and Park staff. The rest goes to things like services from other departments such as heat and power, fuel for vehicles, material costs, worker’s compensation, city attorney costs, telephone services, garbage pickup and other services.