A tax windfall arrived the same day critical decisions were being hammered out for the upcoming fiscal-year budget.
The Board of Supervisors Budget and Finance Committee has been reviewing Mayor Gavin Newsom’s proposed $6.5 billion city and county budget for the fiscal year that begins today. The board has made it a priority to find savings in order to reject a number of Newsom’s controversial proposals, such as contracting out city and county services, and allowing people to pay a fee to bypass a lottery system to convert their building units into condominiums. Combined, the proposals total about $20 million.
The committee was working to find about $20 million to restore cuts made to social services in Newsom’s budget proposal, which closed a $483 million deficit
On Wednesday, the city controller reported that property transfer taxes — which are assessed on the value of property when sold — would come in higher than expected for June. Instead of the monthly average of $5.6 million, The City will receive $20.8 million. That unexpected revenue was $13 million more than assumed in Newsom’s proposal.
How to spend the transfer tax money is just one part of a larger fight over Newsom’s budget proposal.
Members of the board have criticized Newsom’s proposal for using one-time revenue to help balance the budget. They have said Newsom should support tax increases, as The City is also projected to face budget deficits in years to come. Supervisors are considering placing several tax measures on the November ballot.
Newsom’s budget proposal contains $15.5 million in new or increased fees, including a nonresident fee for entry into the Botanical Gardens and a new fee charged to motorists involved in accidents to offset costs for Fire Department cleanup. It also includes $174 million in one-time revenue.
The board’s Budget and Finance Committee, chaired by Supervisor John Avalos, was scheduled to finalize its budget decisions Wednesday during a meeting set to start at 5 p.m. That meeting, however, was postponed as negotiations between Newsom and members of the board continued through the evening and into the night.
The full board is expected to take its first vote on the revised budget July 20.