The San Francisco Board of Supervisors’ traditional “add-backs” are a particularly embarrassing City Hall ritual played out each summer at the tail end of each year’s budget process. Add-backs have long been recognized as the smoothest way for supervisors to strip cash from things they don’t like in the mayor’s June 1 draft budget and funnel the money to their own preferred purposes.
What happens first is that the supervisors’ powerful Budget and Finance Committee oversees the cutting of a pile of money — often in the tens of millions of dollars — out of the mayor’s proposed funding choices and adds in any unexpected late revenue. So far, this is all perfectly straightforward politics.
But then every board member goes into closed-door meetings and all supervisors get to make a pitch to add back some of the cuts into spending that will satisfy influential elements of their home-district constituencies. Much of the cash is funneled to community nonprofits that can boast some political clout. In fact, add-backs are a major element in annual funding of The City’s nonprofit service providers, which brings in another whole level of concern about the lack of transparency.
San Francisco funds hundreds of nonprofits. They get paid nearly $500 million a year by The City — over 41 percent of The City’s discretionary budget. A 2009 San Francisco Civil Grand Jury report blasted the lack of municipal oversight in funding nonprofits and blamed add-backs as a significant part of the problem.
The grand jury noted that nonprofits routinely get funded without even being required to show evidence that their programs deliver any positive results. They are generally not required to account in detail how they spent the taxpayers’ money. And many of the nonprofits provide overlapping services. The Board of Supervisors has been using add-backs to reward supportive nonprofits without needing to ask if their programs are worth it.
Mayor Ed Lee paid his first visit to the Editorial Board of The San Francisco Examiner last week and said that during his year in office he is making it a high priority to put the brakes on add-backs reflexively given to nonprofits. Lee has been holding a series of meetings with supervisors and leaders of their home-district nonprofits. He tells each meeting that he wants the add-back requests now, at the front end of the negotiations.
“No more charades,” Lee told The Examiner. As a 21-year city official thoroughly versed in the eccentricities of San Francisco budgeting, his idea is that knowing the real needs of core service providers early during budget preparations can only lead to final results with more transparency and greater accountability.
Lee is absolutely right that it is time for add-backs to be gone. They invite politically motivated excess spending and are a foolishly destructive obstacle to responsible San Francisco fiscal management. “No more charades” indeed.