Mayor Lee sets sights on ‘add-back’ budget procedure 

The annual, high-drama budget process known as “add-backs” could come to an end if Mayor Ed Lee has his way. Every year, the Board of Supervisors Budget and Finance Committee makes cuts to the mayor’s proposed budget and ends up with a pot of money.

Committee members then reallocate the money to nonprofits in their districts, often in response to intense lobbying efforts.

During the last budget process, the committee reallocated $40 million to health, substance abuse and other social services that had funding cut in then-Mayor Gavin Newsom’s proposed budget.

“That’s been one of my No. 1 pet peeves in this budget process,” Lee said during an interview last week.

Lee has already made his position clear with a number of nonprofits and members of the board. The mayor has begun to hold meetings with supervisors and nonprofit groups to discuss spending priorities and how to save money through efficiencies before he submits a proposed budget on June 1.

The 11th-hour decision-making on the use of these millions of dollars was recommended for elimination by a June 2009 civil grand jury report but the practice lived on.

The City’s operating budget funds nonprofits to the tune of about $500 million each year. The report warned the process allows for groups to receive funding based on “political clout” and not on their effectiveness or need for the services.

“Nonprofits that provide services to local communities are able to marshal constituents to lobby a supervisor,” the report says. “Since board members most often wish to be re-elected or have political aspirations, they respond to the pressure by adding money to the budget.”

This year, however, things could be different if Lee has his way.

“I’d like to have a process where you just do the add backs on the front end and avoid this charade we have every year,” Lee said. “Then you don’t have to parade all of the hurt entities and people who are guessing where the Mayor’s Office is at versus where the supervisors are at.”

Supervisor John Avalos, former budget committee chair, said in previous years the board would face budget proposals with drastic cuts eliminating key services across The City.

“It was how the game was played,” Avalos said.

“There are a lot of people very concerned about what [Lee] might mean,” he said. “I expect there will be some version of [add-backs]. Maybe it won’t be as contentious and divisive as in the past.”

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