Growing up in San Francisco, I thought I was the luckiest kid in the world. A beautiful city built right on the bay. Nice views and water within a drive about 20 minutes in any direction. Most of the people I knew or interacted with, were locals and had been here for generations. A small-town feel within the big city. A place where we were able to play in the streets until dark; when I was nine my parents had no problem letting a friend and me walk to the corner store alone. In a time before cell phones, we could disappear all day with just a “Mom, I’ll be at Joe’s house,” and the house phone would eventually ring to call me home.
I knew that one day when I grew up, I wanted the same experience for my children. It took a lot of effort but in 2010, I was able to buy a house. Two short years later, my wife and I were blessed with our first child. Then in 2016 we had our second child.
But in that time my city has continued to rapidly change and seemingly deteriorate. Although my wife and I both work and make good money by any typical standard, in San Francisco it is never enough. The constant tax increases, in property tax, sales tax, property tax levies, and continually burdensome regulation has made it almost impossible to live and raise a family. So, I started to look at where all the money really goes…
The City of San Francisco, a city of 870,877 people and only 49 square miles, is slated to spend $10.1 billion dollars next fiscal year, which started July 1.
You read that right: a city of less than 1 million people plans to spend over $10 billion dollars.
Let’s compare that to other California cities of even greater size: San Diego has a population of 1.2 million people, an area of 372 square miles, and spends $3.1 billion. San Jose has a little over 1 million people, an area of 180 square miles, and also spends $3.1 billion.
San Francisco has less than half the size in land area and a few hundred thousand less people, yet spends over three times the amount of money per year. (To be fair, San Francisco does have a large commuter population during the work week. It is estimated that Monday to Friday the population in the city doubles.)
But what do we have to show for this gross fiscal irresponsibility? Do we have perfect, nicely-paved roads? Clean streets? No crime? Do the buses and trains run on time? Are all of the parks clean and in nice shape? Are city schools the best in the nation? Flying cars?
The answer to all of these is a resounding NO! Anyone who has come to San Francisco will eventually be hassled by the homeless, have to step over human excrement, or wait a long time for their bus to get around the city.
How on earth does San Francisco spend so much money? Where does it all go? How can a city justify spending $11,597 per every man, woman, and child living in the city?
Let’s take a look into the numbers. For years, San Francisco has created and maintained a Homeless Industrial Complex. One of the most expensive cities in the country literally pays for more homeless people to pour in. Non-profit organizations, many of which are paid to serve the homeless or very low income individuals, will be dividing $600 million dollars under the 2017-18 budget.
By comparison, the city will spend less on the San Francisco Police Department ($590 million), the San Francisco Fire Department ($382.3 million), the San Francisco Sheriff’s Department ($231.7 million), the Recreation and Parks Department ($220.4 million) and the Public Library ($138 million), among many other offices which don’t even eclipse the $100 million mark.
In addition, the Office of Homelessness and Supportive Housing’s (OHSH) 2017-18 budget of $245.9 million, up from $224 million last year, means a portion of many other department’s budgets are also swallowed up by the homeless issue. From other direct funding of homeless programs, the Mayor’s Office pitches in an extra $14.6 million, to the Department of Public Works which must clean up the shanty towns and excrement left behind, to Zuckerberg General Hospital which must provide medical services they will never receive payment for, to the San Francisco Fire Department that ends up providing free ambulance rides to those who know how to game the system. The true cost of homelessness in San Francisco pales in comparison to the already bloated $245.9 million from just one department.
Even just using the budgeted figure of $245.9 million, the OHSH says in its “Performance Measures” that in 2015-16 it provided 285 families with a rental subsidy. 648 families kept housing through a one-time grant; 566 adults left homelessness do to placement in permanent supportive housing; 880 people were given bus tickets to be sent back to a willing family member in another city or state; and 790 people maintained housing due to a one-time grant. This means by their own measure the OHSH served 3,169 clients, made up of families or individuals. If the OHSH serves the same amount of clients, the office will spend $77,595 per client served.
According to the U.S. Census Bureau, in 2015 the average, or mean, U.S. household income was $75,558. San Francisco’s Office of Homelessness and Supportive Housing plans to spend more than that per client this year just on their housing needs, and that’s only if it stays on budget; otherwise, costs will of course be higher.
When cities of both a larger area and larger populations can spend less than one-third, how can San Francisco continue to do so? For now, the city is getting away with this gross over-spending because of the tech industry. Tech money has poured in and San Francisco has given tax breaks to companies like Twitter to stay in the Market Street area and drive the revitalization. While these breaks have driven the local economy and made the city more money, the city has decided to spend more and more instead of relieving the burden of onerous taxes upon its residents. The city continues to expand city government into areas like defending immigrants in Federal Immigration court, a new cost of $1.5 million this year and rising to $2.3 million annually.
It will be very interesting to watch who is stuck holding the bag when the bubble bursts and reality comes back to the city finances. The tech bubble has been growing and growing for the past few years. The city has done a dramatic amount of construction and added many more housing units to attract the new techies getting paid very high salaries. However, as these large companies start to hit money troubles and the now-publicly traded companies need to shed costs, the obvious answer is to get rid of San Francisco real estate, San Francisco regulations, San Francisco taxes, and the extraordinarily high cost of living in the Bay Area. The City appears to not see this eventual reality and instead is spending like a kid in college with his first credit card.
Ronald Reagan was right when he said, “We should measure welfare’s success by how many people leave welfare, not by how many are added.” San Francisco’s future financial plan seems to live by the opposite philosophy by subsidizing the continued future of homelessness. As the homeless population seems to continually grow year after year, I only hope the city government decides to right the ship and live by the above statement instead of leveraging its financial future on those who take, take, take, but never seem to give.
I write this as a cautionary tale of how progressive politics run amok can ruin a once beautiful place and create an uncertain and totally unsustainable future. San Francisco politicians are betting the continued growth of tech will allow their irresponsibility to stand while the residents passively just sit and let it happen. My city needs a change in order to help restore its luster and return some normalcy.
If you would like to look at the numbers for yourself, here is the San Francisco Proposed Budget for fiscal year 2017-18.
Rich Cibotti, a San Francisco police officer, passed the California Bar in 2016.