Mayor London Breed and Supervisor Matt Haney on Wednesday announced a deal on how The City will spend a budget surplus.<ins></ins>

Mayor London Breed and Supervisor Matt Haney on Wednesday announced a deal on how The City will spend a budget surplus.

Agreement reached over how to spend $125M surplus

San Francisco has reached an agreement over how to spend a $125 million surplus in the current fiscal year, with money going to those impacted by the COVID pandemic including small businesses, renters, art programs and overdose prevention.

The Board of Supervisors Budget and Appropriations Committee was scheduled to vote Wednesday to approve a number of items that are part of the agreement, which was announced ahead of the meeting by Mayor London Breed and Supervisor Matt Haney, the committee’s chair. The committee ultimately approved a series of amendments in support of the deal and will next meet on Tuesday when it’s expected to vote to send the package to the full board.

The surplus was the result of higher than expected revenues, such as property taxes.

“People continue to struggle with housing security and addiction, and our arts and culture sector, which is part of what makes San Francisco so unique, is suffering,” Breed said in a statement. “While we are working towards our long-term recovery, we know we need this immediate support that will help get our city back on its feet.”

Haney said, “This package will keep small businesses open, fight the opioid epidemic, support our kids and families, and ensure tenants can stay in their homes.”

The deal includes $24.8 million for small business grants and loans, which includes $3 million for entertainment venues and $2.3 million to help businesses set up parklets, also called shared spaces, and $1 million for small businesses impacted by property crime.

To offset the loss of revenue from a tax on hotel stays, of which a portion flows to the arts, $24.1 million will go to arts and cultural programs.

The deal includes some recently approved efforts, such as $13.2 million to allow nearly 80,000 businesses with less than $25 million in gross receipts to defer registration and license fees due in May to November. Also included is the recently approved legislation introduced by Supervisor Catherine Stefani to waive about $15 million in business and license fees, including those affecting tattoo parlors, which were forced to close due to the COVID lockdown.

A large portion of the surplus is the result of the voters passing Proposition I in November, which increased the tax on the sale of properties valued at more than $10 million.

The measure was introduced by Supervisor Dean Preston to help with rental relief and affordable housing.

Under the deal, $10 million will go to help offset the back rent owed by tenants, helping to supplement the state’s rental relief funding. Another $10 million will go toward affordable housing acquisition and rehabilitation.

As San Francisco saw a record number of fatal drug overdoses last year with 699, and with no sign of the trend declining this year, $1.6 million would go toward overdose prevention programs in single-room occupancy hotels and street outreach.

Other funding includes $15 million for summer programs for youth, $2.7 million to expand summer internships for public high school students and $2 million to continue the Family Relief Fund, which was created last year to provide relief to help undocumented families not eligible for state and federal financial support.

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