Amid heated political sparring, San Francisco approves $9.6 billion budget

Despite heated exchanges with accusations of hypocrisy and extortion, the Board of Supervisors came together Tuesday to approve Mayor Ed Lee’s $9.6 billion budget and placed a sales tax increase on the November ballot.

Controversy swirled for weeks over whether the board would support a .75 percent sales tax hike to fund transportation and homeless services after the proposal became entangled in a debate over a controversial homeless encampment measure on the same ballot.

After initially backing the sales tax measure, Supervisor John Avalos vowed to revoke his support unless Supervisor Mark Farrell pulled the homeless encampment measure he placed on the ballot in late June. Avalos criticized the measure as “mean-spirited” and a “wedge issue.”

Farrell blasted Avalos for linking his support of the sales tax to his homeless encampment measure.

“It is an attempt at extortion,” Farrell said. “It is subverting the democratic process here at the Board of Supervisors, and I think it is disgusting.”

That standoff persisted for weeks, and Farrell would not budge. But Avalos ultimately decided to support the sales tax hike after talks Tuesday among his progressive allies to craft an alternative revenue plan fell through.

“I cannot vote against this measure when that greater good is before us,” Avalos said.

The board voted 8-3 to place the measure on the ballot, with supervisors Aaron Peskin, Jane Kim and Norman Yee opposing it.

The sales tax increase, which is assumed in Mayor Lee’s budget, would generate $100 million for transportation and $50 million for homeless services like housing and Navigation Centers.

“This measure is so essential,” Supervisor Scott Wiener said. “These are two of our most basic responsibilities: housing our homeless and ensuring great transportation.”

Kim argued the sales tax “disproportionately impacts our lowest income residents.”

“My vote is not political,” Kim said. “We should look for other revenue sources or live within our means in terms of funding these homeless services.”

San Francisco’s sales tax is currently 8.75 percent, but will decrease to 8.5 percent in October. The tax hike would create a 9.25 percent sales tax rate come April 2017.

The board voted 10-1 to approve Mayor Lee’s proposed $9.6 billion budget for the 2016-2017 fiscal year, which began July 1.

The vote came after the board’s Budget and Finance Committee, chaired by Farrell, made about $30 million in spending priority changes during a recent two-week review. With the local economy booming, the budget increases The City’s investments in services and grows public-sector jobs.

Peskin was the lone vote against the budget.

“I cannot support the budget being balanced with a regressive tax,” Peskin said. He added, “Quite frankly, I don’t think it’s good fiscal policy to bake into the budget revenue that the voters haven’t even voted on.”

Also Tuesday, Avalos’ proposal to place tens of millions of dollars of the Police Department budget on reserve was defeated in a 5-6 vote. The funds would have been contingent upon proof of department reforms, including its use-of-force policy. Supervisors London Breed, Malia Cohen, Norman Yee, Katy Tang and Wiener opposed it.

Heading into a critical election, tempers at City Hall were already flaring prior to Tuesday’s meeting as the deadline looms to place measures on the November ballot.

Once again, those tensions came to a head prior to the budget and sales tax votes, when the board’s progressive members wouldn’t back Supervisor Cohen’s proposed charter amendment to rename the Office of Citizen Complaints as the Department of Police Accountability and to analyze the Police Department’s handling of claims of misconduct and use of force. The progressive bloc instead wanted to fold the proposal into a proposed Public Advocate charter amendment. A vote on that measure is scheduled for next week.

Cohen blasted the progressives for playing dirty politics.

Avalos said such criticism is “total hypocrisy” since moderates have used “dirty politics” to impact progressive proposals at the board committee level, where moderates have a majority in some cases.

The progressives’ actions also led Wiener to highlight the political divide on the board, calling it a “majority clique” that evaluates proposals not “on their merits” but politics alone. He suggested it was the reason why “public approval ratings of this Board of Supervisors continue to go down.”

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