Budget and Finance Committee - 2026-01-28
Meeting Intelligence Preview
Meeting Summary
The Budget and Finance Committee approved multiple grants and contracts including a $7M Bloomberg Philanthropies grant for the Mayor's Office of Innovation, a $1.5M state housing grant for MOHCD, and a $40M waterfront resilience program contract with Jacobs Engineering. The committee also advanced the Downtown Revitalization Financing District plan, which could generate up to $610M in tax increment financing over 45 years to support office-to-residential conversions in the Financial District, Union Square, and surrounding areas.
Key Decisions (10)
Bloomberg Philanthropies Grant for Mayor's Office of Innovation
Authorized acceptance of $7M grant from Bloomberg Philanthropies to fund the Mayor's Office of Innovation from January 2026 through December 2028, expanding team from 6 to 10 positions. Grant requires 30% match ($2.3M). Four new positions created: service design leader, designer, data scientist, and product manager.
Downtown Revitalization Financing District Plan
Approved financing plan for Downtown Revitalization and Economic Recovery Financing District covering Financial District, Union Square, Mid Market, Civic Center, and parts of SOMA. Plan projects up to $610M in tax increment financing over 45 years to support office-to-residential conversions. Estimated 48 buildings could convert, creating approximately 4,400 new units and 7,000 residents.
Pro Housing Incentive Program Grant
Authorized MOHCD to accept $1.5M grant from California HCD's Pro Housing Incentive Program. Funds will support construction or rehabilitation of affordable housing, likely 835 Turk (106 affordable units). San Francisco received Pro Housing designation in October 2024.
Jacobs Engineering Waterfront Resilience Contract
Approved $40M five-year contract with Jacobs Engineering for program advisory services for Waterfront Resilience Program. Contract supports Army Corps flood study and design of $13.5B coastal flood defense plan. Includes option for five-year extension.
HealthRight 360 Contract Amendment for Withdrawal Management
Approved amendment extending DPH contract with HealthRight 360 by two years through June 2028, increasing amount by $28.6M to total $38.6M. Funds 10 beds at Acceptance Place (890 Hayes) and 20 beds at withdrawal management facility (815 Buena Vista).
TEGSCO Towing Contract Extension
Approved tenth amendment to SFMTA towing contract with TEGSCO LLC, extending term by 9 months with up to 6 additional one-month extensions through June 2027, increasing amount by $22.1M to $158.8M total.
Dry Dock Emergency Repairs at Pier 68
Approved Port emergency declaration for $10M in immediate repairs to stabilize Dry Dock Number 2 at Pier 68. Total disposal project for both dry docks estimated at $61.2M. Emergency contractor Power Engineering Construction Company already issued notice to proceed.
India Basin Shoreline Park Grants
Approved three grants totaling $6.2M for India Basin Shoreline Park: $1.15M from SF Bay Restoration Authority Measure AA, $2M from EPA Brownfield Cleanup Program, and $3.09M increase from California State Coastal Conservancy (total $8.59M from Conservancy).
Tipping Point Grant for Director of Strategic Partnerships
Authorized acceptance of $700,000 grant from Tipping Point Community to fund Director of Strategic Partnerships position in Mayor's Office for 2.5 years. Cynthia Wong hired for role. Grant covers 100% for two years, 50% in year three.
VoIP Access Line Tax Technical Amendment
Approved ordinance revising how access line tax applies to Voice over Internet Protocol services, requiring collection based on lower of telephone numbers provided or simultaneous call capacity.
Development Activity (4)
India Basin Shoreline Park Phase 3
Phase 3 groundbreaking August 2025, completion anticipated early 2028. Includes shoreline access, bioretention infrastructure, bay water trail access, gravel beach, boathouse, and floating dock.
835 Turk Affordable Housing
106 affordable units, tentative recipient of $1.5M Pro Housing Incentive Program grant pending other state funding notifications
Downtown Office-to-Residential Conversions
Estimated 48 buildings eligible for conversion, potentially creating 4,400 new units and 7,000 new residents. Tax increment financing of up to $610M over 45 years available.
Waterfront Resilience Program
$13.5B coastal flood defense plan addressing 1.5-3.5 feet sea level rise, adapting historic buildings, 3+ miles of engineering with nature features. Army Corps study expected to conclude 2026.
Market Signals (5)
Commercial Demand
San Francisco downtown has 30 million square feet of vacant office space, with vacancy rates around 30%, though descending; significant portion is functionally obsolete for current use.
Housing Demand
City pursuing aggressive office-to-residential conversion strategy with multiple incentive programs including fee waivers, inclusionary requirement waivers in C-3 districts, and new tax increment financing district.
Infrastructure
Port's Waterfront Resilience Program could unlock up to 65% federal funding ($8.8B) for $13.5B coastal flood defense project if Army Corps recommends plan to Congress in 2026.
Sentiment
Bloomberg Philanthropies awarded largest-ever innovation grant ($7M) to any city globally, signaling confidence in San Francisco's government innovation capacity and recovery trajectory.
Housing Demand
Consultant analysis identified 48 buildings as likely conversion candidates based on vacancy, size, and age, suggesting meaningful pipeline for downtown residential development.