The economy's improving. Tax revenue is up. So why is the city still facing a budget deficit of more than $200 million? Easy: San Francisco has, and will continue to have, a structural budget deficit. The amount of money that comes in from taxes in all but an unusual boom year isn't enough to cover the cost of providing the services the city has taken on. Some of those services are things that the state and feds used to provide. Some are things that San Francisco does because it's a decent and humane city. All of those things cost money, and our tax base doesn't generate enough to pay for them.
It's easy to blame the problem, as the Examiner does, on "employee costs." But city employees have already taken significant pay cuts and layoffs. The pension-reform plan passed last year reduced costs further. The reality is that the city has never taken seriously the need to raise enough revenue to cover its operating costs. That's why we see headlines like this every single year, and it's not going to change.
And that's why city officials who deny that there's a structural problem are kidding themselves.
By the way: The economy's improving around the nation. It's not just because of Ed Lee.