Breed offers to forgive loan to S.F. schools
A $26.6 million city loan to San Francisco’s school district would be forgiven under legislation proposed by Mayor London Breed, but only if the school board comes up with a comprehensive plan to get its budget under control.
Breed, along with Supervisor Hilary Ronen, announced the proposal Friday, saying it would help the district get on a path to success and help alleviate the district’s estimated $125 million shortfall next year.
“Our schools are facing an uncertain and dire fiscal future, so forgiving this loan is the right thing for the city to do to support our kids and our families,” Breed said in a statement. “Tying the forgiveness of these loans to the execution of a comprehensive plan will ensure that these critical dollars are part of a long-term effort to stabilize our District and our schools.”
The city loaned the money in 2019 to help cover ongoing teacher raises promised under Proposition G. But the measure has been tied up in court since it passed in 2019 over whether the parcel tax was legally passed by voters.
A final decision in the case came down this week, with the state Supreme Court declining to hear the case. The ruling means the district can now access the $150 million collected under the parcel tax, but frozen in an account during the legal process.
But the district doesn’t have full control over the funding. It owes $26.6 million to the city and another $40 million to the Rainy Day Fund, district officials said. In addition, $30 million must be spent on educator salaries, training and technology as required under the original measure.
That would leave about $53 million for the district to use as it best sees fit, district officials said. If the loan is forgiven, that number jumps to nearly $80 million.
The money would offer the district significant breathing room — albeit in one-time funds — to address what has been years of overspending.
“We are very grateful to the city for this generous act of support for San Francisco’s public schools,” said Superintendent Vince Matthews. “We remain committed to working diligently with the Board of Education, our community and fiscal experts to deliver a budget balancing plan.”
The proposal would require support from the Board of Supervisors.
“Our city government has stepped up time and time again to support our public school, students and educators,” Ronen said, adding that she hopes to see the state step up to boost funding for schools. “We also need school district leaders to focus on their core duties, putting student well-being at the center of all financial decisions.”