articulate the needs of your community and how we must take that into consideration as we make the decisions that affect our departments, our personnel, and our budgets.

before i begin, i want to give a thanks to the immigrant affairs and civic division here. they have been so helpful, along with all the others, to make sure you knew we were coming out here tonight to be part of this community here. thank you very much. [applause] my spanish is not as good as david campos. if i went to law school with both of them, i would have had a lot more fun than what i experienced. it i want to make sure you know that tonight we are listening. we do have a situation that's improving every six months. we get some reports. i've been working really hard with the supervisors to create an investment-friendly city, a city that welcomes job creation. jobs for everybody, not just for

downtown folks. i'm not here in the neighborhoods, also, and making sure that our board and i care about the neighborhood corridors. we're out here on events like sunday street's premier out here for all kinds of different reasons, because we care about every single neighborhood in the city. we want all of you to feel the richness of the city. it is not just for downtown. it never has been. i want you to know that and what you to know we listened very carefully. we are getting better. guess what? we still got a deficit. we have a two-year budget process. we are challenging ourselves a little bit more. about $170 million deficit

for 2013. having said that, the $170 million is better than what it was six months ago. as our economy has benefited from some good sales revenues, and some of the buildings are occupied, we have a better revenue stream all the time. we knocked it off almost $129 million than what it was a few years ago. it is improving. please do not use the word "surplus." it does not exist in my district yet. hopefully while i'm mayor, i hope to use that term in the near future with the supervisors. that would signal to you we've done everything we can to bring back economic prosperity for everybody. tonight, we still have to wrestle ourselves with deficits, with how we deal with

government, how we deliver services, which services are most important, and i need that engagement with you. i also want to recognize a supervisor carmen chu, head of the budget committee for the board. she will be making virtually all these meetings with us as we go to all the neighborhoods enjoy all our various department heads to help make those decisions. she will guide us through, with supervisor campos, supervisor wiener, and all the other supervisors, as well. i want you to remember this year -- last year, i repeated over and over again. i wanted to make sure we had a safe, solvent, and successful city. this year, i would like to guide you in terms of making sure our city is involving you, that we are innovative in our approaches, and that we end our

decisionmaking with a full appreciation of how we invest in our city. involving you, being innovative and creative, and investment in our city. whether your investment is just yourself, your family, your investment in the small business, or somebody else's business. if we are in investment friendly city, then you are going to want to stay here and grow. that's how i see it. that city that we love of san francisco can only be that way if we all work together, all listen carefully, that we reflect the traditions of a great city that listens to every neighborhood and bounces and makes those hard decisions the best way we can -- balances and makes those hard decisions the best way we can. guess what? we are not going to have state. jerry brown is not coming in offering more money. he is doing the opposite thing. he has to. washington, d.c., guess what?

they are not going to give us a whole pot of money. we have to innovate our way to solutions in our city. i cannot think of a better way. if someone tells me they do not have enough money to do something and that i've got a period of time to do it, i'm going to look around for the best minds and the best friends and people who love the city most and say, let's work together to find solutions. how do we pay for those cuts for the aids programs scott has referred to, or supervisor campos has talked to me about community-based services that need to be here in the community, not in some centralized place where you cannot get it. how do we do all of that and still maintain the balance? that is up to us to find that way. you have a mayor that is seriously focused on your problems, because there are problems. it's not my budget. it's our budget. i will spend every day and hour i can to find the best solutions

that i can. i have some really keen brains here. they are very smart people. they are very dedicated people. they are going to work really hard with me as to how to bring the best, highest level of services, culturally competent services, services to every neighborhood, and still try to balance the budget with all the things you been reading about and hearing about the enough speeches. tonight is about listening to you. thank you very much. let's get the road show started. [applause] supervisor campos: thank you, mr. mayor. we assume that by your presence here, if there's any surplus, district 8 and district 9 will be the priorities, i imagine. [laughter] let me introduce the department heads that are here. before we do that, i want to acknowledge supervisor carmen chu, chair of the budget

committee. i want to thank her for her presence and for also having a truly transparent budget process. thank you, supervisor chu. [applause] so, these are the department heads that are here. if i missed anyone, please let me know. we have our city librarian, child support services, karen roy, san francisco housing authority henry alvarez, capital planning committee, brian strong, our fire chief, human agency, department of children, youth, and families. from the department of public health, barbara garcia and the cfo is here.

department of public works. recreation and parks, phil ginsburg. our police chief is at the police commission meeting. we have the deputy chief and also are station capt. here. from the mayor's office of housing, we have olson lee. we have our newly appointed city administrator. we also have the mayor's education policy adviser, who is also a member of the board of education. i do not think i missed anyone. i am. sorry. that is later. it's my honor to introduce rachel, the executive director of the vernal heights neighborhood center.

she is an amazing community leader. we are grateful she's here. to introduce our budget director. we'll tell you more about the process tonight. thank you. >> [speaking spanish] thank you, supervisor campos. good evening, everyone. [speaking spanish] it's a pleasure to be here, not only because my organization serves more than just district 9, which is where we are, but we also serve district 8, 9, 10, 11. it is important that we see collaborative processes like this happen. my role tonight is to let you know what you can expect for this evening. the agenda of roughly will be -- you will hear the budget overview from our city's budget director. then you will hear some statements from a constituent representatives from district 8 and district 9.

then the most important part of the evening, when you come in. this is about all of you being involved. being invested, having the time and energy to come here on an evening, a weeknight, to be here, is already in investment on your part. the last thing is innovative. during the open mikc section, that's when all of the people appear to make decisions for the city who want to hear what your thoughts are in terms of priorities, revenues, cost- saving measures. lastly, after the open mic, we can expect to hear the thoughts and ideas from our guests on what they heard from all of you. without further ado, i will go ahead and introduce our budget director for the city, kate howard. [applause]

>> thank you. i thought i would just do a very brief overview of how our cities budget works. we talked a lot about it being a policy document, about where our priorities are. that's right. it's also like your family's checkbook. as families, we make a budget. we have income that comes in from our pay checks. we have expenses that go out every month to pay for rent, to pay for our kids' education, to pay for clothing, all of those kinds of things. our city's budget is large. it's about $6.8 billion per year. it's about 50% what we call enterprise funds. about 50% is what we call the general fund. i like to think of the enterprise funds as the city's small businesses. if you were a person and you had a personal budget, you would

not combine your small business budget with your home budget. we do not do that either. in our enterprises, just like the airport, the puc, the mta. we spend most of our time talking about the general fund. what do we spend our money on? we spend our money on our priorities. those are things like -- that are represented by all the departments that are here. things like community, public health, recreation and parks services, fire, ems, and police services. programs for children, families in the city. we also spend money on things like our infrastructure and r streetour streets. that's where our expenditures are. the other part, where do we get our money from? our income is really our tax revenue. we get money from property taxes that homeowners pay and private property owners. we get money from the hotel tax,

when tourists visit san francisco. we get revenue that people pay. we also the money from the state and federal government. all of those things are fluctuating with the economy and fluctuating with the state and federal government's ability to pay. we spend a lot of time talking about the budget shortfall. what is the budget shortfall? basically, the gap between how much money we get in revenue and how much money it cost to keep doing exactly what we're doing now. one way to think about it is, if you get your paycheck every month and next month the rent goes up and next month the utility bill goes up, your expenditures are growing faster than the income that you have. that's the same situation that

we have. the difference is $170 million and next year will be $312 million. the task is to figure out how we balance that. how do we create a situation where expenditures match revenue over the next two years while at the same time investing in the priorities that we all care about and doing the things that the mayor and the supervisors and others have spoken about. that is the basics of the budget. i think the best way to think about it, not much different than the choices you have to make at home. you have to think that we are buying different things than you are buying. we're looking forward to hearing from you. i will turn it back over to rachel. >> thank you. it might seem like a simple

process. in some ways, it is. we want to make sure we get everyone's input, thoughts, and ideas through our open mic sections. i want to make sure to bring to your attention a few things. in order to participate in the open mic session, you want to fill out one of these things here. these speaker cards are available up front. there are two bowls. one is for district 8 and one is for district 9. we will be just like a city hall. we will pick names. i will be explaining or announcing who will be coming up. up and you will be using this microphone in the middle here. it looks like there are some areas of concern that you would want to select, as well as a summary of your question or concerns. because we are not going to be able to get to everyone tonight, it's really important that your

input is included. if you please fill this out, even if we do not call you, the idea is that the supervisors will compile this information and included in the way that the budget process is being handled. this is just the beginning of the budget process. it is april. this next section -- i am pleased to introduce some constituents speakers. we're first going with district 9 speakers. i'm introducing to you from good samaritan, mario potts. >> thank you. thank you, mayor, and supervisor campos and supervisor wiener for this opportunity. this organization has been around for a long time, more than 100 years. we have been serving district 9.

we have certainly seen the changes over the years. i was also born and raised in district 9. i went to both public and private schools. i launched my career here. this is the community that has been in my heart for a very long time. i'm very honored to be able to continue to serve it. i often get asked what the mission district is like now. many of my friends, we grew up here together. i like to describe it as sort of a tale of two cities. depending on who you ask, if you the best of times or the worst of times. if you are a family with young children, i think it's the worst of times. struggling to find affordable housing, increasing rent, and trying to find affordable child care, and making sure that the streets are safe for your children and so forth. it's not the best of times for them. it's not the best of times for