The budget's opening battle - Page 2

Sparks fly from the Newsom/Daly budget battle

Daly pushed back against what he loudly labeled the mayor's "backdoor veto," which he considered illegal.

"You may not believe the question of affordable housing and affordability is more important than redesigning the city's Web site or perhaps installing cameras in police cars or fixing a pothole, but to say that the money does not exist is a lie," Daly said at a board meeting.

So when Newsom submitted his final budget June 1, Daly proposed restoring the funding and taking away $37 million from what he called the mayor's "pet projects." His suggestion triggered a political firestorm, since his targets included a wide array of programs, including $700,000 for a Community Justice Center, $3 million for one police academy class, $10.6 million for street repairs and street trees, $2.1 million to expand the Corridors street cleaning program, and $500,000 for a small-business-assistance center. In their place, Daly argued, the city would be able to restore funds cut from affordable housing, inpatient psychiatric beds, and services for people with AIDS.

In addition to uniting against him those constituencies whose funding he targeted, Daly's proposed cuts in law enforcement — and his brash, unilateral approach to the issue — threatened to cost him the support of Sup. Ross Mirkarimi, a progressive with public safety credentials who represents the crime-plagued Western Addition. So it was a precarious situation that became a full-blown meltdown once the Newsom reelection campaign started phone banks and e-mail blasts accusing Daly of endangering public safety and subverting the normal budget process.

Pretty soon, with Daly's enemies smelling blood in the water, it became a sort of feeding frenzy, and various groups urged their members to mobilize for a noon rally before the June 13 Budget and Finance Committee meeting. "We are a sleeping giant that has awakened," small-business advocate Scott Hauge claimed as he e-mailed other concerned stakeholders, who happened to include Friends of the Urban Forest and public housing activists, thanks to Daly's call for a $5 million cut in Newsom's Hope SF plan, which would rebuild public housing projects by allowing developers to also build market-rate condos at the sites.

"Mirkarimi seems to feel strongly about having cops and infrastructure, which are typically the priorities of conservatives," Daly told the Guardian as he announced plans to cancel the June 13 budget hearing, which he did after accusing Newsom of engaging in illegal electioneering.

Daly also accused Newsom of abusing his power by securing the City Hall steps for a budget rally at the same time, date, and place that Daly believed his team had secured — a mess-up city administrator Rohan Lane explained to us as "an unfortunate procedural thing."

But while Daly told us he "needed to hear from progressives who enjoy diversity, because if we don't get more affordable housing dollars, San Francisco is going to become increasingly white, wealthy, and more conservative," all anyone could hear the next day was a pro-Newsom crowd chanting, "No, Supervisor Daly, no!" outside City Hall.

Newsom spoke at the rally and claimed that Daly's proposal to cut $5 million from Hope SF would eliminate "$95 million in local money to help rebuild San Francisco's most distressed public housing," a figure that includes the bond issue Newsom is proposing. With the 700 to 900 market-rate units included in the program, Newsom claims the cuts will cost the city $700 million in housing.

"Stop the balkanization of San Francisco!" Rev. Al Townsend roared, while Housing Authority Commissioner Millard Larkin said, "People are living in housing not fit for animals.