SAN FRANCISCO (CBS SF/BCN) — During a virtual chat with U.S. Secretary of Labor Marty Walsh, Mayor London Breed credited federal aid from Pres. Joe Biden for providing a chance at economic recovery.

During the discussion, Walsh, Breed and New Orleans Mayor LaToya Cantrell praised the American Rescue Plan — a $1.9 trillion economic stimulus plan approved by Congress and signed into law by Biden earlier this month. The plan will result in $636 million for San Francisco.

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“The American Rescue Plan is more than a lifeline, it’s a game-changer,” said Walsh, the former mayor of Boston sworn in last week as labor secretary. “It creates money and programs for vaccinations; direct cash refund employment benefits; child care tax credits and child care funding; housing relief; small business support and so much more.”.

“What a relief it is to have a federal administration in the White House that actually wants to work with cities like San Francisco, instead of spending time and energy to target us. At the beginning of the pandemic in 2020 we were truly on our own,” Breed said.

Breed said although last year the city was able to balance a $1.5 billion budget deficit without making any layoffs or cuts to city services, those same cuts and layoffs would’ve been unavoidable for the upcoming two-year budget cycle, as the city faced a $653.2 million budget deficit.

“The American Rescue Plan has changed all of that, so instead of a $650 million deficit, we now have a $23 million deficit. We’re not going to need to lay off any employees. Instead, we’re able to make investments in our recovery,” she said.

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“This one bill has undoubtedly changed the future of our city for the better. We can’t fully recover until the pandemic is behind us but we know that we also need to make the investments right now that will help drive the recovery,” Breed said. “It’s key that we’re able to operate our businesses safely; bring back sectors of our economy that we rely on like tourism and hospitality; and get our residents back to work.”

The projected $650 million budget deficit for the upcoming two-year budget comes from a new report released on Wednesday by the Mayor’s budget office, the City Controller and the Board of Supervisors Budget and Legislative Analyst.

The report also showed that although the one-time federal stimulus will help with addressing the upcoming two-year budget, it won’t help with the Fiscal Year 2023-2024 budget deficit, which is projected to be $350 million.

The report noted that “to the extent that policymakers make choices that curtail ongoing spending increases, the city can avoid exacerbating these shortfalls and reduce difficult choices in the future, thereby maximizing the city’s ability to maintain its services and programs for San Franciscans.”

After being approved by the Board of Supervisors in July, the budget is due on Aug. 1.

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