San Francisco’s Bold Step Towards Reparations: A Fund Without Funding (Yet)

In a move that has sparked both hope and controversy, San Francisco Mayor Daniel Lurie signed an ordinance just before Christmas establishing a “Reparations Fund” that could potentially grant eligible Black residents up to $5 million each in reparations. The measure, which passed the Board of Supervisors earlier in December, creates the legal framework for addressing what the city describes as historic discrimination and displacement faced by Black San Franciscans. However, this signing comes with significant caveats that reflect the complex reality of implementing such ambitious social justice initiatives in a city facing serious financial challenges. The ordinance creates a structure for collecting and distributing funds but stops short of allocating any money or guaranteeing payments, essentially creating a vessel that still needs to be filled.

Mayor Lurie has been explicit about the financial limitations surrounding this initiative, emphasizing that no taxpayer dollars will flow into the fund given San Francisco’s staggering $1 billion budget deficit. “I was elected to drive San Francisco’s recovery, and that’s what I’m focused on every day,” Lurie stated. “We are not allocating money to this fund — with a historic $1 billion budget deficit, we are going to spend our money on making the city safer and cleaner.” This stance highlights the tension between symbolic policy gestures and fiscal realities that many progressive cities face when attempting to address historical injustices. The fund is instead designed to accept private donations, foundation grants, and other non-city sources of funding, with any potential taxpayer-funded reparations requiring separate legislation, an identified funding source, and explicit mayoral approval—a series of hurdles that appear formidable in the current economic climate.

The ordinance draws heavily from a 2023 policy report produced by the San Francisco African American Reparations Advisory Committee (AARAC), a city-appointed body tasked with studying historical harms against Black residents and proposing remedies. Their non-binding recommendations included the headline-grabbing $5 million payment suggestion, which would potentially apply to approximately 46,000 Black residents in San Francisco according to U.S. Census data. The committee’s report specifically cited “residential displacement” and “racial discrimination” as harms perpetuated by the city, particularly during the urban renewal era from the mid-1940s through the 1970s—a period often referred to as “Negro removal” in affected communities across America. This historical framing attempts to establish a direct link between specific city policies and current disparities, moving beyond the broader national conversation about slavery reparations to focus on documented local actions and their consequences.

Beyond the monetary payment that has captured public attention, the AARAC report outlined a comprehensive approach to reparations that would touch multiple aspects of life for Black San Franciscans. These recommendations included a guaranteed annual income tied to area median income, the creation of new city agencies (including an Office of Reparations) to administer programs, major housing interventions such as rental assistance and homeownership support, city-backed funds to purchase property along Black business corridors, and multi-million-dollar investments in Black-owned businesses. This holistic approach reflects a growing understanding among reparations advocates that addressing historical injustices requires systemic change across multiple domains rather than one-time payments alone. The ordinance’s language embraces this multifaceted view, describing the Reparations Plan as outlining “a variety of methods to provide restitution, compensation and rehabilitation to individuals who are Black and/or descendants of a chattel enslaved person and have experienced a proven harm in San Francisco.”

San Francisco’s move comes as other municipalities and states across the country grapple with similar questions about how to address historical racial injustices. The California Legislature has attempted to pass specific reparations bills following recommendations from the state’s Reparations Task Force established in 2020, but these efforts have stalled or been rejected. Similar initiatives have emerged in places like Evanston, Illinois, which implemented a more modest housing-focused reparations program, and Boston suburbs that have expanded guaranteed income programs. These varied approaches reflect both differing local contexts and the absence of a national consensus on how reparations should be structured, funded, or distributed. San Francisco’s approach—establishing a framework without immediate funding—illustrates the political balancing act of acknowledging historical wrongs while navigating practical limitations and potential public resistance.

The San Francisco ordinance represents a significant symbolic step in the national conversation about reparations, even as its practical implementation remains uncertain. By creating a legal structure for reparations while deferring the more contentious questions of funding and eligibility verification, the city has advanced the discussion without committing to immediate expenditures it cannot afford. For supporters, this represents progress toward accountability for historical injustices that continue to shape racial disparities today. For critics, it may appear as political theater without meaningful commitment. What remains clear is that San Francisco, like many American communities, is struggling to reconcile aspirational justice with fiscal realities, historical accountability with forward-looking governance, and symbolic gestures with substantive change. Whether this ordinance eventually leads to actual payments or remains primarily a statement of intent will depend on future political will, economic conditions, and the success of fundraising efforts outside the city’s strained budget—making the Reparations Fund a compelling but unfinished chapter in America’s ongoing reckoning with its racial history.