In a move that has sparked significant discussion, San Francisco’s mayor has given the green light to a controversial reparations proposal. This legislation could ultimately lead to a transformative fund designated for the city’s eligible Black residents, with potential payouts reaching as high as $5 million each.

Mayor Daniel Lurie signed the contentious Reparations Bill with little fanfare, opting for a quiet approval just a couple of days before Christmas, perhaps to avoid immediate public scrutiny. This bill marks a significant step in the city’s ongoing dialogue about addressing racial inequalities.

The ordinance officially establishes a Reparations Fund as advised by the African American Reparations Advisory Committee (AARAC) and highlighted in their comprehensive 2023 report. However, it’s important to note that while the fund itself is created, it presently lacks any financial backing. This framework is meant to prepare for future contributions, potentially sourced from both municipal and private donations.

The AARAC has a clear mission: to formulate recommendations aimed at repairing injustices suffered by Black communities, as detailed on their official website. Their 2023 report outlines a bold proposition, suggesting a $5 million lump sum for every African American adult in San Francisco. This recommendation is rooted in the belief that such compensation is necessary to address the systemic harm and inequities that have persisted over decades.

The AARAC is tasked with developing ‘recommendations for repairing harm in our black communities,’ according to its website. 

Per the 2023 report, every African American adult in San Francisco should be handed a $5 million lump sum to ‘compensate the affected population for the decades of harms that they have experienced.’

While this effort has captured the most attention – and sparked the most controversy – the AARAC rattled off more than 100 suggestions, including debt relief, guaranteed annual income of $97,000, debt forgiveness and city-funded homes for black people. 

In 2023, the conservative public policy think tank Hoover Institution said the plan would cost each non-African American household in the city about $600,000 in tax dollars. 

San Francisco lawmakers have approved a bill to set up a Reparations Fund 

Mayor Daniel Lurie quietly signed the divisive Reparations Bill two days before Christmas

However, Lurie told the Daily Mail that this is not the case, citing the city’s struggling finances. 

‘For several years, communities across the city have been working with the government to acknowledge the decades of harm done to San Francisco’s black community,’ Lurie wrote. 

‘While that process largely predates my administration, I am signing the legislation to create this fund in recognition of the work of so many San Franciscans and the unanimous support of the Board of Supervisors.’

But Lurie said the city is bracing for a $1 billion budget deficit next year.

‘That means identifying key priorities for funding so we can continue delivering those services well,’ he explained. 

‘Given these historic fiscal challenges, the city does not have resources to allocate to this fund.’

He noted that his administration has always been open to outside donors, so ‘if there is private funding that can be legally dedicated to this fund, we stand ready to ensure that funding gets to those who are eligible for it.’

While Lurie clarified the bill’s intent to the Daily Mail, its sly passage drew attention from critics. 

Supervisor Shamann Walton created the Reparations Bill to set up the fund

Opinion journalist Erica Sandberg pointed to No Kings protests over the summer, calling the city’s government hypocritical

Conservative activist Richie Greenberg slammed the fund as a ‘terribly disappointing decision’ on X. 

In a segment of his podcast, he declared that the ‘reparations scheme’ is ‘ludicrously unlawful, irresponsible, illegal [and] unconstitutional.’

Opinion journalist Erica Sandberg slammed the decision as hypocritical.  

‘After large-scale No Kings protests in the summer of 2025 that condemned authoritarian policies from the Trump administration, local officials making such a unilateral decision that is clearly at odds with public sentiment is hypocritical,’ she wrote on her Substack. 

The No Kings protests erupted nationwide over the summer against Donald Trump and his policies. 

San Francisco’s chapter of the National Association for the Advancement of Colored People (NAACP) has publicly opposed the city’s handling of the Reparations Fund. 

Reverend Amos Brown, the president of the NAACP chapter, said the 2023 reparations plan gave black residents false hopes. 

While the organization said it supported cash payments, it called the $5 million lump sum ‘an arbitrary number’ in a news release at the time. 

The African American Reparations Advisory Committee (AARAC) 2023 report details a reparation plan

Former San Francisco Mayor London Breed, who was also a Democrat, had concerns about direct cash payments at the city level.  

She believed that reparations should be handled at the federal level.

About a week before Lurie gave his go-ahead for the plan, the city’s Board of Supervisors voted in favor of it. 

‘This most certainly is different than asking the city to pony up dollars to support reparations recommendations,’ Supervisor Shamann Walton, who penned the ordinance, said, per ABC 7. 

‘It’s gonna take some time. We’ve got to build a pot and then, of course, come up with the right criteria in terms of how we’re going to prioritize what recommendations we address first. But this is a major first step.’ 

The bill’s supporters say it aims to correct disinvestment in predominantly black neighborhoods from the 1950s to the 1970s that drove the community out of the area under the guise of urban renewal. 

The Daily Mail has reached out to the AARAC for comment.